How Do You Report Gambling Winnings And Losses For Tax?
Gambling winnings are included as income for tax purposes and gambling losses may be deductible on your tax return if you itemize your deductions. The types of gambling income include amounts won in casinos, lotteries, raffles and any other legal or illegal gambling activities. Keep adequate records to show how the gambling income and the loss deductions on the tax return were determined. Receive a Form W-2G, Certain Gambling Winnings, if you had gambling income reported to the Internal Revenue Service (IRS). If you won a non-cash prize, the fair market value (FMV) of the item is shown as income on Form W-2G. Verify that the reported FMV for items like cars, boats, and campers is the selling price and not the inflated list price. Calculate your total gambling income by adding together all sources of gambling winnings including, but not limited to, amounts reported to you on Form W-2G, raffle prizes and lottery winnings. Report your total gambling winnings in Other Income on Line 21 of
