Page 9 - Southern California Gaming Guide • February 2021

by Alex Winters
This year saw a lot of changes in and out of the casino, but one thing always stays the same: the IRS wants their cut. As I’m sure you know, all jackpots over $1199 are taxable by the IRS. So, would you like to keep more of your winnings by following some basic steps?
Use an Excel spreadsheet for your gambling log, or keep a log on your phone or in a dedicated notebook. There are several apps for mobile devices that are helpful, especially since most of us have a phone with us 24/7. There are many, so experiment to find one that suits you. It doesn’t matter which method you use for your gambling log, as long as you keep an accurate and detailed one.
Win/Loss Statements
Casino win/loss statements are essential tools for tax preparation. Win/loss statements issued by a casino are close estimates of what a casino guest has won and lost during a calendar year based on players club tracking information. Unless you have signed up for a casino players club, there is no way to accurately track your wins and losses in a casino. Therefore, it’s important to sign up for a players club card at every casino you play. Get your win/loss statement from every casino in which you played before filing your taxes.
Be a Better Bettor
I’ve always tried to learn from my play, so I’ve added other columns to my log: one for the amount of money (bankroll) I gambled during each visit, and the other for the amount I left the casino with. These two columns are only for my information. I added them as I know that sometimes I won jackpots and ended playing them all or partially back. I’ve also added a section for notes where I comment on my play, how I felt, was it fun, etc.
While keeping a log is a must for tax relief, it’s also a great learning tool for managing your bankroll and how you gamble. With this info you can improve your play and hopefully become a more consistent and satisfied winner: a better bettor.
Combine your gambling log for 2020 along with your casino win/loss statement, and you have assets that can enable you to keep as much of your
winnings as possible.
Alex Winters lives in Las Vegas and is an avid sports fan & gambler.
Note: Every year brings a slew of important changes to tax returns so please consult a licensed professional tax service or Certified Public Accountant (CPA) when filing your taxes. To be clear, I’m not a CPA, but I did play one on TV. With that being said, 2020 tax returns are due Thursday, April 15, 2021. Casino winnings could affect your tax bracket, so always do your due diligence to keep informed. You can learn more at IRS.gov.
Keeping more of your casino winnings will require two crucial components. First, keep an annual gambling log. Second, play with a player’s club card and get your win/loss statements from casinos you’ve played in 2020. If you’re not familiar with how casinos report your winnings, read on.
The Good and the Bad of the W-2G
The IRS requires casinos to report all player jackpots and wins over $1199 via a w-2g form. The wins can come from slot machines or any other casino game. The w-2g lists your name, address, Social Security Number, and other information regarding your win. It’s mandatory that casinos give players a copy of the w-2g with their winnings clearly stated. Another taxable form of winnings can come from casino promotion prizes. Prizes are taxed at the value awarded. Be certain to request
The Essential Gambling Log
I keep all the w-2gs I receive from casinos in one place, along with all atm receipts, or other receipts showing the funds I used to play at the casino. I then note in my gambling log the wins and losses along with the date, time and casino I played in. As long as I keep track in my gambling log and have all my win/loss statements, I’ll be able to deduct my losses from my winnings. Hence I will not have to pay as much in taxes. But remember, you can only deduct gambling losses if you itemize the deductions.
If you ever find yourself audited by the IRS you’ll be glad to have the basic records showing when, where, and how much you won and lost. It’s very important your logbook is as accurate as possible to be viable.
To help with your log’s accuracy, be certain to include the following: Casino name and address of where you played, date and timeframe you played, type of game you played, amount(s) you won and/or lost for each session or game, proof of your winnings or losses (w-2gs, atm receipts, etc.), and the amount of money you started with and ended with.
I set up my log each year with eight column headers: Casino, Casino Address, Date Played, Time Played, Game Played, Winnings, Losses, and Type of Proof (receipts, screen shots, etc.). To keep accurate records, always update your logbook after each and every gaming session.
documentation on any prize winnings. casinos send those in the mail.
When filing income taxes, you are required to list all prize and gambling jackpot winnings $1199 and over. If you signed a w-2g, those winnings from the
w-2g need to be filed. Gambling and prize winnings are taxable income. You heard the bad, now for the good: the IRS allows deductions of your losses up to the amount of your winnings — but only if you have documentation of your losses. Therefore, keeping an accurate gambling log and obtaining win/loss statements from all the casinos you’ve played in is the best and only accepted proof of what you won and lost.
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FEBRUARY 2021
SOUTHERN CALIFORNIA GAMING GUIDE
PAGE 9