topic I had $1.00 lottery win. When I enter this amount in TurboTax, and my $72.00 in losses, my tax owed goes up $12. How can I owe $12 tax on my $1 win? in Get your taxes done using TurboTax

I had $1.00 lottery win. When I enter this amount in TurboTax, and my $72.00 in losses, my tax owed goes up $12. How can I owe $12 tax on my $1 win?

blizz31393 — Tue, 03 Feb 2026 13:45:03 GMT

Re: I had $1.00 lottery win. When I enter this amount in TurboTax, and my $72.00 in losses, my ta...

MonikaK1 — Mon, 03 Feb 2025 22:54:59 GMT

Gambling losses are only deductible up to the amount of gambling winnings.

To report your gambling losses, you must itemize your income tax deductions on Schedule A. If you claim the Standard Deduction, then you can't reduce your tax by your gambling losses. The IRS doesn't permit you to ‌subtract your losses from your winnings and report the difference on your tax return.

See this tax tips article for more information.

The entry field for gambling losses is actually in the Income section:

Go to Federal Taxes tab ( Personal Tab in Self-Employed)
Click Wages & Income
Select I'll choose what I work on
Then go to Less Common Income
Click Gambling winnings
Once you have entered your gambling winnings, click Done. After answering more questions, click Continue. Once you finish the questions for this area you will be provided an entry field to enter your gambling losses.

If you just added $1 to your taxable income, yet your tax went up by $12, it's probably because that $1 moved your taxable income into the next tax bracket and/or the next line of the tax tables. See here for the 2024 tax brackets and tax tables.

[Edited 02/03/25| 2:53pm PST] @blizz31393: (edited)

Re: I had $1.00 lottery win. When I enter this amount in TurboTax, and my $72.00 in losses, my tax owed goes up $12. How can I owe $12 tax on my $1 win?

Opus 17 — Mon, 03 Feb 2025 18:50:19 GMT

It's the tax tables. To make taxes easier for most, the IRS gives tables with the tax rather than using a mathematical formula. As you can see in this example, there are situations where adding $1 of income can increase the tax by much more than $1. A $12 increase would suggest your overall income is in the 24% bracket.

Then, gambling losses will not decrease your taxable income unless your total itemized deductions are more than your standard deduction. Itemized deductions including state and local taxes, mortgage interest, and gifts to charity. If you have not entered all your itemized deductions yet, your tax may change as you continue to add information.