Win/loss statements are a common point of confusion for players. While we often hear about them during tax season, we get questions about them throughout the year. Here’s a recent example:
I bet 10k over time and it said I got 7k in withdrawals. The problem is my bets say 126k and I won 115k. What do I claim on taxes? I never received 115k?
Maria
The IRS says you need to claim all wins and all losses. But while you may have put 10k in the machine over time, you didn’t bet 10k, and that’s what coin-in measures.
Think about it like this: You put $100 in a slot machine. You play it for a while. You get bonuses, your balance goes up and down. Maybe at the end of it you cash out $50, but you didn’t just bet $50 – you probably bet a whole lot more than $50 because you keep playing with the same money. Your coin-in and coin-out reflects the entirety of your bets and winnings from those bets, and are not a reflection of what you took out of the machine.
So you didn’t put 126k in the machines and cash out 115k. Win/loss says that out of a total of 126k in total wagers, you were awarded 115k in payouts.
There is a discrepancy between your accounting and the win/loss statement as you have a loss of 3k and between your bets and wins on the document it shows 9k. So something’s not being accounted for somewhere, such as free play or some other aspect that led to additional losses.
It’s also important to remember that win/loss statements can be (and often are) missing data – if you forget to use your card, or the machine is broken, or you choose to pull your card out, not all your play is accounted for. This is why the IRS advises players to keep other records (ATM receipts, gambling logs and the like) to prove the wins and losses in various ways in case of an audit. Many players don’t do this at their own risk.
As far as taxes are concerned, many people also do this incorrectly, so we always recommend consulting an accountant who is well versed in gambling tax laws to ensure you file accurately. As always, we note that we are not accountants, so the above is not legal advice, but rather designed to be helpful information to point players in the right direction.
