I understand you enter your winnings on a schedule C, but where exactly do you report the state taxes that were withheld on the W2G? Thats should count toward taxes paid to the state just like state taxes that are withheld on a weekly paycheck.
Last year, i called turbo tax and asked this question and they told me in the business expenses section, there is a section for additional taxes and license fees paid to a local or state govt. So, I entered all the state withholdings there. Then i get a letter from kansas saying i over reported what was paid to them by the exact amount the was withheld on w2gs. So i called them and told them to look at all the w2gs that were included in my filing. They said it was not entered properly, but they accepted it and changed something i guess. They however could not give me official tax advice and say what i should have done.
