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Why is a $700 win counted as a $1,400 win for tax purposes?

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  • Why is a $700 win counted as a $1,400 win for tax purposes?

    We received the following question:

    I was recently playing Interlock Roulette where the wheel spins the ball is dropped and lands on a number. I deposited $1000.00 into the machine. My bet was $700.00 on a color and I won $700.00 on a color. I now have $1700.00 in the machine but only a $700.00 win. The machine locked up as if I won $1700.00. Am I taxed on $1700.00?


    And here is our answer:

    You will get a W2G tax form for any win of $1,200 or more whenever you play an electronic gaming machine. Even though you bet $700 and only won $700, the system doesn't deduct your original bet. It only accounts for how much money is being paid out. So, unfortunately, you will need to count that entire $1,400 as a win on your taxes, even though you only won $700. It's really not a fair system because most people will get lucky on occasion and win a taxable jackpot, only to lose it back later, and then they will have to pay taxes on that first jackpot which they later lost back. Therefore, just like you, they will be paying taxes on money that they never actually won. When you file your taxes, you can deduct your gambling losses, up to the amount of your gambling wins. However, you can only do this if you itemize your deductions. If you take a standard deduction you can't deduct your gambling losses. You will have to pay taxes on all W2G forms even though you may have lost it all back. If you do itemize be sure to try and keep a gambling journal to track your losses and wins to show any net loss that you have for the year that would cover all of your gambling wins.

  • #2
    A $700 win is counted as a $1,400 win for tax purposes because the IRS requires you to report the gross amount won before any deductions. If you're looking for more thrilling opportunities to win big, check out West Casino https://westcasino.co/ for a wide variety of games and exciting promotions.

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