Do I Have To Report Gambling Winnings?
When you file your income tax return you are required to report all income, from whatever source. This includes money from any gambling wins you experienced over the year. The casino will report what they’ve paid you, if the amount was over a certain amount, and if you fail to report the winnings as well you run the risk of questions or an audit by the IRS. To make sure your tax return is accurate, be sure to keep track of your winnings and advise your tax preparer of the amount won. But, you should also advise your preparer of the amount lost. When reporting gambling winnings on your income taxes, you can also deduct the amount you lost.
The rules on what to do about gambling wins and losses on your income tax return are as follows:
- The deduction for the amount lost can only be taken if you itemize your deductions on Schedule A.
- You must be able to provide proof of the amount of the loss in order to take advantage of the ability to deduct the loss.
* You can only claim gambling losses up to the amount of your gambling winnings.
Keeping track of how much money you put into a slot machine or play at a poker table seems difficult, but can be done. Nearly every casino offers a rewards program, whereby you are given a players card for use at machines and tables. The machines and dealers keep track of your play for you, so you don’t have to count your money while at the table. Upon request, the casino will give you a printout of your bets, which includes the amount you lost. This documentation is sufficient and can be used to prove the amount you’ve claimed as a deduction. For more questions on how to handle gambling wins and losses on your taxes, call our office.
If you have questions about what you are entitled to deduct, or what credits you are eligible to take when preparing taxes, let the professionals at Nielsen Law Group help you today. Call (480) 888-7111 or submit a web request here. We work with you for satisfactory and timely results.