Well now hang on there. I was referring to paying federal taxes in general, not tax code as it applies to gambling wins/losses. Technically in this case Aunt Louise could report the losses to offset her win (but only if she got a W2G) <and> if she was able to benefit from itemizing her deductions. However most people do not, so in this case it would be entirely legal for her to not report anything when using the standard deduction. Especially since she would not have been issued W2Gs for the small wins anyway.Originally Posted by Don Perignom
In the context of a recreational gambler the tax code is not fair IMO because it puts an unreasonable burden of proof on the taxpayer to document any losses than might offset (or completely negate) the win. So most people will not bother and just pay excessive taxes. We've discussed this before and I've voiced my disapproval of how our tax code handles gaming income.
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