RECORD KEEPING REQUIREMENTS RELATED TO GAMBLING
(Note: There are new rules related to gambling that take effect in 2026 – see our current newsletter for updates.)
Special rules apply to casual gamblers who are not in the trade or business of gambling. Gambling winnings are fully taxable and you must report the income on your tax return. Gambling income includes (but is not limited to) winnings from lotteries, raffles, horse races, and casinos. It also includes the value of non-cash winnings or prizes.
A payer must issue you a Form W-2G if your winnings are $600 or higher ($1,200 for bingo or slot machines, $1,500 for Keno, and $5,000 from poker tournaments), however you must still report all winnings, even if you do not receive a W-2G. Therefore you must keep track yourself of all gambling activity.
In most cases, you may deduct gambling losses only if you itemize your deductions, and kept a record of your winnings and losses. The losses you deduct can not be more than the amount of gambling income you received and reported. To deduct your losses, you must keep an accurate diary or similar record of your winnings and losses, and be able to provide receipts, tickets, statements, or other records that show the amount of both your winnings and losses. Your diary should contain at least the following information:
· The date and type of specific wager or wagering activity.
· The name and address or location of the gambling establishment.
· The names of other persons present with you at the gambling establishment.
· The amounts you won or lost.
In addition to the diary, you should also have other documentation such as wagering tickets, cancelled checks, credit records, bank withdrawals, and statements provided to you by the casino, etc.
IRS publication 529 contains more examples of the type of documentation that is needed. Please let me know if you have any questions or concerns, this is only a general overview of the basic rules and may not apply to your specific situation.
I have reviewed the above:
Client Signature________________________________________________________Date______________________
Spouse Signature_______________________________________________________Date______________________
A payer must issue you a Form W-2G if your winnings are $600 or higher ($1,200 for bingo or slot machines, $1,500 for Keno, and $5,000 from poker tournaments), however you must still report all winnings, even if you do not receive a W-2G. Therefore you must keep track yourself of all gambling activity.
In most cases, you may deduct gambling losses only if you itemize your deductions, and kept a record of your winnings and losses. The losses you deduct can not be more than the amount of gambling income you received and reported. To deduct your losses, you must keep an accurate diary or similar record of your winnings and losses, and be able to provide receipts, tickets, statements, or other records that show the amount of both your winnings and losses. Your diary should contain at least the following information:
· The date and type of specific wager or wagering activity.
· The name and address or location of the gambling establishment.
· The names of other persons present with you at the gambling establishment.
· The amounts you won or lost.
In addition to the diary, you should also have other documentation such as wagering tickets, cancelled checks, credit records, bank withdrawals, and statements provided to you by the casino, etc.
IRS publication 529 contains more examples of the type of documentation that is needed. Please let me know if you have any questions or concerns, this is only a general overview of the basic rules and may not apply to your specific situation.
I have reviewed the above:
Client Signature________________________________________________________Date______________________
Spouse Signature_______________________________________________________Date______________________
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