Way to Claim Gambling Losses in Taxes
The answer is yes. You can claim your gambling losses on your taxes. However, the losses are deductible only up to the amount of your gambling winnings which is reported on your return. One can claim gambling losses on IRS Form 1040, Schedule A.
If you want to claim gambling losses to offset your winnings you must keep records of your all the money which you have won as a gambling income. This deduction is available only if you are eligible to itemize it. If one want to claim the standard deduction can’t claim his/her gambling losses.
As per the requirements of the Internal Revenue Service (IRS) you should keep a record or diary of your income and losses which have occurred from the activities of gambling. Gambling income includes not only winning from lotteries, raffles, horse race and casinos but also cash winnings and fair market value of prizes like cars or trips.
The diary to keep record must contain all information of gambling like its date, types, name and address of the place where the gambling activity took place or the amount you won or lost. You should keep records of your winnings from the gambling separate from the losses from gambling.
If you are going to claim gambling losses you should have good proofs to claim it. These proofs include tickets, statements, documentations, checks, casino receipts, etc. To get more information on gambling losses and income you should refer IRS Publication 529 carefully on the official website of the IRS. One can call IRS on 800-829-3676.
Examples of some Gambling Winnings:
- Game shows
- Off-track betting
- Poker Tournaments
- Slot Machines
- Casino games
- Betting pools
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