In this episode, Dan & Ian are giving you a simple explanation of how to report your gambling activities for your 2021 tax return. 

COMPLIANCE STATEMENT: Any income is taxable, not just money that is reported on your W-2G. All income is taxable unless exempt by Congress, even if you make $1. This video is strictly for entertainment purposes. This is not financial advice or recommendations.

Step 1: Receive Your W-2G statement 
----Generally, you'll receive an IRS Form W-2G if your gambling winnings are at least $600 and the payout is at least 300 times the amount of your wager. If not, it is up to the individual to self-report their winnings and loses.

Step 2: How to Report Them (Federal)
-----Gambling losses are allowed to be deducted up to the amount won. There is no deduction received even if your losses far outpace your winnings (you cannot receive the additional deduction or carry forward that amount to subsequent years)
----You may deduct gambling losses only if you itemize your deductions
----You can only take this deduction if you keep detailed records based on your gambling sessions.      ----Gambling is a high priority during personal audits. (i.e receipts, tickets, statements, or other records that have winnings and losses)
----Claim your gambling losses up to the amount of winnings as Other Itemized Deductions

Step 3: How to Report Them (State)
----IMPORTANT PA NOTE: Gambling winnings are fully taxable by the Commonwealth of Pennsylvania. State residents must pay state income tax on all gambling and lottery winnings from any source, except for non-cash prizes from playing the Pennsylvania State Lottery. As a resident, you must include lottery winnings from other states and countries.
----No, expenses attributable to gambling and lottery income are deductible, such as: parking, postage, entry fees, meals and lodging or travel.
----You can offset your winnings with losses up to the amount of winnings in PA

Step 4: Find a CPA to Help You
https://www.troutjames.com

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Thank you for joining us on this episode. Please like, subscribe and write a review for the podcast if you enjoyed this. We will see you next WEDNESDAY!!!