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- 1099 For Gambling Winnings
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Feb 01, 2013 Hello again, It is true that gambling winnings are gambling winnings and do need to be reported. However, how you report them depends on whether you are considered a professional gambler, or not, which you stated that you are not. It seems odd that they would report the gambling winnings on 1099-misc instead of a W2g, but ok. Generally, gambling winnings paid to a foreign person are subject to 30% withholding under sections 1441 (a) and 1442 (a) and are reportable on Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons, and Form 1042-S, Foreign Person's U.S. Source Income Subject to Withholding.
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Catman88
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
Can gambling losses be deducted from 1099-MISC?Posted by Catman88 on 1/29/13 at 7:26 am
The IRS says that Cash and Trips count. But I didnt get a 1099-G for my wife winning 4 plane tickets to the carribean (they valued at 4001). They sent a 1099-MISC. So Im not sure how that will work thats a trip we won. I would think I would be able to deduct anything I lost but not sure if the lack of -G will be problematic. Since it was won through a radio station and not a casino does that not count?
yellowfin
Chicago Cubs Fan
Coastal Bar
Member since May 2006
93046 posts
Chicago Cubs Fan
Coastal Bar
Member since May 2006
93046 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by yellowfin on 1/29/13 at 7:36 am to Catman88
Did you pay for a chance to win the trip or just got lucky by being 'caller #8'? The second isn't gambling
Catman88
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by Catman88 on 1/29/13 at 7:48 am to yellowfin
My wife entered via email so yea not gambling. Also looking into the BS amount of 4001 for 4 tickets. The cost if I were to book today would be 2327.60 for the 4 tickets we used. So looking at putting an adjustment of FMV of -1672.40 with 2 used for a trip to St Thomas/St John and 2 for a trip to Nassau. Im not sure where in the Carribean you would pay 1000.25 per person to fly to. I did print out the booking data from delta.
BACONisMEATcandy
LSU Fan
Member since Dec 2007
46205 posts
LSU Fan
Member since Dec 2007
46205 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by BACONisMEATcandy on 1/29/13 at 8:44 am to Catman88
quote:
Im not sure where in the Carribean you would pay 1000.25 per person to fly to. I did print out the booking data from delta.
Depends on the fare class of the ticket... There are more than you think
LINK
Catman88
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by Catman88 on 1/29/13 at 10:30 am to BACONisMEATcandy
These were economy tickets only. Didnt have the option to book another category. What is crazy is that they valued them at 4k but they dont bother take into account that we literally had 2 days only to book. They were giving away tickets that were purchased on points that were expiring on a friday and they awarded them on a Wed.
iAmBatman
USA Fan
The Batcave
Member since Mar 2011
9297 posts
USA Fan
The Batcave
Member since Mar 2011
9297 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by iAmBatman on 1/29/13 at 10:49 am to Catman88
Gambling losses can be deducted only up to your winnings.
Example:
You win $5,000 in 2012 and lose $7,500. You can only deduct $5,000 of the losses.
You win $5,0000 in 2012 and lose $4,000. You can deduct the whole $4,000 since it is less than your winnings. You would be responsible for taxes on the remaining $1,000 of you winnings.
Example:
You win $5,000 in 2012 and lose $7,500. You can only deduct $5,000 of the losses.
You win $5,0000 in 2012 and lose $4,000. You can deduct the whole $4,000 since it is less than your winnings. You would be responsible for taxes on the remaining $1,000 of you winnings.
Catman88
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by Catman88 on 1/29/13 at 11:09 am to iAmBatman
Well I understand that. The question was if a prize of this matter counted as 'winnings' or if it had to be specific to gambling and putting money at risk.
If I had 25k in gambling losses and won a 25k MSRP car in a drawing vs 25k in gambling losses and won a 25k MSRP car at the casino slot.
Seems to be that they are not treated equally. In one case I would get to duduct but in the other case I would be stuck with the 25k income. At which I could claim FMV of the car as being around 19k instead of 25k.
If I had 25k in gambling losses and won a 25k MSRP car in a drawing vs 25k in gambling losses and won a 25k MSRP car at the casino slot.
Seems to be that they are not treated equally. In one case I would get to duduct but in the other case I would be stuck with the 25k income. At which I could claim FMV of the car as being around 19k instead of 25k.
C
Atlanta Falcons Fan
Houston
Member since Dec 2007
25821 posts
Atlanta Falcons Fan
Houston
Member since Dec 2007
25821 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by C on 1/29/13 at 11:21 am to Catman88
quote:
What is crazy is that they valued them at 4k but they dont bother take into account that we literally had 2 days only to book
Interesting way to reduce losses by an airlines...
Replies (0)
iAmBatman
USA Fan
The Batcave
Member since Mar 2011
9297 posts
USA Fan
The Batcave
Member since Mar 2011
9297 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by iAmBatman on 1/29/13 at 11:26 am to Catman88
quote:
If I had 25k in gambling losses and won a 25k MSRP car in a drawing vs 25k in gambling losses and won a 25k MSRP car at the casino slot.
