Question about tax on casino winnings.?

Sorry you've received some incorrect or conflicting answers. Here's the relevant info you need - with links to the IRS so you can verify my statements.

Please note that I when I say "casino" I am talking about the institution that you placed those bets with. The answer is the same whether you went to Caesars Palace in Vegas, a local bingo hall, made bets online roulette, bet on sports games, or any other method.

1. Yes, you will get a tax form, specifically a W-2G, where the letter G indicates that the income is from gambling. But the name of the form isn't really important. What is important is the fact that the casino is going to send copies to both you and the IRS, so you cannot just ignore the income and hope that the IRS doesn't find out. You will need to file a tax return and report this income and pay any tax you might owe.

2. If you were doing a lot of gambling the casino *might* include smaller winnings as well. For example if you were playing roulette and won a bunch of $5 bets on red/black and those 5 big ones were times that you hit on specific numbers, then the casino may have tracked ALL of your activity and would include all those little $5 wins on the tax statements. So its possible that your W2G form will actually show a lot more than $3600 in total prizes won.

3. At first glance it appears you will owe $250 in federal income tax. You may also owe some income tax to your state depending where you live. Here's how I computed that: You won $3600 total (assuming point #2 above does not apply), you will get a standard deduction of $1100 which brings the taxable portion down to $2500. The tax rate at that income level is 10%, so you will owe 10% of $2500, which is $250 tax owed. State tax is likely 0-5% on that $2500 so anywhere from $0 to $125 owed to your state (most likely on the lower side of that range). You could owe more if the casino includes all your small wins as well.

4. HOWEVER - you could also itemize your deductions instead of taking the flat $1100 standard deduction. If you made lots of bets and had more than $1100 in losing bets then this would be to your advantage. If you lost all of the money back to the casino you'd end up with a deduction that matches your winnings resulting in $0 taxable and therefore $0 tax owed.  The bottom line is that if you use this method (and assuming you have an accurate record of all wins & losses) you will only pay tax on the net winnings.

5. You said you "happened to get some money helping someone out" - if you worked for someone and they paid you for your work then that income *technically* needs to be included on your tax return. But in reality if this was a side job where you helped someone and they slipped you some cash there's no realistic way the IRS is going to find out about it so its up to you whether you want to ignore this or report it to keep everything on the straight & narrow.

6. The good news though is that your winnings will NOT affect your father's ability to claim you as dependent and get the relevant tax benefits. Since you are disabled there is no age limit on the "qualifying child" dependency rules. Under this set of rules there is no income limit - You can *theoretically* earn any amount of money as long as you can prove that you aren't providing at least half of your own financial support. There is no way that $3600 worth of prizes from gambling is more than half of your support when your Dad provides housing, food, clothes, medical coverage, and everything else.

So you will still qualify as dependent under your Dad using the "qualifying Child" rules. He will list you as dependent and get all relevant tax benefits which may include head of household filing status, the $500 tax credit for adult dependents, Earned Income Credit (if his income is below the limits), and the child/dependent care credit (if he pays someone to care for you while he works - your disability exempts you from the age limit here as well).You will need to file a separate tax return to report your income, claim the deductions, and pay any tax you owe. You need to make sure you mark on your return that someone else can claim you as dependent. Your income does NOT go on your Dad's tax return.I'm providing a few relevant links to the IRS website in the source box below so you can verify my answer.

Hope this helped.

Gambling casinos report winners, so the IRS will be aware of you. If there is a tax issue, better to face it than to hide from it.

Yeah, it will be a problem. You have to pay taxes, and have to file the forms you receive from the casino. You aren't exempt from taxes on gambling winnings. And alternatively, you may be able to deduct gambling losses.

There absolutely will be a problem if you don't file and pay your taxes. You owe approximately $260.

Your father can still claim you. As a disabled, unmarried offspring who lives with him, you would have to pay half of your own bills to not be considered a dependent.

You will not get a W2. That's for earned wages. You will get a W2G. Gambling winnings are subject to a flat tax of 24%.  That's $864.  Your father will not have to claim your winnings as income--he cannot claim income, earned or unearned, that is not his alone. But YOU have to file a tax form on the winnings if you won more than $1050, which you did. So yes, you will have to file a tax return and claim your winnings as Unearned income, and indicate on the form that you are a dependent on someone else's tax return. You will also NOT be allowed to take the personal exemption. 


Yes, it will be a problem because if you do get that W2G form your winnings have been reported to the IRS--if you don't file it would be tax evasion. You might have to pay a lot more than that $864 if they catch you and demand payment--there will be late charges and penalties for not filing. 
check the information available on the IRS website. 

No. You owe taxes on it. Or he may.  For large amounts in the US they take the taxes off the top. Like 20-28% or something.

I do not pay tax on casino winnings in Canada. Here's a proof https://www.casino.ca/guides/taxation/. And if I quench my work and risk it, then I choose the peaceful option in high-class online casinos. For example source 2

In general, the best choice is online games, at the present time with this coronavirus it is better to sit at home and get vaccinated on time.

This would not cause your father to lose you as a dependent and your taxes would be minimal.

W2- G certain gambling winnings ... plus related infor in irs.gov [Gambling winnings are taxable (i e put on the 1040) income]

Tax on what you won and probably put back in the slot machines is going to be zero.

You would get a 1099, not a W2.