You don't need to worry about which forms you need to fill out, though. Unfortunately, losses can only be deducted if you itemize your deductions.Instead, you must report your gambling income and gambling expenses separately.You don't report your gambling income net of expenses, though.Gambling winnings are unique because you can also deduct your gambling losses and certain other expenses, but only in specific circumstances ( see our article about this). payment slips from the gambling establishment.ĭepending on the size of your win, you may receive a Form W-2G, Certain Gambling Winnings and may have federal income taxes withheld from your prize by the gambling establishment.You should also keep other documentation that demonstrates your gambling activities such as, The names of other people present with you at the gambling establishment.
The address of the gambling establishment.The dates and types of specific wagers.The IRS states that you're supposed to keep a diary or similar record that details your winnings and losses, which includes information such as: Whether you play the lottery, slots, blackjack, roulette or another game considered gambling, you must report all of your winnings even if you end up losing money overall. But before you report your prize and gambling income, you need to know what does and doesn't count as income. Your winnings end up being included in your taxable income, which is used to calculate the tax you owe. That means you might have to pay taxes on those winnings. Like all other taxable income, the IRS requires you to report prizes and winnings on your tax return, too. For information on the third coronavirus relief package, please visit our “ American Rescue Plan: What Does it Mean for You and a Third Stimulus Check” blog post.
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