MichaelBluejay
MichaelBluejay
Joined: Sep 17, 2010
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Thanks for this post from:
ChumpChange
February 2nd, 2019 at 5:42:10 AM permalink
Quote: BV3273

Here is what it says on my win/loss statement:

Casino Game Activity
Monies taken to: $1,310,528.73
Monies taken from: $1,299,835.52
Total: ($10,693.21) - This is a loss for 2018

W-2G Total: $318,684.50

BV3273, there's a lot of myth and misinformation floating around about gambling taxes. Here's how you should handle it, according to the IRS:

(1) Report your $1,299,835.52 wins on Schedule 1, Line 21.

(2) Report $1,299,835.52 as losses on Schedule A. Your losses were more than this, but you can't claim more in losses than you won.

(3) Even though these cancel, with no net win so you owe no tax, don't be tempted to not report it. Do report your win and your loss, otherwise you face the risk of penalties.

(4) Ignore your W-2G. It's irrelevant.

For more, see my detailed article on the subject.

All members, please don't ask any questions about this until you've actually read the article.
BV3273
BV3273
Joined: Jan 31, 2019
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February 2nd, 2019 at 6:22:56 AM permalink
Iíll run it by my accountant again before I file. I donít understand how if I win $1 it registers and Iím liable to pay taxes for that even though I had a loss for the entire session. My transaction diary that I printed shows that the entire session in question took place over one day.
MichaelBluejay
MichaelBluejay
Joined: Sep 17, 2010
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February 2nd, 2019 at 6:32:00 AM permalink
Quote: BV3273

I donít understand how if I win $1 it registers and Iím liable to pay taxes for that even though I had a loss for the entire session.

You're not. Wins are the total of session wins, losses are the total of session losses. That's made clear in the article.

If you're using a report from the online casino, then it lists a figure for all wins, and a figure for all losses, and you can use that instead of session accounting. In your case, your losses on the casino report exceeded your wins, so you have no tax liability, as I mentioned in my earlier post.
FinsRule
FinsRule
Joined: Dec 23, 2009
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February 2nd, 2019 at 6:35:36 AM permalink
I thought the issue was state taxes
BV3273
BV3273
Joined: Jan 31, 2019
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February 2nd, 2019 at 6:36:14 AM permalink
So why are you stating that I have to report the 1.31 mil in wins listed on my win/loss versus the $318k on the W2G I received?
CrystalMath
CrystalMath
Joined: May 10, 2011
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February 2nd, 2019 at 6:40:28 AM permalink
Quote: BV3273

Iíll run it by my accountant again before I file. I donít understand how if I win $1 it registers and Iím liable to pay taxes for that even though I had a loss for the entire session. My transaction diary that I printed shows that the entire session in question took place over one day.


If you played only one session and you had a loss, then you donít need to report anything under the session accounting rules. Expect to get a letter from the IRS, though.
I heart Crystal Math.
unJon
unJon
Joined: Jul 1, 2018
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February 2nd, 2019 at 6:41:54 AM permalink
Quote: CrystalMath

If you played only one session and you had a loss, then you donít need to report anything under the session accounting rules. Expect to get a letter from the IRS, though.

This is correct.
The race is not always to the swift, nor the battle to the strong; but that is the way to bet.
BV3273
BV3273
Joined: Jan 31, 2019
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February 2nd, 2019 at 6:47:40 AM permalink
Iím still going to report the $318k from my W2G. I rather have reported that then report nothing.
MichaelBluejay
MichaelBluejay
Joined: Sep 17, 2010
  • Threads: 29
  • Posts: 793
February 2nd, 2019 at 6:49:39 AM permalink
Quote: BV3273

So why are you stating that I have to report the 1.31 mil in wins listed on my win/loss versus the $318k on the W2G I received?

I am not saying that.

First, you said you had $1,299,835.52 in wins, not $1.31 mil.

Second, I said you report that figure as a win *and* a loss. Therefore you owe no tax, but somehow you're construing that as "if I win $1 it registers and I'm liable to pay taxes even though I had a loss for the entire session". I never said anything that supports that statement.

Again, you report the total of session wins as wins, and the total of session losses as losses.

Quote: CrystalMath

If you played only one session and you had a loss, then you donít need to report anything under the session accounting rules.

So true.

Quote: CrystalMath

Expect to get a letter from the IRS, though.

I wouldn't expect to get a letter from the IRS. I didn't. And if you do get a letter you can reply with a letter and that will almost certainly take care of it.

I updated the article to suggest that if your reporting doesn't match your W-2Gs, you include a note explaining that you used session accounting and referencing Shollenberger v Commissioner.
MichaelBluejay
MichaelBluejay
Joined: Sep 17, 2010
  • Threads: 29
  • Posts: 793
February 2nd, 2019 at 6:52:29 AM permalink
Quote: BV3273

Iím still going to report the $318k from my W2G. I rather have reported that then report nothing.

Yet again, no one is suggesting that you report NOTHING, certainly not me. What I actually said, and then repeated, is that you report $1,299,835.52 from the casino report.

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