Question

I received a 1099-K form from Paypal for online gambling. Does this need to be reported anywhere on my tax return??

Forum|Forum|4 years ago
January 29, 2022
1 reply
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I do NOT have my own business so I don't THINK this needs to be reported as "other income", is that correct? When I go to enter it under the 1099-K section it says it does not need a separate entry because it should already be included in "other income"...

TurboTax Deluxe Online

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HelenC12

Yes, you have to report your gambling winnings on your income tax return. Generally, gambling winnings are reported on form W-2G.

You may enter your gambling winnings as if you received a W-2G. See How do I enter a W-2G?

You may also enter the gambling winnings under other reportable income. Follow these steps:

Sign into your TurboTax account.
Select Federal from the left side menu.
On the Wages and income screen, scroll down to Add more income. If you don’t see this, scroll down to Less Common Income and select Show more.
Select Miscellaneous Income, 1099-A, 1099-C and Start.
On the Let’s Work on Any Miscellaneous Income screen, select Other reportable income and Start.
On the Any Other Taxable Income? screen, select Yes.
On the Other Taxable Income screen, enter a description and amount, then Continue.
On the Other Miscellaneous Income Summary screen, confirm the entry and select Done.

To check the entry, Preview your 1040. Other reportable income is reflected on Schedule 1, line 10.

After you've finished entering all of your gambling winnings, we'll ask about any losses you may have had. Losses can be deducted up to the amount you reported winning, but only if you itemize.

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hugz1Author

So just to be clear, these were $20 to $100 cash outs all added up, not one big win, which is why it's not on a W2-G. It's close to $15,000. You mean to tell me I have to claim that like it was all one big win, without being able to offset the DEPOSITS I made to Paypal, or use my online gambling losses? Thanks for the help by the way... appreciate it!

ColeenD3

Yes, you have to report your gambling income. It is irrelevant how you received the income. Reporting is yearly, much like your W-2 is a compilation of your paychecks.

The IRS provides an interactive tax assistant to help you. The requirements below must have been met.

Gambling ITA

Diary or Similar Record

You must keep an accurate diary or similar record of your losses and winnings.

Your diary should contain at least the following information.

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.

In addition to your diary, you should also have other documentation. You can generally prove your winnings and losses through Form W-2G, Certain Gambling Winnings; Form 5754, Statement by Person(s) Receiving Gambling Winnings; wagering tickets; canceled checks; substitute checks; credit records; bank withdrawals; and statements of actual winnings or payment slips provided to you by the gambling establishment.

This information is found in Publication 529, Miscellaneous Deductions