WICHITA, Kan. (KSNW) — While the Kansas City Chiefs took home the Lombardi Trophy, some fans who bet on Kansas City are walking home pockets full of cash.
Whether you win at a casino or a bookmaker, local tax experts advise people to report all earnings on your 1040 tax form.
“If you win, it’s taxable income. Whether you win a dollar on a lottery scratch card or you win $10,000 on a sports bet, it’s all taxable income. Everything should be included in your 1040,” said Liberty Tax chief executive Shane Albrecht.
Albrecht says casinos and sports betting apps will automatically generate a W2-G form if earnings exceed $1,200. He says that if a form is not generated, all entries should still be reported.
“I think a lot of people just think they get away with it… I mean, you should report it,” Albrecht added, “And then if they get the W2-G and they don’t report it, eventually you’ll get a letter from the IRS, and they won’t. they want to see her.
Albrecht also explained that if you win at a casino outside of Kansas, a tax form for that state should be filed.
He said there is the potential to write off gambling losses, but only up to the amount of money earned. All winnings will be taxed at a rate which depends on the individual’s total income.