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This is not considered earned income, therefore you should not lose any social security benefits because of these winnings
However, a portion of your social security would be taxable - 85%
Your gambling winnings are placed on line 21 of your tax return
Your losses are deducted on Schedule A
so, in the end you don't pay tax on the $300,000 but you will have to pay tax on 85% of your social security benefits
I already lost half of my social security benefits in the last two years because of gambling wins. Although I took my loss tax deduction it was added to my adjusted gross income. Only the deduction was taken on the itemized deduction page. line 28 miscellaneous
Yes, that's correct
it is added to your adjusted gross income - so 85% of your benefits would be taxable
The loss is deducted as an itemized deduction - which occurs after your agi is calculated
So it is still considered part of my adjusted gross income eventhough my losses equaled my wins. The casino is telling me I have been doing it incorrectly these past few years. Im confused
Your accountant is correct
You can only deduct gambling losses as an itemized deduction
It is still part of your adjusted gross income
Ok that's what I thought.....You are certain?
I just sent you a link to the IRS page that explains this
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No it just doesn't seem fair....that my losses equal my wins and I am penalized by adding it to my earned income
I'm truly sorry, but unfortunately that's how the IRS has it set up, where your winnings are added to your AGI and your losses are deducted as itemized deductions
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