John Daly: I lost $55 million gambling
Do you like to gamble?
Do you ever win?
If the answers to these questions are "yes," you need to know about deducting your gambling losses.
All Gambling Winnings Are Taxable Income All gambling winnings are taxable income—that is, income that is subject to both federal and state income taxes except for the seven states that have no income taxes.
It makes no difference how you earn your winnings, whether at a casino, gambling website, Church raffle, or your friendly neighborhood poker game.
As far as the IRS is concerned, a win is a win and must be included on your tax return.
You may not, repeat NOT, subtract your losses from your winnings and only report the amount left over, if any.
Gambling Losses May Be Deducted Up to the Amount of Your Winnings Fortunately, although you must list all your winnings on your tax return, you don't have to pay tax on the full amount.
You are allowed to list your annual gambling losses as an itemized deduction on Schedule A of your tax return.
If you lost as much as, or more than, you won during the year, you won't have to pay any tax on your winnings.
Even if you lost more than you won, you may only deduct as much as you won during the year.
You Need Good Records As the above rules should make clear, you must list both your total annual gambling winnings and losses on your tax return.
This is where most gamblers slip up—they fail to keep adequate records or any records at all.
As a result, y ou can end up owing taxes on winnings reported to the IRS even though your losses exceed your winnings for the year.
This has happened to many gamblers who failed to keep records.
Not to the IRS.
Remos was audited by the IRS.
Will the IRS Know?
Gambling is a cash business, so how will the IRS know how much you won during the year?
Unfortunately for gamblers, casinos, lost 2020 dollars gambling tracks, state lotteries, bingo lost 2020 dollars gambling, and other gambling establishments located in the United States are required to tell the IRS if you win more than a specified dollar amount.
They do this by filing a tax form called Form W2-G with the IRS.
When a W2-G must be filed depends on the type of game you play.
Thus, if you have one or more wins exceeding the reporting thrseshold, the IRS will know that you earned at least that much gambling income during the year.
The Rules Differ for Professional Gamblers If you gamble full-time to earn a living, you may qualify as a professional gambler for tax purposes.
Professional gamblers inhabit a different tax universe than those who gamble for fun.
In general, gambling pros are treated better by the IRS than amateurs, but few people qualify as gambling professioanls.
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TOP 6 BIGGEST MONEY LOSSES EVER! +400,000$
Gambling (also known as betting) is the wagering of money or something of value on an event... Gamblers gamble more money to try to win back money that they have lost and... This page was last edited on 6 January 2020, at 00:26 (UTC).
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