With the number of legal casinos all over the country, many more people are trying their luck and winning at the slots, horse races, and even the game tables.

Depending on the game you play, if you win, you are required to declare your winnings and you can take an itemized deduction for the amount of your losses not to exceed your winnings. If you are issued a Form W-2G for your winnings, you MUST include that form on your income tax return. A certain way to insure an audit is to forget to include your W-2G on the tax return.

You should keep a diary of your gambling habits as well as copies of losing tickets if you want to substantiate your losses with the IRS.

 
This information is provided in an effort to help you gather and organize the information necessary to file your individual or small business income tax return. While these financial tools are not a substitute for financial advice from a qualified professional, they can be used as a starting point in your decision making process.