Checkmark iconCan I Write This Off?

Is are gambling losses deductible a valid tax write-off?

TL;DR

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

Detailed Answer

Gambling losses can be deducted if you itemize your deductions on Schedule A of your tax return. The deduction is limited to the amount of gambling income you report as taxable income. For example, if you won $5,000 from gambling and lost $7,000, you can only deduct $5,000 of your losses. It's important to maintain accurate records of both your winnings and losses, including receipts, tickets, and other documentation. This deduction is not subject to any percentage limits but cannot exceed your reported gambling winnings.

Where to Put It on the Tax Form

Schedule A, Line 16

Real World Example

A freelance writer who occasionally gambles wins $3,000 at a casino but also incurs $4,000 in losses over the year. When filing taxes, they report the $3,000 as income and can deduct $3,000 of their losses on Schedule A, provided they itemize deductions.

Audit Risk & Documentation Tips

Moderate. Taxpayers should keep detailed records of all gambling activities, including receipts, tickets, statements, and logs of winnings and losses. It's advisable to maintain a diary of gambling activities to substantiate the deduction in case of an audit.

IRS Reference

IRS Publication 529, Miscellaneous Deductions

Relevant Industries

Professional GamblersCasino EmployeesFreelancers who gamble

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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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