I agree that it is a flaw in the Turbotax software - they should ask at the time of entry of the 1099-Misc information if this relates to gambling or wagering activity, like they have in prior years. I got around this by going to the form, overriding the entry on Schedule 1, Line 8, blanking out the amount and re-entering it on line 8.b. (gambling). That way the losses can be offset and it passes muster with the IRS.
