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Arthur Rubin
Arthur Rubin, Tax Preparer
Category: Tax
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Experience:  22 years of tax preparation experience, including individual, trust, and estate returns.
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As a general rule are gambling winnings (say I winn 1 mil in

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As a general rule are gambling winnings (say I winn 1 mil in Vegas playing poker) taxed as ordinary income? Thanks -John
Submitted: 7 years ago.
Category: Tax
Expert:  Arthur Rubin replied 7 years ago.
Dear "pilates",

Yes, exactly. Gambling winnings are included in the miscellaneous income line of your 1040, so are taxed as ordinary income. Losses (up to the amount of winnings) can be deducted as itemized deductions on Schedule A line 28, and are not subject to the 2% limitation or to AMT.
Customer: replied 7 years ago.
Can you point me to the section of the tax code that indicates the above
Customer: replied 7 years ago.
Where in the irs code does it indicate that gambling winnings are to be reported under misc income on the 1040
Expert:  Arthur Rubin replied 7 years ago.
I can't find it specifically in the tax code, but IRS publication 17 specifies, in Chapter 12, page 92

You must include your gambling winnings in income on Form 1040, line 21. If you itemize your deductions on Schedule A (Form 1040), you can deduct gambling losses you had during the year, but only up to the amount of your winnings.

Edited by Arthur Rubin on 5/3/2010 at 6:47 AM EST
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