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How much can you claim in gambling losses?

Limitations on loss deductions The amount of gambling losses you can deduct can never exceed the winnings you report as income. For example, if you have $5,000 in winnings but $8,000 in losses, your deduction is limited to $5,000. You could not write off the remaining $3,000, or carry it forward to future years.

turbotax.intuit.com - Can You Claim Gambling Losses on Your Taxes? - TurboTax - Intuit
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OVERVIEW

Gambling losses are indeed tax deductible, but only to the extent of your winnings. Find out more about reporting gambling losses on your tax return.

Claiming gambling losses

Gambling losses are indeed tax deductible, but only to the extent of your winnings and requires you to report all the money you win as taxable income on your return. The deduction is only available if you itemize your deductions. If you claim the standard deduction, then you can't reduce your tax by your gambling losses.

Keeping track of your winnings and losses

The IRS requires you to keep a log of your winnings and losses as a prerequisite to deducting losses from your winnings. Your winnings include each win during the year. You typically cannot offset your winnings from one day with your losses from another day in order to report your net winnings or losses. Your winnings and losses typically need to be separated and reported individually. The IRS does allow you to net your wins and losses on the same day for the same type of wagering if you meet certain requirements. This means that if you win at the slots one day and lose the next day, you have to report the winnings on your tax return as income and then deduct the losses separately as an itemized deduction.

Typical sources of winnings and losses can include:

lotteries

raffles

horse and dog races

casino games

poker games

sports betting

Your records need to include:

the date and type of gambling you engage in

the name and address of the places where you gamble

the people you gambled with

the amount you win and lose

Other documentation to prove your losses can include:

Form W-2G

Form 5754

wagering tickets

canceled checks or credit records

receipts from the gambling facility

Limitations on loss deductions The amount of gambling losses you can deduct can never exceed the winnings you report as income. For example, if you have $5,000 in winnings but $8,000 in losses, your deduction is limited to $5,000. You could not write off the remaining $3,000, or carry it forward to future years. Reporting gambling losses To report your gambling losses, you must itemize your income tax deductions on Schedule A. You would typically itemize deductions if your gambling losses plus all other itemized expenses are greater than the standard deduction for your filing status. If you claim the standard deduction, you: are still obligated to report and pay tax on all winnings you earn during the year

will not be able to deduct any of your losses

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Do you have to pay tax on sportsbet?

The current tax rate is 15 per cent of the net NSW wagering revenue that exceeds the financial year threshold for bets placed in NSW. The annual threshold: applies as a reducing balance from the start of the financial year. can't be carried over to another period.

revenue.nsw.gov.au - Point of consumption tax | Revenue NSW

Point of consumption tax

From 1 January 2019, if you're a betting service provider licensed in Australia, you must pay a point of consumption tax on all bets made by customers located in NSW at the time the bet was placed:

in person

online, or

by phone.

Bets include:

bookmaker

betting exchange

totalizator

lay-off bets

free bets.

Betting service providers include:

bookmakers

a person who operates a betting exchange

a person who operates a totalizator.

There are no changes to betting tax and industry funding arrangements paid by the totalizator licensee. We administer the tax, issue assessments and reassessments, collect the tax and approve payment arrangements. If you’re dissatisfied with an assessment or decision we’ve made, you can lodge an objection or request a reassessment. Liquor and Gaming NSW is responsible for betting service providers complying with the point of consumption tax.

Tax rates and thresholds

The current tax rate is 15 per cent of the net NSW wagering revenue that exceeds the financial year threshold for bets placed in NSW. Date Rate From 01/01/2019 to 30/06/2022 10 per cent From 01/07/2022 15 per cent Date Threshold From 01/01/2019 to 30/06/2019 $500,000 From 01/07/2019 to 30/06/2020 $1 million

The annual threshold:

applies as a reducing balance from the start of the financial year

can't be carried over to another period.

More information

Point of consumption tax is legislated under Part 4 of the Betting Tax Act 2001.

If you have questions about the point of consumption tax, contact us.

For enquiries about compliance audits, contact Liquor and Gaming NSW.

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