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Oling gambling and 1099 reporting

thequietman
Contributor

Oling gambling and 1099 reporting

I was a fool last year and spent a lot of money on online gambling. I am dealing with my addiction demons and have left that life behind, but I am now dealing with the debris of those bad choices at tax time. I lost $60,00 last year, but I am alive and moving forward in recovery. I have the W2g forms from my casino showing the gains I had, and, most importantly, the list of wagers demonstrating the losses, so that is a wash. The problem lies with having used Paypal as the intermediator source for the money transfer. I was issued a 1099K form that said I made way more than my dreams. While gambling,  I would transfer my winnings back into my bank through Paypal and then back out again into the casino, instead of letting it sit in Paypal where I was afraid, I would spend it all..  Unfortunately since Paypal only shows the winning on the 1099 and not the losses, it gave me a 1099 of stating that I made over $240,000, when I actually lost $60,000. Has anyone had a similar issue, although I hope on a smaller scale. I do not know how I can reconcile this on my taxes and demonstrate the loss. Any suggestions, I am just devastated.

2 REPLIES 2
MoonSoon
New Community Member

Re: Oling gambling and 1099 reporting

I have the same problem. Did you ever find a solution for this? I contacted PayPal and they said they couldn't do anything about it. Not sure what to do! 😞

jren9718
Contributor

Re: Oling gambling and 1099 reporting

I also use paypal for online casino in NJ. I didn't know this rule at all. Did Paypal report all your winnings?