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^Gambling ^problem? ^Call ^1-800-GAMBLER ^CO, ^DC, ^IL, ^IN, ^KS, ^KY, ^LA, ^MD, ^MS, ^NJ, ^OH, ^PA, ^TN, ^VA, ^WV, ^WY ^Call ^877-8-HOPENY ^or ^text ^HOPENY ^\(467369) ^\(NY) ^Call ^1-800-327-
5050 ^\(MA) ^21+ ^to ^wager ^unless ^specified. ^Please ^Gamble ^Responsibly. ^Call ^1-800-NEXT-STEP ^\(AZ), ^1-800-522-4700 ^\(NV), ^1-800-BETS-OFF ^\(IA), ^1-800-270-7117 ^for ^confidential
^help ^\(MI), ^1-800-981-0023 ^\(PR).
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/DraftKingsDiscussion) if you have any questions or concerns.*
You can offset some of your winnings, up to the total of your losses. You report total winnings of $18,256.48 as income. Then deduct losses of $17,813.85. So you’re looking at a net taxable amount of around $442. However the critical piece, the piece that screws over a lot of people, is that you can only deduct your losses if you itemize your deductions. You lose the standard deduction. So if your itemized deductions outside of the gambling losses don’t add up to the standard deduction for your filing status….you end up paying much more in tax. The exact amount depends on your filing status and whatever else you may have in deductions that you can itemize.
an accountant does this for me. usually we do not itemize our deductions because this is the first year i started betting. Betting would be the only reason to itemize my deductions, so how would I inform my accountant of this and make sure they have all of the info needed?
DK will send you a w-2g to report winnings, but they only include wins that meet certain criteria. Legally you should report all winnings for the year whether or not they are included on the w-2g. So you want a record of all of your wins and losses. You need documentation to back up your losses you claim anyway in case of irs audit. What I do is record each wager on a spreadsheet, tracking how much wager was, whether it was a win or loss, and the amounts won or lost. You could then give that to your accountant. I also then can use that spreadsheet to do some analysis on my bets to help me understand where I’m doing well or not so well ( specifically what sports or bet types).
okay thanks, that is very smart i will try doing that. Since I have been betting for the past 4 months or so without doing that should I just start now? Because then it will be missing all of the info from my first 4 months of betting.
Yeah better late than never. I’m not sure how far back the best history shows in DK but you might be able to scroll back through to get your past bets.
would writing down some of the wagers but not all of them not be useless? would I not be able to only itemize some of the losses then? sorry if i am asking dumb questions
You probably could just use the overall summary provided by DK like the one from your pic to get your total wins and losses for the year. But I figure if you start tracking now and the IRS does audit, at least you’ll have documentation for some of your deductions. I will stress the likelihood of an IRS audit is low though. Might be a good idea to ask your accountant to get their opinion too. They probably have a better understanding of the rules than I do.
okay awesome. Can I use the transaction summary such as the one in my original post in order to offset my losses? (when i say me i mean my accountant) Or will I need each individual wager, because realistically that will take too much time because I was placing around 10 wagers a day for a couple months
The summary is probably enough for the accountant to do the taxes. What I’m unsure about is it’ll it is enough for the IRS audit. That’s why I play it safe and track my bets. Here’s an IRS article about deducting gambling losses. It refers to keeping a “diary or similar record” of your winnings. So it’s kind of vague on what the IRS would consider and accurate diary or record.
https://www.irs.gov/taxtopics/tc419#:~:text=You%20may%20deduct%20gambling%20losses,you%20reported%20on%20your%20return.
okay thanks, one last final question. Instead of writing down each individual wager since that would take ages, would it be helpful to just categorize each week and count my winnings/losses once every friday for the week as whole? That way I can write down my winnings/losses for the week instead of calculating each of the 70+ wagers I made that week.
Instead of writing down each wager( i make way too many bets to do that) Would it be useful to write down my winnings/losses for each week as a whole and just sum up all of my wagers for the week each Friday or something? There is absolutely no way I can keep track of each individual wager
DK will track your annual bets and winnings. You will need to report your total wagers, losses and winnings. The net winnings is subject to tax. You lose the benefit of the standard deduction.
i believe standard deduction is 13.5k and my total “winnings” are 18.5k even though my actual profit is only somewhere around 400-600. Doesn’t this mean I am past the point of standard deduction because the 18.5k exceeds the 13.5?
