IRS offers tax tips to Ohio gamblers
February 27, 2016
For example, if the gambling winnings are subject to federal income tax withholding, the payer should issue the winner a Form W-2G. “Claim gambling losses up to the amount of total winnings on Form 1040, Schedule A, Itemized Deductions, under Other Miscellaneous Deductions. Gambling winnings are normally reported on the Other income line (line 21) of Form 1040, U.S.
For more information on gambling income and losses, see IRS Publication 529 or Publication 525, Taxable and Nontaxable Income, both available at IRS.gov or by calling 800-TAX-FORM (800-829-3676).
“Gambling income, like any other income not specifically exempted, is generally taxable,” said Jennifer Jenkins, IRS spokesperson for Ohio. The records should show winnings separately from losses. Whether gambling takes place at one or more of the state’s casinos, racetracks, or elsewhere, tax consequences may follow.
“It’s a common misconception that unless you receive a Form W-2G, you don’t need to report gambling winnings on your federal tax return,” said Jenkins. You can’t simply reduce your gambling winnings by your gambling losses and report the difference — report the full amount of the winnings as income and claim allowable losses separately. Gamblers should also receive the forms when they have:
Gamblers who itemize deductions may be able to offset gambling winnings with losses – to a point. “Actually, gambling winnings must be reported. Don’t deduct gambling losses that exceed winnings,” Jenkins said.
o $1,200 or more in gambling winnings from bingo or slot machines;
o $1,500 or more in proceeds (the amount of winnings minus the amount of the wager) from keno;
o More than $5,000 in winnings (reduced by the wager or buy-in) from a poker tournament;
o $600 or more in gambling winnings (except winnings from bingo, keno, slot machines, and poker tournaments) and the payout is at least 300 times the amount of the wager.. That’s regardless of whether or not documentation was provided at the time the money was won. “That includes winnings from lotteries, raffles, horse races, and casinos. IRS Publication 529, Miscellaneous Deductions, provides details about the type of information to keep in a gambling win/loss diary and the kinds of proof that gamblers should retain in their records.
COLUMBUS, Ohio — As of this week, Ohioans have three home-grown options for casino gambling, with a fourth facility expected to open next spring. It also includes cash winnings and the fair market value of prizes, such as cars and trips,” she said.
Gamblers who plan to deduct gambling losses must have receipts, tickets, statements, and documentation such as a diary or similar record of their losses and winnings. Federal Income Tax Return.”
Gaming organizations are required to issue Form W-2G, Certain Gambling Winnings, to winners under certain circumstances