This shouldn’t really come as MUCH of a surprise to anyone. Apparently the IRS is planning to take a 25% cut of tournament winnings.
I have read from Ed Miller’s website his take on this. There is an interesting discussion below his post that is definitely worth checking out.
Personally, I believe this is just another attempt of our government trying to convince Conservative America that they are actually doing some work. This reminds me of the banning online poker and the banning of smoking in public places. It is is the fight against sin… remember that. 
I don’t mind the taxes being there as long as they are fair and it is in an attempt for the government to regulate gambling. I would much rather see tax and regulation of online poker than it be in the state it is in currently - banned. As long as the tax is in the name of regulation, I am fine with it. It is the reasoning for these taxes that I have a problem with. The “sin tax” stuff is absolutely ridiculous. It is sign of our county’s hypocritical self-righteousness.
Asking why applies to everything in life as can so many poker concepts.
Just remember, this is not a new tax. This is merely a withholding requirement. Much like taxes taken out of your paycheck every week. Why is the IRS doing this? Well, poker players, being the degenerate gamblers that we are, tend to spend the money and then when tax time come we go oh yeah. OOPS. It’s similar to what they do at a casino if you hit the slots big, or if you win a longshot at the track. The Govt. wants to make sure they get their share before you get the chance to squander it all on hookers and blow.
Good catch.
Of course, there is a bit of disdain when I see stuff like this come out because it is related to the government, and Conservative America in general, treating gambling like the devil.