To avoid this, ensure all gambling income is reported.Ģ. This could result in a 20% penalty for unreported income. If you are audited, and IRS doesn’t see your gambling income, they may report it for you. If you don’t correctly report all of your gambling winnings, this could result in an audit. Why Do You Still Need to Report Your Own Taxes for Gambling?ġ.
Yes, taxes are reported and withheld, but you still need to report ALL of your gambling winnings. Think of Form W-2 G like a W-2 that you receive from your employer. While this form does ensure IRS withholds some taxes from your winnings, it does not paint the whole picture. Why is this a problem? Well, sometimes a gambler will be issued a Form W-2 G and think that their gambling winnings are reported to IRS. However, if you win a significant amount, you will be issued a Form W-2 G from the casino or gambling establishment that you frequent. If you win a small amount, it may not be an issue. Often gamblers don’t understand the significance of this question. Can You Deduct Your Losses Against Your Winnings?Ĭheck out this video for a detailed explanation of tracking gambling losses and wins. Gambling winnings are reportable on your federal and state income.ġ. It’s a simple question, but the answer is a little more complicated. Today we are going to talk about whether you must report gambling winnings on your taxes.
