• Do I Have To Report Online Gambling Winnings Money
• Gambling Winnings From Another State
• Do I Have To Report Online Gambling Winnings For Real

Nov 20, 2019 In some states, it is required of gambling winners to claim their winnings in the state where they were won irrespective of your place of domicile. Also, your state of residence will require you to report your winnings but, at the same time give a deduction for the taxes that have already been paid in the non- resident state. Specifically, your tax return should reflect your total year’s gambling winnings – from the big blackjack score to the smaller fantasy football payout. That’s because you’re required to report each stroke of luck as taxable income — big or small, buddy or casino. You are under a strict legal obligation to report all prize money, winnings, income, or awards that you've won throughout the year no matter how small. However, you need not pay tax for all winnings. Itemizing your deductions will give you the advantage of claiming your losses. The requirements for reporting and withholding depend on: Information about Form W-2 G, Certain Gambling Winnings, including recent updates, related forms and instructions on how to file. File this form to report gambling winnings and any federal income tax withheld on those winnings.

Are online gambling winnings taxable? Yes, whether you gamble at land-based or online casinos, the money you earn is subject to federal income tax. Known as gambling income, the money you earn from wagers and bets as well as lotteries, sweepstakes, etc. all must be taxed.

In some cases, you will be provided with tax forms that must be turned in to the federal government. The full amount of the gambling income minus the cost of the winning bet will be included on this form. Whether you receive this form or not, it’s important to know your responsibilities when it comes to filing income taxes.

The process of handling gambling taxes is not difficult if you know what to do. With this in mind, the OUSC team created this quicktax guide to help US players report their online gambling income.

Do US Players Have To Pay Taxes For Online Gambling?

So, if you enjoy online gambling at sites like BetOnline or Bovada Casino, do you have to pay taxes? When you choose to gamble online, the money you earn is still taxable. Even if the site is located in another country, you still have to pay taxes.

Online gambling is unregulated in most regions of the US, but taxes must still be paid. Just because you do not receive tax forms, does not mean that your winnings are not taxed.

To the IRS, it does not matter where the money is either. If you have funds in your online casino account, even if it’s an offshore site, it’s taxable. When dealing with online gambling earnings, it’s important to review this information with an accountant to ensure you pay the right amount of taxes owed.

Below you will find a list of gambling activities that the International Revenue Service considers taxable:

• Prizes
• Private Party Games
• Tournaments
• Scratch Off Tickets
• Other

How Do You Report Gambling Winnings?

The way you report your gambling activities will be dependent on how you win. If you receive a Form W-2G, then this is what you will turn in when filing taxes. Taxes must be filed before April 15th or you must ask for an extension. You will turn this form in as you do your other tax forms for employment to an accountant or tax filing company.

Do I Have To Report Online Gambling Winnings Money

If you do not receive the W-2G form, then you will need to fill out a Form 1040, adding the winnings to Line 21 of the form. The full amount of gambling winnings will be placed on this line.

When filling out the 1040, you will need to configure your losses as well. The expense you had for bets, wagers, etc. will need to be deducted as an itemized deduction. This is done on the “Other Miscellaneous Deductions” line of Schedule A form. This will help to lower the tax amount paid on your total gambling income.

What Types of Records Do You Need?

The information you record while enjoying online gambling can be used during the filing process. It’s important to maintain a log or diary of all your losses and winnings. Keep in mind the following information:

• Dates: You will need to record the date and type of activity completed, including wagers and winnings.
• Location: List the name and location of the gambling facility. In the case of online gambling, this would be the website, such as MyBookie or Café Casino.
• Checks: If you are sent any checks in the mail from winnings, be sure to keep the check stub.
• Paperwork: For some players, winnings will be sent via mail and any paperwork should be kept and used during filing as needed.

Don’t Forget To Pay Your Online Gambling Taxes

When you gamble online, it is important to enjoy yourself, but also remember to file your winnings! The IRS takes gambling money very seriously and you want to be sure that you pay your taxes accordingly. If you need any additional information, be sure to visit the official website of the IRS to find all the previously mentioned forms you will need fo file your taxes.

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hi. i live in a state where online gambling is illegal and i like playing at brovada. Is it not silly to report winnings and losses as far as taxes go seeing as how that would let everyone know that you are participating in something that is 'illegal'? I don't want to stop playing at brovada but don't want to get arrested either. Any advice is greatly appreciated, thanks

If you are in Washington, I would be careful, I think its a felony. I don't know that you have to tell the IRS exactly where you are gambling. As long as you pay your taxes I doubt they will care. Just file gambling winnings. If you are winning a fair amount and depositing checks in your bank account, I don't know how you will explain that if you are ever questioned. Find a way to Pay the taxes period.I think the tax advice here on the forum tends to be overly cautious. I recall helping a friend with some online gambling. Her net winnings for the year were about 10k, plus she had regular earned income. We consulted her tax CPA, and I insisted that she should report winnings, but the CPA thought I was insane. Ordinary people do not report winnings unless W-2Gs are involved, and even then they only report the total of the W-2Gs.
If you don't report, the question is what happens if you get caught. As long as you can plausibly claim ignorance, then the risk should be minimal (i.e., interest and penalties only, no criminal charges). Especially if the winnings blend with other sources of income.
The legality of playing online should be a non-issue. It's hollow government intimidation. You're not doing anything wrong, and no one has been prosecuted.
If you do choose to report the income, the challenge is to interpret the vague tax code. In theory, your gambling income is the total of all winning sessions, but the definition of a session is unclear, so you'll need to use your own judgment. Of course you can deduct losing sessions against the declared winnings, but only as an itemized deduction.

1.) With respect to Federal taxes, gambling losses can only be used to offset gambling winnings, thus, if you have lost money overall, then you have nothing to report in the first place.

Sorry Mission, this is not true. If you win $100 in January but lose $500 in March, officially you are still required to report that $100 as gambling income, and then deduct $100 (out of your $500 loss, since you can only offset wins) as an itemized deduction. Your net tax liability on gambling is $0, but your AGI will blow up if you gamble a lot as an amateur. It sucks.

Gambling Winnings From Another State

Now if you your numbers are actually $100 and $500, then don't bother. But if they were $30,000 and $40,000, I would probably bother. But that's me.

3.) Technically, an individual is legally bound to report ALL winnings to the IRS and then offset their winnings with losses as appropriate. I'm not saying not to report all of your winnings to the IRS, but in reality, most people don't. They only report the winnings that the casinos themselves are required to report, anyway, and then offset those with losses, as appropriate.

I report all of my winnings and losses from table games. I've never had a W-2G. I mostly do this because I generate several CTRs each year (generally 2 per Vegas trip) and I fear the audit. Keep good records, etc.I just read the thread from post #1.
Mostly accurate advice, as amended.
State where you live is first consideration.
Making sense of the Federal regulations is next ( they are vague, either stupid or intentionally vague ).
For a couple K, don't sweat it. Keep good records, keep immaculate records, then try to follow the Regs as best you can and be prepared to explain your logic. There is nothing illegal, as far as I know, about keeping multiple sets of records which don't necessarily drill down to the truth. What is the truth? For tax audit purposes the truth is what you turn over and they accept ;-)
Get into tens of thousands, hire a professional who specializes in this area of tax law ( most don't have a clue ).
Press your bets, buy an island, declare a new republic, and ask the USA for assistance as you become an Ally.

Do I Have To Report Online Gambling Winnings For Real