1040X W2G Win/Loss

Forum|Forum|1 year ago
September 14, 2024
2 replies
22 views

Taxpayer filed 2021 taxes with 166,764 w2g income and 25,678 in losses owing $33,000.

Taxpayer wants to amend their 2021 taxes and write off everything that they won because they lost everything, and they are a "compulsive gambling addict" and stated they "put back in what they won."

The reason $25,678 was written off was because they provided one win loss statement and not all of them as "some casinos won't give them to them"

Should this return get amended if they can't prove the losses to the tax return preparer or does one amend it anyway and they will have to prove it to the IRS, and I am supposed to take their word....

ProSeries Professional

This topic has been closed for replies.

T

Terry53029

Intuit Community Champion

To take loses off winnings a TP has to keep a log of winnings and losses. See link.

https://www.irs.gov/taxtopics/tc419

MGC94Author

Level 7

@Terry53029 Lets say the re create the log for IRS purposes is it okay to amend the return? I am under the impression that they do not have to prove it to me per say (that I take their word for it) but would have to prove it if they were audited to the IRS.

sjrcpa

Level 15

You can take their word for it if you believe it.

But amending a return to add $140K Gambling Losses might trigger a flag in the IRS' computer.

The more I know the more I don’t know.

PATAX

Level 12

In my opinion, Such a very large amount of gambling losses like that on a regular return would significantly increase the chance of an audit. Now if you put that on an amended return, which may be scrutinized, then I would say there's even a greater chance of an audit. Years ago a tax professional told me one of her clients were audited for gambling losses and they wanted to see all of the receipts/tickets/documentation. And the amount of gambling losses was far less than the amount in your situation. But that is my opinion, and you do what you want to do.

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