It’s all fun and games – as long as you watch out for taxes. Gambling winnings refer to the amount of money you get from the lottery, horse race, casinos and other means of entertainment in the same category.
The IRS expects you to report gambling proceeds on line 21 (other income) of your 1040.
Also, note that the state you living may also have its share of earnings from gambling, especially for the lottery. Maryland and Arizona, for instance, withhold taxes on lottery winnings from non-residents and Pennsylvania also wants some of your money for winning in their state.
Here is how much you have to win to be subject to IRS taxes:
- $1,200 or more from bingo or slot machines
- $1,500 or more from keno
- $5,000 or more from a poker tournament
- $600 or more at a horse track