Most people receiving Form W-2G know their gambling winnings must be reported as taxable income. Even if a W-2G is not received, the law requires all gambling winnings to be reported. The IRS explains that gambling income includes not only winnings from lotteries, raffles, horse races, and casinos, but that it also includes cash winnings and the fair market value of prizes, such as cars and trips. Winnings are reported on the first page of Form 1040, and are not allowed to be directly offset by gambling losses.
As we've said before, one of the most common questions we get is about how to deduct the business use of your vehicle. This type of deduction is fully allowed, and as CPAs we encourage you to deduct the business portion of your vehicle expenses.
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