Therefore, many gamblers want to make sur e they know how to prove gambling losses to the Internal Revenue Service (IRS) or any tax office around the world.

Keeping a gambling diary, and specifically, tracking your gambling losses is a powerful tool in obtaining deductions of what you owe to the state or federal government at the end of the tax year. If you know how to prove gambling losses, you can get various financial incentives from your tax office and even use gambling losses in bankruptcies. Keeping a track of your gambling winnings and losses is an important part of being a gambler. Keep a Gambling Diary to Track Gambling Losses Perhaps now you’re wondering how you can prove gambling losses on your taxes, here are some things to keep in mind. Luckily, certain amounts of losses can be deduced from one’s taxes. However, players shouldn’t forget that gambling is more than a hobby – it is a real money game and, as a result, is fully taxable. I buy the principle behind some of those methods, but I've never seen anybody say they actually did it themselves.Gambling is an increasingly popular pastime in the USA and beyond because of how fun and thrilling it can be. So it's more advantageous for them to find a way to put zero on that line than it is to report the W2G amount and then offset it with a deduction.

One reason people might want to do that is that the number on Line 7 is included in your AGI which can affect how much you pay for Medicare and other things (like maybe how much tax you have to pay on Social Security benefits). There are other methods people claim are valid that involve reporting zero on Line 7 and attaching an explanation that you had a net loss, etc. But it gets you out of paying Federal taxes on the handpays when you didn't end up keeping any of that money - you lost it all back and another $9,524 on top. So you would only be able to claim $42,278. You're only allowed to deduct losses up to the amount of wins, so I couldn't deduct $14,418, I could only deduct $9,463. I had $9,463 in W2Gs and a net loss of $14,418 for the year. Since you had a net loss for the year, if you itemize deductions (and I would say you should), you can offset all of the W2G amount on Sch A.

Somebody may manually look at it, or the system just says nuh-uh and sends you a letter saying 'You underreported, you owe us $X, either send it in or dispute it.' If the number on that line doesn't match the total of W2-Gs casinos have reported to them, your return is going to get kicked out for review. The IRS is going to expect to see $47,278 on the Other Income line. Click to expand.Right, so in that case, and let's assume that your Caesars W/L represented all your gambling activity.

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