02/03/2006 12:00AM

More difficult than necessary

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NEW YORK - Wagering on American Thoroughbred racing was down $500 million in 2005, but I accept no personal responsibility for this decline: Reliable statistics indicate that my personal handle was up 23 percent over 2004. I have tried to get 2006 off to a strong start for a second year of double-digit annual growth, but the racing industry isn't exactly making it easy for me.

I made the mistake of deciding to tackle the Magna 5 this year despite some reservations about the wager, primarily its $2 minimum and no consolation payoff. Still, the bet seemed like a good fit for me: It begins and ends in the 90 minutes after the finale at Aqueduct, provides a nudge to pay extra attention to the weekend stakes at Gulfstream and Santa Anita, and offers a big multirace pool with a moderate degree of difficulty, slightly higher than a pick four but not quite as tough as a pick six.

This year's inaugural Magna 5 on Jan. 28 began with a minor stakes at Laurel and moved on to four Sunshine Millions races. Just to be safe, early in the day I called an operator at NYRA-One, where I keep my betting account, and was assured that Laurel's ninth race, where the wager begins, was live on the afternoon's betting menu.

Two hours later, I was ready to go with a modest seven-ticket, $416 investment. I phoned NYRA One, started to call out my tickets and was told that I could bet on Laurel's ninth but not a pick five. The teller then confirmed with a supervisor that no, NYRA was not taking the Magna 5.

Oh well. Maybe I could open and fund an online account quickly. The first one I tried required Internet Explorer but my laptop's web browser is Netscape. The second wasn't taking the bet. On the third, it looked like the only way to fund my account, since my credit-card company rejects any wagering transactions, was through a lengthy process involving mailing a voided check. That wasn't going to do me any good in the next half hour.

Unluckily for me, I was still able to get down: I was in Las Vegas for the National Handicapping Champion-ship and the racebook at Bally's was happy to punch out my tickets, all of which neglected to include Miesque's Approval at $99.60 in the Sunshine Millions Turf. The only good news was that this spared me further anxiety over what would have happened had I won.

One of the premier conveniences of account wagering is that winning tickets subject to W-2G reporting and withholding are automatically processed without your going to a window, producing multiple documentation and being photographed. (NYRA-One routinely and efficiently mails me my W-2G's within 48 hours.) If I had used Miesque's Approval, I'm not sure I could have cashed my racebook ticket since I don't walk around with a Social-Security card and was leaving town the next morning.

Unfortunately for those who did use Miesque's Approval, the Magna 5 payoff topped not only the $600 reporting threshold but also the $5,000 one for withholding. It was at least the sixth time in the brief history of the Magna 5 that the payoff has been between $5,000 and $10,000, a level where 25 percent withholding kicks in with a $2 minimum but would not if the tickets were sold in $1 increments. So anyone who was supposed to get $6,792.20 got less than $5,000.

Of the $450,000 or so due to be paid out to winning ticketholders in the $605,218 pool, more than $100,000 was instead shipped straight to the Internal Revenue Service and taken out of circulation - where, according to some economic models, it would have been churned at least five more times for an additional $500,000 in 2006 handle. That $500,000 is only one-tenth of 1 percent of racing's 2005 decline, but something similar happens every day with a big payoff somewhere.

So here I sit back in New York the day before the year's second Magna 5, still without an account that will take the bet, and wondering why racing makes it so difficult for people to play this game and get paid what they should when they win. Everyone agrees that the industry needs a single, national account-wagering system that can be used on- or offtrack, and that the archaic W-2G rules need reform, but year after year passes with no progress on either front.

It's enough to drive you to poker. The night I got back from Las Vegas I began feeling pangs of Texas Hold'em withdrawal and decided to reactivate a long-abandoned online poker account. The site guided me through buying a $500 prepaid long-distance telephone calling-card with an American Express card, deposited the proceeds in my account in about 90 seconds, and never asked for a Social Security number. I would rather play the Magna 5 than 5-card stud any day, but nobody seems to want my action.