Gambling losses can be deductible, but you must follow key steps. Here’s how:
- Keep Detailed Records: Maintain a gambling log with dates, locations, amounts won/lost, and types of wagers.
- Gather Supporting Documents: Collect tickets, receipts, bank statements, and Form W-2G (if applicable).
- Itemize Deductions: Use Schedule A on your tax return to itemize your losses up to the amount of your winnings.
- Report Winnings: Ensure all winnings are reported as income.
- Consult a Tax Professional: Seek advice to avoid errors and maximize deductions.