Gambling winnings and losses
A W-2G for gambling winnings, and the hard truth about losses: they only help if you itemize. A common surprise every filing season.
The taxpayer's facts and source documents are free with an account. No card, nothing to cancel.
Taxpayer facts
Who this is and what their year looked like.
Tony is single, 45, and works a regular W-2 job in Las Vegas. He plays cards and slots casually and had a good run this year, getting a W-2G for his winnings.
He kept a log of his losses too. He has no mortgage and no other big deductions, so he is deciding between the standard deduction and itemizing.
Source documents
The 2 documents you will prepare the return from: W-2 (Wage and Tax Statement), W-2G (Certain Gambling Winnings).
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Create a free account to open the taxpayer's facts and every source document. No card, nothing to cancel.
Objectives
What a correct return should capture.
- Report the W-2 wages.
- Report the gambling winnings from the W-2G as other income on Schedule 1. Winnings are taxable even if no tax was withheld.
- Understand that gambling losses are deductible ONLY as an itemized deduction on Schedule A, and only up to the amount of winnings. Compare the documented losses to the winnings.
- Compare itemizing to the 2025 single standard deduction ($15,750) and take the larger, then see what that means for the benefit of the losses.
- Apply the larger deduction and compute the tax.
- Reconcile withholding to the refund or balance due.
- Note that Nevada has no state income tax.
Check your work
The answer key and the complete return, the way a real client receives it: the 1040 and its schedules, the workpapers behind every number, and the signature forms.
Stuck? Work through it with Yehuda
A one-on-one, 30-minute tutoring session on this return with Yehuda Tenenbaum, EA. Bring the spot where you got stuck and we will work through it together: how the forms connect, why a figure lands where it does, and how to check your work. $250. This is education on the practice return, not advice on your own taxes.