Legal Question in Tax Law in Pennsylvania

Why is casino earnings taxable? About 2 years ago I lost about $10,000 playing slots at a casino. Towards the end of the day, I hit $2500 in a slot machine. Of course I did not report this earning because I was still minus $7500 for that day and I did not consider this net earning. Yesterday I received a mail from the IRS asking me to pay $793 on that earning. This is unfair to me! That money is gone and I didn't really win that money. I got back some of the money that I lost. So How can they ask me to pay taxes?


Asked on 7/23/09, 1:40 am

1 Answer from Attorneys
JOHN TATOIAN LAW OFFICE OF JOHN A. TATOIAN ESQ.*Licensed Only in Massachusetts

A payer is required to issue you a Form W-2G if you receive certain gambling winnings or if you have any gambling winnings subject to Federal income tax withholding. All gambling winnings must be reported

You may deduct gambling losses only if you itemize deductions. Claim your gambling losses as a miscellaneous deduction on Form 1040, Schedule A . However, the amount of losses you deduct may not be more than the amount of gambling income you have reported on your return.

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Answered on 7/28/09, 10:47 am


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