Gambling & Sports Betting In The US

[TheDA]

Is gambling and sports betting in the US taxed for the individual?

Has it always been like this in recent times.

[L-Pink]

Any income is taxable.


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[TheDA]

Originally Posted by L-Pink

Any income is taxable.


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So are you allowed to write-off losses?

[L-Pink]

Originally Posted by TheDA

So are you allowed to write-off losses?

All gambling winnings are fully taxable.

Gambling income includes, but is not limited to, winnings from lotteries, raffles, horse races, poker tournaments and casinos. It includes cash winnings and also the fair market value of prizes such as cars and trips.

A payer is required to issue you a Form W-2G if you receive certain gambling winnings or if you have any gambling winnings subject to federal income tax withholding.
Even if a W-2G is not issued, all gambling winnings must be reported as taxable income. Therefore, you may be required to pay an estimated tax on the gambling winnings. For more information on paying estimated taxes, refer to IRS Publication 505, Tax Withholding and Estimated Tax.

You must report your gambling winnings on Form 1040, line 21.

If you itemize your deductions on Form 1040, Schedule A, you can deduct gambling losses you had during the year, but only up to the amount of your winnings. Your losses are not subject to the 2 percent of AGI Limitation.

It is important to keep an accurate diary or similar record of your gambling winnings and losses. To deduct your losses, you must be able to provide receipts, tickets, statements or other records that show the amount of both your winnings and losses.


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[Varius]

Regardless of where you go to gamble, remember that your winnings are taxable income. You can,however, deduct your losses, up to the amount of your winnings, to help ease the tax bite.

IRS Publication 529 suggests you keep a gambling diary, recording your winnings and losses separately.

Actually, the IRS says you "must" keep such records if you want to guarantee that you meet reporting requirements and ensure your deductions aren't disallowed.

According to Publication 529, for tax purposes your gambling diary should contain at least the following information.

The date and type of your specific wager or wagering activity. The name and address or location of the gambling establishment. The names of other persons present with you at the gambling establishment. The amount(s) you won or lost.

In addition to your diary, you should also have other documentation. If you win enough, you'll get a Form W-2G, Certain Gambling Winnings, from the paying casino, track or other payor.

You also can verify your winnings by showing wagering tickets, canceled checks, substitute checks, credit records, bank withdrawals and statements of actual winnings or payment slips provided to you by the gambling establishment.

For certain wagers, the IRS also offers some specific record keeping suggestions.

Keno: Copies of the keno tickets you purchased that were validated by the gambling establishment, copies of your casino credit records, and copies of your casino check cashing records.

Slot machines: A record of the machine number and all winnings by date and time the machine was played.

Table games: Record the number of the table (blackjack, craps, poker, baccarat, roulette, wheel of fortune, etc.):at which you were playing. Casino credit card data indicating whether the credit was issued in the pit or at the cashier's cage.

Bingo: A record of the number of games played, cost of tickets purchased, and amounts collected on winning tickets. Supplemental records include any receipts from the casino, parlor, etc.

Racing: A record of the races (horse, harness, dog, etc.), amounts of wagers, amounts collected on winning tickets, and amounts lost on losing tickets. Supplemental records include unredeemed tickets and payment records from the racetrack.

Lotteries: A record of ticket purchases, dates, winnings, and losses. Supplemental records include unredeemed tickets, payment slips, and winnings statements.

I don't believe they currently specify online wagering as any different than offline wagering. However, it's up to you if you feel like letting them know that you are gambling online as an American Citizen

[TheDA]

So I'm guessing it's just taxed at the same rates as normal income.

[SinfullySexy]

We've never had the problem of winning to find out But I do know weve wrote of some major losses in past years....

[TheDA]

Originally Posted by Varius

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I don't believe they currently specify online wagering as any different than offline wagering. However, it's up to you if you feel like letting them know that you are gambling online as an American Citizen

I have zero plans on telling them about any of my winnings!

It was just a subject that came up in conversation today. I knew that lottery winnings were taxed, wasn't sure about the casinos and the like!