Did you get a hand pay jackpot in 2022? It's Tax Season - Form W-2G

Tax Time!

Be sure to get your win/loss statements from each casino you have visited this year. Offsetting wins with your casino losses can save you big $$$

What is a Form W-2G

Form W-2G is a tax document that a casino or other gambling establishment sends to customers who had winnings during the prior year that must be reported as income to the Internal Revenue Service (IRS). Its full title is Form W-2G, Certain Gambling Winnings.

Do I have to report my gambling winnings to the IRS?

The IRS treats gambling winnings as taxable income, which must be reported on a tax return. In order to keep track of taxpayer’s gambling winnings, the IRS requires the paying entity (such as the state lotto commission, the casino, or the racing track) to report winnings over a certain threshold. If a taxpayer wins more than:

• $1,200 from a slot machine or bingo game,
• $1,500 of proceeds from keno,
• $5,000 of proceeds from a poker tournament,
• $600 of winnings from any other game where payout is more than 300 times the wager,
• or any other winnings subject to tax withholding,

then he or she can expect to be required to provide identifying information which allows the paying entity to issue an IRS Form W2G.

Form W-2G Instructions

Form W-2G will request that the taxpayer provide the following information:

• The amount of gross winnings
• The date the winnings were won
• The type of wager that was made
• The amount of federal and state income tax already withheld

When filing his or her tax return, the taxpayer will need to add up all IRS Form W-2Gs received in that year, along with any smaller gambling winnings that may not have triggered an IRS Form W-2G requirement. The taxpayer will also be required to include those earnings as “Other Income” on the first page of his or her IRS Form 1040 return. Even if you don’t receive a W-2G in the mail before tax season rolls around, you will still be legally obligated to report your earnings on your year-end tax return. Keeping careful track of all of your financial documents, such as wager statements, payment slips, and other gambling receipts, will ensure that you’re able to accurately report your earnings come tax time.

Are gambling losses tax deductible?

Maybe you enjoy gambling, but you’re not always so lucky with your winnings—there is one bit of good news for you. Although you can’t report your net winnings, you can report your gambling losses as an itemized deduction on Schedule A. However, there’s a catch: losses can only be deducted up to the amount of gambling winnings in a given year.

I recommend contacting a tax professional if you have any questions about what is required in you reporting. 

Also visit: About Form W-2 G, Certain Gambling Winnings | Internal Revenue Service (irs.gov) for more information

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