Trip (prize) vs Gambling winnings

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  • AZ-Tax
    Senior Member
    • Feb 2008
    • 2604

    #1

    Trip (prize) vs Gambling winnings

    Client won a trip to Disneyland thru a radio contest. The contest people (what ever they are called) put a value on the trip of $1256 in the form of a 1099-misc (box 3). Client has $1416 of lottery tickets and casino losses for which I would require my Client sign a letter to that effect.

    Am I safe to enter $1256 as "Gambling winnings" on line 21 form 1040 and enter the $1416 as Gambling losses in Sch A form 1040?
  • Jiggers
    Senior Member
    • Sep 2005
    • 1973

    #2
    Prize versus Gambling

    Mixing apples and oranges.

    You can't deduct gambling winnings against a prize.

    Even if you could, the gambling expense is limited to the gambling income and subject to 2% AGI.
    Jiggers, EA

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    • AZ-Tax
      Senior Member
      • Feb 2008
      • 2604

      #3
      Correction: Trip (prize) vs. Gambling losses

      Sorry, about that. Prior heading was different then content.

      Comment

      • Larmil
        Senior Member
        • Dec 2006
        • 621

        #4
        Originally posted by AZ-Tax
        Client won a trip to Disneyland thru a radio contest. The contest people (what ever they are called) put a value on the trip of $1256 in the form of a 1099-misc (box 3). Client has $1416 of lottery tickets and casino losses for which I would require my Client sign a letter to that effect.

        Am I safe to enter $1256 as "Gambling winnings" on line 21 form 1040 and enter the $1416 as Gambling losses in Sch A form 1040?
        No. The prize is not considered gambling winnings. Prize on line 21 and nothing on sched A unless there is gambling winnings.

        Comment

        • Y2KEA
          Senior Member
          • Nov 2005
          • 344

          #5
          Originally posted by Jiggers
          Mixing apples and oranges.

          You can't deduct gambling winnings against a prize.

          Even if you could, the gambling expense is limited to the gambling income and subject to 2% AGI.
          Gambling losses go on schedule A line 28 NOT subject to 2%AGI.

          Comment

          • Jiggers
            Senior Member
            • Sep 2005
            • 1973

            #6
            You are correct

            Originally posted by Y2KEA
            Gambling losses go on schedule A line 28 NOT subject to 2%AGI.
            Head in a fog this time of year. You are correct. But they are limited to winnings.
            Jiggers, EA

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