IRS Summertime Tax Tip 2015-02, July 6, 2015
- Gambling income. Income from gambling
includes winnings from the lottery, horse racing and casinos. It also
includes cash and non-cash prizes. You must report the fair market value
of non-cash prizes like cars and trips.
- Payer tax form. If you win, the payer may give you a Form W-2G,
Certain Gambling Winnings. The payer also sends a copy of the W-2G to
the IRS. The payer must issue the form based on the type of gambling,
the amount you win and other factors. You’ll also get a form W-2G if the
payer must withhold income tax from what you win.
- How to report winnings. You normally report your winnings
for the year on your tax return as “Other Income.” You must report all
your gambling winnings as income. This is true even if you don’t receive
a Form W-2G.
- How to deduct losses. You can deduct your gambling losses on Schedule A, Itemized Deductions. The amount you can deduct is limited to the amount of the gambling income you report on your return.
- Keep gambling receipts. You should keep track of your wins and losses. This includes keeping items such as a gambling log or diary, receipts, statements or tickets.
Additional IRS Resources:
- Tax Topic 419, Gambling Income and Expenses
IRS Podcasts:
Source: Internal Revenue Service
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