Based on data from H2 Gambling Capital, as reported on The Economist, global gambling losses in 2016 amounted to $385 billion with Australia topping the list of countries with the highest losses. By the way, loss here refers to the losses of players or the gains of gambling operators. Just remember, the gambling losses you are allowed to deduct can't exceed the winnings you report as income on your tax return. For example, if you have $2,000 in winnings in 2018, but $4,000 in losses, your deduction is limited to $2,000. You can't write off the remaining $2,000, or carry it over to your 2019 return. Click here to get more details on Forms W-2G and 5754 for 2018. Double down on deductions. The good news here is that you may deduct gambling losses if you plan on itemizing your deductions. But it’s also worthy to note that as part of tax reform, the standard deduction nearly doubled for all taxpayers. That means it’s likely that fewer. We're going to help you find the answers to your questions about the new tax legislation. Today: gambling losses, mortgage interest and property taxes. 2018 6:58 AM EST.

Gambling Losses Tax Deductible 2018

The IRS views winnings from gambling as taxable income, but did you know that you’re allowed to deduct gambling losses, too? While losing money at a casino or the racetrack does not by itself relieve your tax burden, it can reduce taxes owed for your other winnings, ultimately saving you money.

How to know if you can deduct your gambling losses

Gambling loss deductions save you money by reducing your taxable income. But there’s a trick to this—you can’t claim gambling losses that exceed your winnings, as losses are inextricably linked to your winnings for tax purposes. If you have no winnings to claim, you can’t deduct your losses.

As an example, let’s say that in a given year you went gambling twice, winning $6,000 in one instance, but losing $8,000 in another. In this case, you can only deduct $6,000 from that $8,000 loss. The remaining $2,000 in losses can’t be carried forward or written off. Conversely, if you won more than you lost, you’d owe taxes on the difference between your winnings and losses as “other income”—but at least those taxes would be reduced.

(If you’re a full-time, professional gambler the requirements are different: you will report your earnings like they have resulted from a business, as self-employed income).

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Gambling Losses Tax Deduction 2018 Federal Taxes

How to claim gambling losses

Gambling Losses Tax Deduction 2018 Income Tax

Deductible gambling losses can result from online casinos, poker games, sports betting, lotteries, prize draws, horse and dog racing, and even your office fantasy sports pool. To report any of these gambling losses, you’ll be required to itemize your deductions. This makes sense if the total of all your itemized deductions exceeds the standard deduction ($12,400 for taxpayers who are single or are filing separately from their spouse). If you claim the standard deduction, you don’t get the opportunity to reduce taxes for winnings owed by deducting gambling losses.

Keep in mind that you must be able to substantiate any losses you’re claiming, which means you’ll need to keep records of your gambling.

Track your winnings and losses

You can’t just say “I lost a bunch of money gambling” to the IRS. They require you to provide records of your winnings and losses to back your claim. Therefore, you should keep track of:

• the date and time of your gambling session
• the type of gambling
• the name and location of the gambling venue
• the people you gambled with
• how much you bet, won and lost

You should also keep credit cards statements, payout slips, receipts, tickets, bank withdrawal records, and statements of actual winnings. Other documentation can include:

• Form W-2G (typically given or mailed to you by casinos after a big payout)
• Form 5754 (a form for when you’re part of a group that earns money through gambling; you might see one of these if you and your co-workers are cashing in a winning lottery ticket)

Do you or someone you know need help with a gambling problem? Call the National Problem Gambling Helpline Network (1-800-522-4700).