The World Series of Poker has made adjustments to the structure used for determining event payouts during the 2024 WSOP. The latest changes involve increasing the minimum payout in most events from 1.5x to 2.02x an event's buy-in and flattening the overall payout curve, while also keeping the money bubble in most events at 15% of all paid entries.
The changes will not apply to the Main Event, which will keep its roughly 1.5x minimum payout intact. And the changes do not apply to special-format offerings such as shootouts, where different payout structures are mandated.
Earlier this week, just days before the 2024 WSOP gets underway, the WSOP announced the changed structures via social media:
The announcement also included a link to the WSOP's revised payout calculator, where players can select any event, which automatically includes the buy-in amount. Players can then input an estimate as to how many entries the event will draw, click 'Enter', and check the results. (It's necessary to input some guess for the number of entries, even though that's all but irrelevant to any event's calculated min-cash amount).
'Kevmath' asks for player feedback
The WSOP post received a boost from the WSOP's veteran social-media czar, Kevin 'Kevmath' Mathers, the WSOP's responsive source for timely information. Mathers asked players for their comments on the changes.
Numerous players liked the adjustment, especially the part about the min-cash being increased from 1.5 to 2.02 times the buy-in. Responses such as these were typical:
Other players and industry people, including some very recognizable names, weren't as enthusiastic:
Revenue reporting concerns likely have some impact
While the complaints about increased stalling have some merit, that'll be up to the WSOP's tournament staff to police. Perhaps more intriguing from a design standpoint are the comments referencing increased IRS reporting requirements and the fact that the Main Event is exempt from the min-cash change.
The IRS has very specific rules about the tracking and reporting of gambling winnings, as most players know quite well. Poker tournaments fall under a very specific rule: If the net winnings, meaning the prize minus the cost to enter, are over $5,000, then the win must be reported and the winning player is issued a Form W-2G. The key word there is "over", and it's why the WSOP likely opted to jump to just over the 2.0x level when boosting the min-cash amounts.
The change especially impacts $5K events, where -- as with all higher-priced events in previous years -- all players who cash will now receive a W-2G with their winnings. Had the WSOP jumped from 1.5x to exactly 2.0x, then a min-cash in a $5,000-entry event would be $10,000, or exactl;y a $5,000 net profit. This would not trigger a Form W-2G requirement according to the IRS rules.
Why, then, was the change to 2.02x made? It's not because the WSOP or parent company Caesars enjoys generating lots of new paperwork. Instead, it's likely that the WSOP wants to avoid the appearance of structuring, an illegal financial activity in which monetary transactions are designed to fall just short of reporting requirements. That's not really what's going on with the min-cashes for 2024, as the rule is more about an individual receiving or sending money that has been disguised or broken into multiple parts. Still, thousands more WSOP event payouts showing up that have produced exactly a $5,000 profit -- one penny shy of needing to be reported -- is the type of thing that a not-savvy-about-poker IRS auditor might raise an eyebrow over.
It's better to be safe than sorry. Caesars, as with virtually every major casino company in Vegas, has had occasional anti-money-laundering (AML) issues with IRS regulators in its past. It's just better for the company to be aware of issues like this and prepare accordingly.
2023: Daniel Weinman and his rail celebrate winning the biggest ever WSOP Main Event... so farPromotional needs also play into situation
Then there's the Main Event being exempted from the increased min-cash structures. This likely has nothing at all to do with any reporting requirements. Instead, it's all about the Main Event's special status as the WSOP's most important marketing and promotional tool.
The WSOP uses the Main Event's payout numbers as a primary way of generating news interest. The payouts can be used in several ways, from the size of the overall prize pool to the winner's share or other payout constructs such as the now-retired 'November Nine', where each final-table player received at least a million-dollar payday.
The WSOP adjusts the Main Event's payout numbers on the fly each year to help support whichever promotional need seems most urgent. No better example exists than the 2023 Main Event, when the WSOP had its first real opportunity not only to smash the event's attendance, but to break Jamie Gold's 2006 record winner's payout of $12,000,000. The 2023 Main Event saw Daniel Weinman claim a record-topping $12.1 million prize.
Seventeen years is a long time for such a record to stand, and in a marketing sense, the series brass wanted to see that record broken. However, during the intervening years, the WSOP had bumped up its standard min-cash from 10% to 15% -- including the Main Event. In order to do that, the WSOP had to consider lowering the payout percentage back down to 10% (or maybe 12.5%), or flattening the payout curve in an extreme way.
The WSOP chose the latter option. Weinman got the record payday, but the rest of the final-table had flattened paydays, as did the next few hundred top spots. Despite a record-setting prize pool, only the top eight finishers received a million dollars or more.
There are always three competing factors at work when calculating payouts -- the winner's payday and other top-end payouts, the percentage of players who make the money, and the min-cash percentage, which defines the shape of the payout curve. It's not possible to make all three factors juicier at once. Here, it appears the WSOP judged that a doubled min-cash in the Main Event would be too impactful on its ability to shape the payout numbers for its other promotional needs. So the Main stays at 1.5x, regardless of what's done for the rest of the series.
