Quote:
Originally Posted by Spiderman
There is an extreme disadvantage for horse players who do not file Schedule A. In 2008, I hit $3,000 with two 'signers'. IRS requires that you file losses, up to winnings on line 28, Schedule A. Problem is that this disqualifies use of standard deduction of $5,450. Also, I do not have sufficient deductions to equal standard deductions.
Winning is losing! Unless, you win very big. By winning 'signers' for less than the standard deduction, you lose. You may also lose more if the standard deduction would have alleviated your tax reporting.
I know that this method of filing losses v. winnings was not always the case. When was this put into effect? The racing industry will lose a considerable amount of handle if more people decide to stop betting because winning will cost them more when filing taxes.
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You don't have to file Schedule A. You can go ahead and take the standard deduction. If you do that the IRS assumes your losses are part of the standard deduction which, in your case, seems to be correct.
I would bet that absolutely every US taxpayer is treated unfairly by some aspect of the US tax code. We just have to live with it. I don't see how any government in the world can fund its operations other than through confiscating the property of its citizenry on a regular basis.