Well, I was able to deduct my session losses from earnings for the IRS, but the corrupt bankrupt piss hole known as the appropriately named Land of Lincoln does not have a provision to deduct gambling losses, so I'm on the hook for about $450 in extra taxes paid to Illinois, or 5% of the session winnings for 2014. They can sit and spin until April, or 15 months earlier than they would pay me if I was a vendor to the state, which is annually among the top five states (this year #1) in losing net residents. Fifty percent of Illinoisans said that if given the chance to move to a different state, they would. Nearly 20 percent said they already planning to depart. I have definitely cut back on gambling due to taxes. Wished we were like most civilized nations and exempt gambling, mostly a negative expectation pursuit, from income subject to tax.
Yup, same thing here in WI. They used to follow the Fed, you could deduct losses vs wins, then once they started a WI state lottery, that deduction went bye-bye. Hypocrites!! And we are at 6.5% on those W2gs.
well if you are talking about 1200 bucks to offset with losses... I dont think its worth providing all that paperwork to the IRS is worth it.... Unless you are talking about 100k +..... Ive talked to my friends that are CPA's and to offset it, its really a hassle and usually isnt worth it...
Chess, not sure what you are saying here. I've deducted losses up to $20k to offset wins. Never been audited, never gave it a second thought. Not any hassle involved. If called in, a detailed gambling log is plenty of proof, although I admit in 25+ years of declaring gambling losses to offset winnings, I have never been audited.
Sorry Joe... maybe I am way off or he was way off.... I probably should have said I wanted to write off the losses.. but not with the wins... hopefully that makes a little more sense... I had all losses one year, and wanted to write it off.. about 8k..... He said you have to keep a ledger, etc etc... to me it wasnt worth it... thats MO.... It could be completely off base
I have to be in compliance, as I have a job in finance and would not want to jeopardize it with tax issues. I've tracked gambling activity for my personal knowledge / records, but after I hit my first W-2G and learned about the tax filing compliance issues involved, including the fact that you are required to report the sum of your positive sessions, beyond the session(s) for which your W2-G was issued, regardless if you are a net winner or loser during the year. I feel it is too onerous to gamble regularly. It will save me money in the long run, and I enjoy the limited gambling trips to Vegas regardless. I had two positive sessions for about $2.5K in January, and will try to minimize gambling during my second and final trip to keep Illinois at a few hundred dollars ($125 due now @ 5%). It's hard enough to beat the house vig, there is no way to also overcome 5% on all winning sessions (or 3.75% if they don't try to reverse the tax rate change). I remember you having to cut back as well in order to not adversely impact your health insurance premiums. There would be few if any gamblers if everyone followed the tax requirements related to gambling. Perhaps someone will challenge this one day, a High Roller who the IRS will fight to declare $20M after losing $30M, or $10M net on the year.
I didn't think you could write off any losses beyond your winnings (maybe unless you are a professional gambler, but you couldn't do that for too many years). I was trying to state that approved donations like Good Will can always be deducted whether you have gambling wins or not. So the only true offset to gambling wins are gambling losses.
Don't forget to double check your W2-Gs vs what CET has online. They overstated mine by more than $7k. I rarely play slots and I've only won "W2"-big twice on the tables so I know my exact total. I'm still in the process of getting CET to fix it. I told someone else about it and it looks like hers is overstated as well. So, better check yours before they send it out to the IRS at the end of Feb.
Actually IRS.gov has a w2G instruction sheet which is quite helpful. You are correct on the losses but only if you itemize deductions. Now if your total adjusted gross income is above the threshold, it will reduce your itemized deductions not giving you full value for the Goodwill and other deductions.
Are you referring to the win loss statements? I need to check that myself, never thought to compare. I did complare my gambling log to my total W2Gs and realized I left one off on my taxes. I use the win loss statements to support my gambling log losses (unfortunately)
Joe that is great to hear about audits. I also keep a detailed gambling log with dates, denominations, machine # and locations. I do it on a trip by trip basis and keep up with gains or losses. I was on the gain side until the last three trips of the year. Ouch. I've only had W2Gs the last three years since upping denominations, so I wasn't sure what to expect on auditing.
Joe, one more question. Do you mail your returns and include the W2Gs? I have to many W2Gs this year to efile but it doesn't look like they are required mail in unless they have federal tax taken out
Thanks for the reply. I am in the same boat but worse this year. I had several big hits in Bossier City and Tunica this year. I understand I can't get Mississippi back but didn't realize until recently that you are supposed to file LA if you have won. Guess I will try this year.
As a Texas resident, you don't have to file an out of state LA return. However, if you hit big or many W2Gs in LA, then it is in your best interest to at least run the numbers to see how much you can get back. You won't get all of the 6% they already took out. But you can get a good chunk of it.
Too many to efile? Never knew there was a limit and I have plenty. No, you do not need to send in our W2Gs
