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Can I deduct are gambling losses deductible?

TL;DR

Gambling losses are deductible, but only to the extent of your gambling winnings and if you itemize deductions.

Detailed Answer

Gambling losses can be deducted on your tax return, but only up to the amount of your gambling winnings. This means you cannot deduct more in losses than you report as income from gambling. To claim this deduction, you must itemize your deductions on Schedule A of your tax return. Additionally, you must keep accurate records of your gambling activities, including receipts, tickets, statements, or other documentation that can substantiate your losses.

Where to Put It on the Tax Form

Schedule A (Form 1040), Line 16

Real World Example

If you won $5,000 from a casino and lost $7,000 over the year, you can only deduct $5,000 in losses, matching your winnings, provided you itemize deductions.

Calculation Required

A calculation is required for this deduction.

Calculate your total gambling winnings and total gambling losses for the year. Deduct losses up to the amount of your winnings. For example, if you have $10,000 in winnings and $8,000 in losses, you can deduct $8,000.

Audit Risk & Documentation Tips

There is a moderate audit risk with gambling deductions, so it is crucial to keep detailed records of all gambling activities, including winnings, losses, and related documentation such as receipts, tickets, and statements. Maintain a logbook or diary of your gambling activities to support your claims.

IRS Reference

IRS Publication 529, Miscellaneous Deductions; IRS Topic No. 419, Gambling Income and Losses

Relevant Industries

IndividualsProfessional GamblersCasinosEntertainment

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Disclaimer: This is for informational purposes only and should not be construed as tax or legal advice. Always consult your tax advisor.

Page created on July 15, 2025

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