Gambling Losses Tax Deductible?

[jonestavern]

DH's aunt--in her late 70's-- says her gambling losses are tax deductible, is that true?

This lady has 'lost' (thrown away) over $100,000. in 1 year.
That was not a typo--one hundred thousand dollars

She is now living with her only daughter & does not have the funds to keep up her health insurance, which I guess her DD will have to pay the premiums on.

so does anyone out there know if the gambling 'expenses' thing is true? or is it more complicated than what she's letting on?

Jean

 

[salmoneous]

There are two ways to deduct gambling losses. For "normal" people, you can put an itemized deduction for gambling losses up to the amount of gambling winnings you declared as income. But you get no deductions for losses in excess of what you declare as winnings.

The only way to get a deduction for losses in excess of winnings is to file as a professional gambler. Basically, you file a schedule C. Note that the IRS is *highly* suspicious of anyone filing as a professional gambler. Unless she has filed as a professional gambler and payed taxes on winnings the past few years, there is almost no way to file with losses the first time.

 

[jonestavern]

If she's filing as a 'professional' she's sure in the wrong profession!

Let me tell you, she's 'out there' far enough to give the whole deduction thing a try!

Jean

 

[chris1gill]

I can only say WOW just WOW!!!!

Hope they get the right answer.....

 

[AllyandJack]

If she itemizes and her out of pocket medical costs (including premiums for the insurance) are more than 7.5% of her income, she can deduct anything over that 7.5%. If it's enough, it might be worth it to itemize, but if itemizing is less than the standard deduction, it's probably not worth it to itemize. Any accountant (even Turbo Tax) should run those numbers and let you know which way is the best way to go.

 

[KristaTX]

If she itemizes and her out of pocket medical costs (including premiums for the insurance) are more than 7.5% of her income, she can deduct anything over that 7.5%. If it's enough, it might be worth it to itemize, but if itemizing is less than the standard deduction, it's probably not worth it to itemize. Any accountant (even Turbo Tax) should run those numbers and let you know which way is the best way to go.

What do gambling losses have to do with out of pocket medical costs ?

ETA: I'm not saying you are wrong, but that doesn't seem to make any sense to me as a taxpayer who does not waste my money by having gambling losses.

 

[jonestavern]

Actually, Eleanor's in great shape

She's in her mid-late 70's, smokes like a fiend & has a steady diet of chocolate & fried foods. I kid you not, her diet is a running family joke

She'll outlive us all, inherit our money & still be rolling the dice 6 years after we're dead & buried!

Jean