I see what you're saying and I'm not exactly sure what the IRS uses as the definition of 'gambling.' To me, it would seem that if you paid for a chance to win something, then that would be gambling. There is also the issue of people doing those sort of raffles as a charity (like St. Jude Dream Home) and then writing off the cost of the ticket as a donation. I really don't know all the ends and outs but I'm sure Poodlebrain could fill in the gaps.
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re: Can gambling losses be deducted from 1099-MISC?Posted by sneakytiger on 1/29/13 at 11:29 am to Catman88
LINK
Prizes and awards.
If you win a prize in a lucky number drawing, television or radio quiz program, beauty contest, or other event, you must include it in your income. For example, if you win a $50 prize in a photography contest, you must report this income on Form 1040, line 21. If you refuse to accept a prize, do not include its value in your income. Prizes and awards in goods or services must be included in your income at their fair
market value.
I think the bolded part gives you your answer - the instructions are telling you to report it on a different line than where you would report gambling losses. So I don't think you can offset.
Prizes and awards.
If you win a prize in a lucky number drawing, television or radio quiz program, beauty contest, or other event, you must include it in your income. For example, if you win a $50 prize in a photography contest, you must report this income on Form 1040, line 21. If you refuse to accept a prize, do not include its value in your income. Prizes and awards in goods or services must be included in your income at their fair
market value.
I think the bolded part gives you your answer - the instructions are telling you to report it on a different line than where you would report gambling losses. So I don't think you can offset.
re: Can gambling losses be deducted from 1099-MISC?Posted by LSUchuck on 1/29/13 at 12:03 pm to sneakytiger
It is reported as other income not subject to SE taxes. Nothing can be used to offset it.
Catman88
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by Catman88 on 1/29/13 at 12:23 pm to LSUchuck
Well IRS does say that prizes are subject to FMV.
I also had to pay the international taxes to fly to Nassau. That is normally included in the ticket price. So Im guessing I could reduce the winnings by the 95 dollars per ticket I incured there as well since I have that documented. Likely I will just keep my printout of the real cost and use that to determine FMV.
I also had to pay the international taxes to fly to Nassau. That is normally included in the ticket price. So Im guessing I could reduce the winnings by the 95 dollars per ticket I incured there as well since I have that documented. Likely I will just keep my printout of the real cost and use that to determine FMV.
Replies (0)
Newbomb Turk
Navy Fan
perfectanschlagen
Member since May 2008
9961 posts
Navy Fan
perfectanschlagen
Member since May 2008
9961 posts
re: Can gambling losses be deducted from 1099-MISC?Posted by Newbomb Turk on 1/30/13 at 8:42 am to Catman88
You do not have to claim the full MSRP on your winnings. If you can document that you could have (or did) gotten the prize for a lot less, you need only claim that amount. So, if you won a car with an MSRP of $25K, but you can get a statement from a dealer that they sold that same car with the same options for $21K, that's all you need to claim.
You really should get contemporaneous documentation, however, as claiming something less than what is shown on the 1099 just might invite an audit. However, if you don't want to risk an audit (because you may have other 'iffy' items on your return), there is a method by which you can call the IRS and file a Form 4598 to get the prize company to issue a corrected 1099.
As far as deducting losses, you're out of luck. The IRS takes the position that sweepstakes type winning (where you don't really have to do anything but enter -- i.e., you're not putting up any of your money to get a chance to 'win') are not considered 'gambling winnings' and therefore cannot be offset by gambling losses.
You really should get contemporaneous documentation, however, as claiming something less than what is shown on the 1099 just might invite an audit. However, if you don't want to risk an audit (because you may have other 'iffy' items on your return), there is a method by which you can call the IRS and file a Form 4598 to get the prize company to issue a corrected 1099.
As far as deducting losses, you're out of luck. The IRS takes the position that sweepstakes type winning (where you don't really have to do anything but enter -- i.e., you're not putting up any of your money to get a chance to 'win') are not considered 'gambling winnings' and therefore cannot be offset by gambling losses.
Catman88
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
LSU Fan
Baton Rouge, LA
Member since Dec 2004
49125 posts
Irs 1099 Gambling Winnings
re: Can gambling losses be deducted from 1099-MISC?Posted by Catman88 on 1/30/13 at 10:26 am to Newbomb Turk
Yea I dont have anything fishy on my return. Pretty standard return. Have all documentation. Would rather not pay 400 extra in taxes because they pulled a number out of thin air. 4 tickets 1k each. How fricking lazy was that.
Gambling Winnings Form 1099
Newbomb Turk
Navy Fan
perfectanschlagen
Member since May 2008
9961 posts
Navy Fan
perfectanschlagen
Member since May 2008
9961 posts
Can Gambling Winnings Be Reported On 1099 Misc
re: Can gambling losses be deducted from 1099-MISC?Posted by Newbomb Turk on 1/30/13 at 2:10 pm to Catman88
Call the IRS, present your documentation and they may have the prize company issue a new 1099.
Again, your shit-out-of-luck with the gambling losses.
Again, your shit-out-of-luck with the gambling losses.
Replies (0)
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