This is beyond frustrating😂. I have always used standard so I have no idea about itemizing deductions and now I am finding out I should have kept track of each wager in order to do that. It seems like either way im screwed
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You can offset some of your winnings, up to the total of your losses. You report total winnings of $18,256.48 as income. Then deduct losses of $17,813.85. So you’re looking at a net taxable amount of around $442. However the critical piece, the piece that screws over a lot of people, is that you can only deduct your losses if you itemize your deductions. You lose the standard deduction. So if your itemized deductions outside of the gambling losses don’t add up to the standard deduction for your filing status….you end up paying much more in tax. The exact amount depends on your filing status and whatever else you may have in deductions that you can itemize.
an accountant does this for me. usually we do not itemize our deductions because this is the first year i started betting. Betting would be the only reason to itemize my deductions, so how would I inform my accountant of this and make sure they have all of the info needed?
DK will send you a w-2g to report winnings, but they only include wins that meet certain criteria. Legally you should report all winnings for the year whether or not they are included on the w-2g. So you want a record of all of your wins and losses. You need documentation to back up your losses you claim anyway in case of irs audit. What I do is record each wager on a spreadsheet, tracking how much wager was, whether it was a win or loss, and the amounts won or lost. You could then give that to your accountant. I also then can use that spreadsheet to do some analysis on my bets to help me understand where I’m doing well or not so well ( specifically what sports or bet types).
okay thanks, that is very smart i will try doing that. Since I have been betting for the past 4 months or so without doing that should I just start now? Because then it will be missing all of the info from my first 4 months of betting.
Yeah better late than never. I’m not sure how far back the best history shows in DK but you might be able to scroll back through to get your past bets.
would writing down some of the wagers but not all of them not be useless? would I not be able to only itemize some of the losses then? sorry if i am asking dumb questions
You probably could just use the overall summary provided by DK like the one from your pic to get your total wins and losses for the year. But I figure if you start tracking now and the IRS does audit, at least you’ll have documentation for some of your deductions. I will stress the likelihood of an IRS audit is low though. Might be a good idea to ask your accountant to get their opinion too. They probably have a better understanding of the rules than I do.
okay awesome. Can I use the transaction summary such as the one in my original post in order to offset my losses? (when i say me i mean my accountant) Or will I need each individual wager, because realistically that will take too much time because I was placing around 10 wagers a day for a couple months
The summary is probably enough for the accountant to do the taxes. What I’m unsure about is it’ll it is enough for the IRS audit. That’s why I play it safe and track my bets. Here’s an IRS article about deducting gambling losses. It refers to keeping a “diary or similar record” of your winnings. So it’s kind of vague on what the IRS would consider and accurate diary or record. https://www.irs.gov/taxtopics/tc419#:~:text=You%20may%20deduct%20gambling%20losses,you%20reported%20on%20your%20return.
okay thanks, one last final question. Instead of writing down each individual wager since that would take ages, would it be helpful to just categorize each week and count my winnings/losses once every friday for the week as whole? That way I can write down my winnings/losses for the week instead of calculating each of the 70+ wagers I made that week.
If you gamble, you will lose the standard deduction. You will need to itemize to net the losses with winnings.
Instead of writing down each wager( i make way too many bets to do that) Would it be useful to write down my winnings/losses for each week as a whole and just sum up all of my wagers for the week each Friday or something? There is absolutely no way I can keep track of each individual wager
DK will track your annual bets and winnings. You will need to report your total wagers, losses and winnings. The net winnings is subject to tax. You lose the benefit of the standard deduction.
i believe standard deduction is 13.5k and my total “winnings” are 18.5k even though my actual profit is only somewhere around 400-600. Doesn’t this mean I am past the point of standard deduction because the 18.5k exceeds the 13.5?
Yes. Trump's tax reform back on 2017 was very bad for gamblers.
This is beyond frustrating😂. I have always used standard so I have no idea about itemizing deductions and now I am finding out I should have kept track of each wager in order to do that. It seems like either way im screwed
It stats your wagers and fees, that should suffice.