While gamblers' winnings are clearly taxable, the tax consequences are not as clear for dealers who have been given a tip or the winnings of a side bet. Until recently, the money was considered income taxable to the dealer as compensation for services rendered. The United States District Court for Nevada, in Olk v. United States, ruled that tokes given to a dealer offered no compensable services to the players. Classifying the dealer's tokes as gifts creates problems which were not discussed in Olk.
Tips Given to Nevada Casino Dealers by Casino Patrons are Nontaxable Gifts, Not Income - Olk v. United States, 388 F. Supp. 1108 (D. Nev. 1975),
San Diego L. Rev.
Available at: https://digital.sandiego.edu/sdlr/vol13/iss2/9