Gambling Winnings

Money received from gambling wins is fully taxable. It should be reported on Form 1040, Line 21 if you the winner is not a professional gambler. All the gambling wins, like gambling losses should be well documented using an accurate diary. The diary should have all the details that IRS needs. It should be well supported by other documents. If you itemize your tax deductions on Form 1040, Schedule A, as you are supposed to do, you have the opportunity to deduct any gambling losses up to the amount of your gambling winnings on your tax return. If you have no gambling winnings in that particular tax year then you cannot deduct the gambling losses on your tax return. The tax deduction on your tax return is then not subject to the 2% AGI floor.

Gambling winnings from lotteries and other such gambling games are taxable gambling winnings which should be included on your tax return. In addition to gambling winnings that involve cash, one must include on the tax return bonds, cars, houses, and other non-cash gambling winnings at their fair market value, and also include these things. An accurate report should be maintained on this also.