How to prove gambling losses?

Forum|Forum|1 year ago
January 25, 2025
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If I play a slot machine, put in $100 (proof from an ATM withdrawl in that casino on that day), I hit a $2000 jackpot, a W2G is issued. I continue playing that slot machine and lose all of, including the $100 I started with.

I understand that I can't deduct the $100 loss (money I started with), but I can report on my tax return that I lost the $2000 to show a net of $0 gain.

My question: how do I prove that I lost all $2000 plus the $100 I started with?

I don't use a players card, so a casino statement isn't possible. I also don't have a cash out receipt (since I played until I lost all of it). Where is my proof? Other than a record on a spreadsheet I maintain?

TurboTax Premier Online

MAK70

You can prove your losses with the spreadsheet you mentioned if it has all the information require by the IRS. This includes:

The date and type of your 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 amount(s) you won or lost.

See Gambling Losses Up to the Amount of Gambling Winnings

You can also complete Form 5754, Statement by Person(s) Receiving Gambling Winnings

dhuber24Author

Does this mean it is simply the honor system any time I claim I continued gambling until I lost everything I won? As long as I document it, the IRS can't question it?

What worries me is that the IRS doesn't believe me. If I legitimately win, let's say a $20,000 taxable jackpot (and W2G issued) and then spend it all back during that same gambling session, is it possible to lose an audit because I can't prove it, other than what I documented in my spreadsheet?