As those who occasionally visit the casinos or the racetrack know, the Internal Revenue Service requires that a winner must be given a form W-2G (Certain Gambling Winnings) at the time of each bet with proceeds of $1,200 or more. It surprises no one that the IRS wants to be sure the winnings are reported.
We’ll soon bring you a more complete discussion on documenting your gambling losses, and also explain how losses are treated, but here we want to alert you as to the importance of getting us each and every one of the forms W-2G you receive during the year.
This form is unusual because it isn’t sent to you after the end of the year as most reporting forms are (salary W-2s, 1099s for interest, non-employee compensation, etc.). This makes it easy to misplace them and not have them ready at tax time. We know you would never do this, but it happens.
There is an IRS rule that we cannot e-file your income tax return prior to the receipt of all Forms W-2G. If we do, we, your beloved accounting firm, can be subject to IRS sanctions.
So, please be sure you have all of your forms; if you’re uncertain you have them all, most casinos will run you a report of the forms they have given you during a year.