While losses can be used to offset your big wins, you can only deduct losses up to the amount you reported as won.Ĭould the slot win threshold for generating a W2-G be increased? Since the standard deduction was recently increased significantly, fewer people itemize making it a challenge for some to avoid paying taxes on their win. Keep in mind, gambling wins can be offset on your federal taxes by losses incurred over the year, but only if you itemize your deductions. Since the generated W2-G detailing the win is sent to the IRS, players would be risking an audit if the income isn’t declared on that year’s tax return. Most are more concerned about wins large enough to trigger a mandatory W2-G.Ī W2-G is a federal tax form notating your income from gambling activity that the casino generates at certain win thresholds (discussed below) and is reported to the IRS.

Tax professionals often recommend keeping a log of gambling activity to include dates, games played, and profit/loss over the session so that you have a record of your activity over the year.Īlthough the IRS wants a cut of ANY gambling win (whether big enough to generate a tax form or not), most recreational gamblers don’t keep a detailed record of their wins/losses for tax purposes (tisk, tisk, tisk). There’s no special gambling income tax rate It’s simply treated as income, just like that earned at your day job.

Gambling wins are added to your income and taxes are paid at your marginal rate. If you profited, even $5, the IRS wants their cut. That goes for any type of gambling income you earn whether on the slots, table games, lottery tickets, horse racing, or a friendly bet with your neighbor Jim. When do you need to pay taxes on gambling wins? Seek professional help if you need real-world or situational advice.

Keep in mind, I’m a Vegas aficionado, not an accountant. My intent here is to give gamblers a high-level overview of how federal taxes work when it comes to slot jackpots in Vegas, and around the country. What most people fail to think about, however, are the tax implications caused by a big slot win. If you have an upcoming trip to Las Vegas, or any casino for that matter, chances are you’ve had dreams of hitting a big jackpot.Īfter all, what would be sweeter than funding your entire trip, or early retirement, with one lucky hit.

Huge slot wins