How Gambling and Taxes Work Together


All income is taxable. This includes gambling in its many different forms. No matter if its wagers in a card game, winnings from a slot machine, or results from increasingly popular fantasy sports leagues, gambling winnings will be taxed. Here are some guidelines to help in this area of finance.

All gambling winnings must be reported. The casino or business that is paying sends in their own copy of the necessary form, so the IRS will be expecting the taxpayer to do the same and declare it on their Tax Return. The taxpayer will then have the ability to deduct any gambling losses for the year too, up to the amount of income that gambling provided. This would be possible if the taxpayer kept receipts, statements, or logs that detailed wins and losses. It would seem to be a wise investment to have a tax preparer to make sure that these prizes are reported properly, and avoid losing any to penalties or fines. What do you think?

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