As an accountant, you know any additional income means a potential tax liability for your clients. For clients who gamble, winnings can lead to unexpectedly high tax bills. Keep the house from taking your clients' hard-won gains.
In Episode 49 of my Earmark Podcast, I interviewed gambling tax expert Zak Zimbile, CPA, on strategies to minimize taxes on gambling income. Zak shared insider tips from over a decade of experience advising gamblers nationwide.
A key takeaway: carefully tracking gambling activity is crucial for reducing clients' tax burden. As Zak explains:
Most states follow the federal guidelines, so they'll allow you to take gross winnings and deduct them against itemized deductions. But other states don't allow deductions for losses at all. So whatever the gross winnings, tax is owed on that amount.
By tracking each gambling session, you can help clients accurately offset wins with losses to lower net taxable income in the states that allow this treatment. This helps avoid paying tax on gross winnings exceeding actual profits.
Want to build your expertise in gambling taxation? Listen to the episode to master strategies to minimize clients' tax bills. With the right advice, you can help clients beat the house and keep more of their hard-earned winnings.
