Question

1099-K PayPal and Casino Winnings

Forum|Forum|3 years ago
January 28, 2023
1 reply
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Hello - this year I found out I am

getting a 1099-K on my PayPayl transactions from casino transactions.

I use PayPal as my main source to withdraw and deposit money from the online casino.

I am already receiving a tax form for my casino winnings - but I am also receiving a 1099k from PayPal regarding the same amount, if not more.

overall I am down form

the casino - and the 1099K Makes it seem like I have made income from this, when I am already going to use my casino tax forms to report winnings/losses.

so why am I being taxed for my income twice? Also I use PayPal for a lot of things - so there are other transactions that are outside of gambling on there that money has got sent to me.

how am I supposed to report this? Vey confused and lost.

TurboTax Premier Online

PatriciaV

Employee

No, you do not need to report Form 1099-K separately if the income is already included under Less Common Income >> Prizes, Awards, and Gambling Winnings. This topic will also allow you to enter your gambling losses. If you are able to itemize your deductions, your gambling losses will be reported on Schedule A to offset your winnings.

Note: Form 1099-K is used by the IRS to track payments that you received from credit cards, debit cards, or electronic payment services (Square, PayPal, ePay, etc.). For 2022 the IRS does not require you to report these payments separately. TurboTax will not give you a separate field for the amounts reported on your 1099-K(s), which is why you need to report this income under the appropriate income topic.

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C

Confused227Author

So I am confused - am I still reporting or not reporting?

Here is my example. I have 109 K in wins - but I am overall 120 K in losses. So I can report the max up to 109.

Because I used Paypal, my transactions are showing 323K from going back and forth, which includes the gambling winning in a w2. But overall I am at a loss and do not have 323K in my account, this comes from the constant deposits and withdrawals of the same money.

So I am unsure how to go about reporting the 1099k.

PatriciaV

Employee

Yes, report all your gambling winnings, regardless of how they were reported to you. You may include whatever was in the amount on Form 1099-K unless it was also reported on a W-2. You do not need to report all the income reported on the 1099-K. If the total from the 1099-K is more than your winnings and is not another type of income you need to report, then you can ignore the rest.

The IRS expects you to report all your gambling winnings, even if you lost more than you won. Follow the instructions in the post above to report the losses to minimize the tax on your gambling activities. And keep good records to support your tax return.

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