One More Tax Question

[RoundGuy]

Haven't seen this one asked.

My wife and I file taxes jointly, and both play poker. She loses more than she wins. I win more than I lose. Can I apply her excess losses against my wins on a joint return?

IOW, can we combine our sessions since we're filing jointly.

[JiffyPop100]

Im no CPA, but I would think that if youre filing jointly, you can combine it all.

but how much did you lose?

[Tmoney120]

What you do is take your net winnings - her net losses and pay taxes on that amount. Just make sure you keep good records in case you ever get audited.

[Lottery Larry]

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What you do is take your net winnings - her net losses and pay taxes on that amount. Just make sure you keep good records in case you ever get audited.

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Again, you report your COMBINED gross winnings in miscellaneous income and your COMBINED losses in deductions where indicated for gambling. Do NOT combing wins and losses and report a net win amount (or breakeven 0) only!

RoundGuy- note that, if you have state lottery gambling to report, especially from more than one state, you need to look carefully at what you report.

My state doesn't allow lottery losses from other states to be deducted (unless that's a Turbo Tax glitch; I'm going to a tax pro this year to handle several things, and to check on TT results in areas such as these)

[dnord]

Mkay, Tm's definitely wrong. No answer that includes netting will get credit. I am also not a tax expert but I plan on paying taxes this year, so I've at least done that much research. [img]/images/graemlins/smile.gif[/img]

If you weren't filing jointly, your winnings (the total of all winning sessions) would go on the front, and your losses (the total of all losing sessions) would go in deductions.

If I understand correctly, she'd be able to deduct losses equal to her winnings, but nothing more than that.

Filing jointly, the real question is, can she deduct more than she won just because there are other gambling winnings in the family? I think that would be a reasonable assumption, since the government actually sees married filers as a "single unit" (and allows her student loan deduction, for example, to be applied to your combined gross income, whether or not she would have qualified for it by herself).

But again, the only valid advice is "go talk to someone who isn't guessing about what the government would find reasonable, permissible, or forgivable". And let us know what you find out.

[Lottery Larry]

"Filing jointly, the real question is, can she deduct more than she won just because there are other gambling winnings in the family?"

Actually, I think that as a M-FI, your individual misc. income and deductions must come to 0 at the lowest. That's why you file jointly, to combine the family's income/deductions.

But as you said, consult a tax pro and not us 2+2 wannabes.... or ask the IRS- they're the ones who will be judging the results, right?

[broiler]

Gambling gains and losses of a husband and wife are pooled if they file a joint return so that losses of one are deductible against gains of the other. Source: Treasury Reg. 1.165-10

This was cut and pasted from my tax research software, so I apologize if the formatting comes out bad since I removed links into my account.

[Lottery Larry]

Yes, filing jointly, you report combined wins and deduct combined losses, down to a minimum of $0 gambling income.