See IRS Memorandum from 2008 - https://www.irs.gov/pub/irs-utl/am2008011.pdf
A casual gambler who elects to itemize deductions may deduct wagering
losses, up to wagering gains, on Form 1040, Schedule A. In this case, the taxpayer
may deduct only $350 of her $610 of wagering losses as an itemized deduction. A
casual gambler who takes the standard deduction rather than electing to itemize may
not deduct any wagering losses. See Rev. Rul. 54-339, 1954-2 C.B. 89
See IRS Publication 17 page 104 - https://www.irs.gov/pub/irs-pdf/p17.pdf#page=104
You can't reduce your gambling winnings by your gambling losses and report the difference. You must report the full amount of your winnings as income and claim your losses (up to the amount of winnings) as an itemized deduction. Therefore, your records should show your winnings separately from your losses.
