A little tax help please

mrmarcus -- you are so wrong and Sue is so right. Get over it.

The difference here is "certain gambling winnings" as opposed to "miscellaneous income". If you used a 1099 like a W2g and didn't get caught by the IRS then you just got lucky. Period.

I hope everyone here is smart enough to disregard your rantings.

Agreed with everything Sue and Mare posted.


There is a valid point to be argued about receiving a 1099 for income that was an indirect result of gambling. If you win money in a slot tournament that you were invited to as a direct result of previous gambling activity, you could make the valid argument that the 1099 income was a direct result of gambling (ie. that non-gamblers wouldn't have had the opportunity to play and win in the tournament), and attempt to write off gambling losses against that 1099 income. That said, you're waving a huge red flag at the IRS and asking to be audited.

If you go down that road (and for some high stakes players it might make sense to try (ie. they won $50,000 in a tournament, but had more than that in gambling losses)) and you won a significant amount in a tournament and wanted to be able to write off gambling losses against that win, make sure you have a tax advisor who is well versed in tax laws as they relate to gambling, as you'll need that person to fight for you when you get audited. Keep any documentation relating to the tournament such as flyers that say, "play 50 hours of poker to be invited to our tournament", or "get a qualifying hand at the Let It Ride table to win a seat in our tournament," to help prove that your gambling activity resulted in the eventual tournament win.

For a $750 tournament win? I think you're going to be stuck like I was a few years back and you'll have to pay taxes on it -- it's not worth the potential headache to try and write that off (in this writer's opinion).

Disclaimer: I am not a tax advisor. You should consult a qualified professional tax advisor if you have questions about your taxes.

Extremely funny!

Don't hurt your head, Sue, banging it on a brick wall.

We should crown you.........Saint Sue..........after attempting to clairfy your posts with that person.
You have more patience than I do. lol This is what I'd be doing..........

Ouch!

If your contest winnings from a casino are a direct result of having to gamble to get those winnings then they can be claimed as gambling winnings. The best example is you have to get so many points on your players card to gain entry. If you use turbo tax it will walk you right through it. The 1099 amount does not have to be entered as misc. income, it is entered under gambling winnings without a w2g. I have talked to a tax attorney about this, he concurred, and I've never been audited.

Welcome to the forums, thlf.

I don't disagree in principal that one should be able to deduct gambling losses against tournament or other prize income from a casino that was a direct result of gambling, however:

A) TurboTax does not 'walk you right through' doing that scenario. (It does allow you to easily write off losses against your W-2G total, but nothing about 1099-MISC casino income.)

B) If you receive a 1099-MISC from a casino, you need to report it or you're asking to be audited. The IRS gets a copy of that 1099-MISC that the casino sends to you. It's fantastic that you haven't been audited, but in my opinion it is not advisable to not declare a 1099-MISC form that you received.

Again, I am not a tax professional, and the opinions expressed are my own. Please consult a qualified tax professional for questions about your taxes.

This is 100% correct. Make a note on your tax filing why you have entered the 1099 as gaming winnings and not miscallaneous income.

These comments are very interesting. I will add my two cents. I am an attorney and am pretty up on tax law. Gambling winnings are reported on a W-2G. Prizes are reported on a 1099. You can claim these items any way you desire on your tax return but if you are audited you will have a problem. It will not be a big problem but it will be a problem. The auditor will not buy that prize winnings reported by a casino on a 1099 can be offset by gambling losses. The prize being discussed is akin to winning $750 in a bowling tournament for which you will get a 1099. It will be tough to win any argument that the prize was the result of gambling so it can be offset. If that were the case the casino report on a W-2G.

Thank you, Fingerstim.