Wednesday, June 14, 2006

Gambling winnings are wholly taxable and must be reported on Form 1040, Line 21 if you are not a professional gambler. It is significant to keep an accurate diary or similar record of your gambling winnings and gambling losses. If you itemize your tax deductions on Form 1040, Schedule A, you may subtract any gambling losses up to the amount of your gambling winnings on your tax return. If you have no gambling winnings for the tax year then you cannot remove your gambling losses on your tax return. The tax subtraction on your tax return is not subject to the 2% AGI floor. You cannot deduct your gambling losses directly from the winnings reported on your Maryland tax return. However, your losses may meet the criteria as a deduction if you itemize deductions on your federal and state returns. Read further...