Are Bingo Winnings Taxable ?

Many bingo players do not think bingo winnings are taxable. Many people think “if I don’t tell them they’ll never find out.” That could be a big mistake and the IRS is relentless in pursuing tax cheats. The bottom line is that players must pay taxes on all of their winnings. Some think that because most bingo jackpots are relatively small they are not taxable. Unfortunately there is no low-threshold limit on taxable winnings.  Many players leave a paper trail that is easily picked up by IRS agents and the agency will want its share of the gambling profits.

Players in land based bingo halls and casinos must use IRS form W-2G to report jackpots and bingo winnings over $1,000. Casino players that stick to table games are usually not required to fill out an IRS form W-2G to report any winnings. Players that win a bingo  tournament where the payoff is 300 times the entry fee must fill out a W-2G. In casinos when players have cash transactions that reach $10,000 or more the casino is required to fill out a currency transaction report. The floor worker will ask for identification and a social security number. If players refuse to provide this information the casino must file a treasury report regarding suspicious activity.

A wise man once said ‘never mess around with an agency that is in a position to make your life miserable. The IRS is one such agency. Players that win large jackpots should save every piece of paper with the amount on it. They should also get a report from the casino in writing. These can include bingo and keno tickets, sportsbook tickets and tournament-entry tickets. Be sure to save ATM and credit card receipts, cancelled checks and bank statements. IRS Publication 529 advises “You must keep an accurate diary or similar record of your losses and winnings.” The diary should contain the date and time of the game or wager, the name and location of the gambling establishment, the names of persons with the gambler when the wagers were made and the amount won or lost.

Online bingo players from the United States face challenges when they win at online bingo sites and casinos. While online bingo and gambling are not illegal processing any transactions related to online bingo and gambling is illegal under federal laws. Unfortunately at the present time there are no IRS publications that deal with this issue. Players should remember that ALL gambling income is taxable.

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