Gambling Losses Tax Form

Gambling losses tax form

To offset the taxes applied to gambling winnings, you may list your gambling losses as a deduction on your tax return. Unlike most other deductions, gambling losses are not subject to the 2-percent limit on Form 1040, Schedule A. However, the total amount of losses you deduct cannot exceed your total winnings. It is the responsibility of anyone who casually gambles to keep track of their potential losses throughout the year and report them (on Line 21 of Form 1040) when filing taxes. Gambling establishments will automatically supply you with Form W-2G when your winnings exceed a certain amount, this must be included when filing. To enter Form W-2G Gambling Losses: Go to Screen 13.2, Gambling Winnings and Losses. Click on Losses/Misc Winnings from the left navigation panel. Enter the Total gambling losses. Note: Gambling Losses can only be offset to the extent of gambling winnings. The amount of gambling losses allowed will flow to the Schedule A, line 28.

The information in this article is up to date through tax year 2019 (taxes filed in 2020).

Every year, people flock to casinos in hopes of hitting it big. And since sports betting has been legalized, more people are engaging in gambling than before.

Gambling Losses On Tax Form

One thing to be aware of, though, is that certain winnings are taxable and are reported on IRS Form W-2 G. This document outlines your gambling winnings from a specific establishment. They should prepare the form to send to you and the IRS.

How do I get my Form W-2 G?

It’s the gambling establishment’s responsibility to fill out and submit Form W-2 G to the IRS. The copy that you receive is for you to report on your tax return. If you haven’t received your W-2 G or you lost it, contact the gambling institution to get it reissued, or contact the IRS directly since they will already have a copy.

Do I have to pay tax on my winnings?

Only winnings above a certain amount in certain games are reported on IRS form W-2 G. It is important to understand that “winnings” refer to the net amount. So, if you wager $1,000 and win $2,000, your winnings are $1,000.

Tax Form For Gambling Losses

Only winnings above a certain amount from specific games will be reported on form W-2 G. Those include:

Gambling Losses Tax Form

  • Slot machine and bingo winnings of $1,000
  • Keno winnings equal to or greater than $1,500.
  • Pokertournament winnings exceeding $5,000
  • Any lottery or sweepstakes winnings over $600
  • Any other gambling activity in which you won 300 times the wager

Are winnings withheld for taxes?

Gambling Losses On Tax Form

This simple question, like most tax-related inquiries, has a complicated answer. Gambling establishments withhold 25% of winnings for individuals who have a Social Security number on file and 28% for all others. Since these winnings are included in taxable income, the individual’s tax bracket ultimately determines how much is withheld.

Can I deduct gambling losses?

Gambling Losses Tax Form

Gambling Losses Tax Form

Yes, losses can be deducted – although you won’t receive IRS form W-2 G outlining losses. Keep records of your wagers and losses. They will be reported on Form 1040, Schedule A as “Other Itemized Deductions.” Be aware, though, that the number of losses which are deductible cannot exceed the number of winnings reported on your tax return.