Gambling Winnings and Losses

If you like to gamble, you should know that gambling winnings are generally taxable and must be reported on your tax return.

If you itemize your deductions on Schedule A, then you may also claim your gambling losses – but only up to the amount of the winnings shown on your tax return.

It’s a good idea to keep a daily log showing both your gambling winnings and losses. Make sure to keep all related receipts, tickets, and statements.

Common examples of gambling income are winnings from lotteries, raffles, horse races, dog races, and casinos.

The fair market value of non-cash prizes like cars, houses, and trips is also taxable.

Depending on the type of game and amount of winnings, the casino or other payer may withhold taxes and give you a W-2G. This will need to be reported on your tax return.

In some cases, you may need to make quarterly tax payments.

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About cozbycpa

Heather L. Cozby is a CPA on the South Shore and Cape Cod. The managing partner of Cozby & Company, LLC, Heather has the resources and experience necessary to provide quality professional services on a timely basis and at a reasonable cost. She specializes in tax planning & preparation; audit, review & compilation services; management advisory services; bookkeeping; and accounting. Her unique niche is in working with homeowners’ associations and condominium trusts, advising with rental real estate, and providing outsourced financial consulting for mid-sized companies. She is more entrepreneurial than most accountants, and offers the best of both worlds - providing the services of a larger firm while retaining the ability to connect with her clients on a personal level.
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