I have about 200k (from daily withdrawals and deposits) but my deposits outweigh the withdrawals. I will be keeping my PayPal log for 2022 to show proof that the 1099-K was NOT taxable income. I don't know any other way to do it than report the 1099-K and back it out as an expense with a reason. I will also be keeping the log I can export from the online sportsbook to keep just incase they want to make sure I don't have gambling income (which I don't have any).
The IRS needs to expand their gambling tax laws and not make this so difficult each year. The online casinos should be reporting your winnings in a W2G at the end of the year since they can now track everything right in their systems.
