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So when you win $1,200 or more on a slot machine, you fill out IRS paperwork. But do you file the same paperwork when you win, say, $1,500 on a single hand of blackjack? Surely all table games aren’t exempt from the IRS?
As we all know, the Internal Revenue Service requires the casinos to report wins of $1,200 or more on slot and video poker machines. For horse and dog racing, jai alai, state lotteries, and some other kinds of wagering, the W-2G form must be issued for any winnings that are at least 300 times the amount of the bet.
So to answer the first question, if you're playing blackjack, craps, roulette, Pai Gow Poker, or any other table game, you'll never be issued a W-2G for any size of a win. You simply can't win 300 times your wager at any table game, besides those with a big side-bet or progressive jackpot, for which you will receive a W-2G.
Now, does that mean that table games are exempt from the IRS? Hardly.
Nothing is exempt from the IRS, at least in terms of winnings at gambling. And maybe more. As Jean Scott's attorney sister says, "I had a tax professor who taught us that if you find a penny on the sidewalk, it's taxable."
As we reiterate in almost every question we answer about taxes, you, the gambler, are on the hook to pay taxes on all of your winnings, whether or not you receive a W-2G, 1099, or any other IRS form. Not only that, you have to keep an accurate diary, with session records entered in real time (in other words, not reconstructed at the end of the year if the IRS comes calling) that you can show the government in the event you're questioned about your wins and losses.
And, as always, we recommend Jean Scott's book Tax Help for Gamblers, which answers all these questions in great detail.