Mass Scedule Y

[droykelly]

I have gambling winnings from a Mass casino and am able to offset up to the amount won with losses from a Mass casino however Turbo Tax doesn't show a schedule Y in my Mass return.  Is there a way to add it or correct the error?

[JohnB5677]

For Massachusetts purposes, losses (up to as much as winnings aren't deductible even if they may be claimed as an itemized deduction on U.S. Form 1040 (Schedule A). The exception is gambling activities that are considered a trade or business or any gambling establishment in accordance with MGL Chapter 23K.

If the taxpayer was a Massachusetts resident, the full $amount would be included in Massachusetts income with no offsetting deduction.  So, if the taxpayer won $amount on a lucky visit to the casino but let it ride and actually lost all $amount of it, for federal tax purposes that taxpayer would have net federal income of zero. However, if the taxpayer lived in Massachusetts, the full $amount would be included in state income with no offsetting deduction so the taxpayer would pay state income tax on the full $amount.

[droykelly]

Sorry, but this information is incorrect.  A Mass resident can deduct, on Schedule Y, losses from a Mass licensed casino up to the amount won in a Mass licensed casino.  I won in a Mass cassino and had losses in that same casino therefore can claim a loss, up to the amount won, on Schedule Y.  That's why I was asking how to add the Schedule Y to my Mass Form 1.

From Mass DOR website --

For tax years beginning on or after January 1, 2015 a deduction is allowed from Part B income for gambling losses incurred at certain licensed gaming establishments or "racing meeting licensee or simulcasting licensee" establishments but only to the extent of winnings from such establishments included in gross income for the calendar year. See TIR 15-14 and Schedule Y, line 17 for more information. The new gambling loss deduction is the only deduction for gambling losses allowed for a Massachusetts taxpayer, unless the gambling activities constitute a trade or business. See DD 03-3. Note that Massachusetts does not adopt the federal deduction under IRC § 165(d) for gambling

[LindaS5247]

The Massachusetts State website states the following regarding gambling losses:

Cash winnings are included in federal gross income and so you must include it in Massachusetts gross income. Cash winnings include:

Dog and horse track betting, jai alai, and other wagering transactions

• Sweepstakes and wagering pools
• Bingo or beano, keno and slot machines
• Poker tournaments, including casinos
• Raffles or any other events of chance

Losses occur when:

• The total amount you paid to gamble is greater than your total gambling winnings, or
• The total cost of lottery tickets is more than your total winnings on those tickets

For Massachusetts purposes, losses (up to as much as winnings) aren't deductible even if they may be claimed as an itemized deduction on U.S. Form 1040 (Schedule A). The exception is gambling activities that are considered a trade or business or any gambling establishment in accordance with MGL Chapter 23K.

Under the new provision a taxpayer may claim a deduction for gambling losses incurred in a calendar year only if the losses were incurred at any gaming establishment licensed in accordance with MGL ch 23K or a racing meeting licensee or simulcasting licensee and only if the taxpayer had wagering winnings from any such gaming establishment licensed in accordance with MGL ch 23K or a racing meeting licensee or simulcasting licensee in the same calendar year. The deduction allowed for such losses may not exceed the amount of such winnings included in gross income for the calendar year.

The above conditions must exist in order for your gambling losses to be deductible.  Contact your gambling establishment to ensure all of these conditions are met before deducting your gambling losses.

Schedule Y may not yet be released for e-filing by Massachusetts yet. You can try typing Form Schedule Y in the TurboTax search bar.

Or, if your gambling is considered a trade or business which meets the following:

Gambling activities considered a trade or business:

You can deduct wagering losses (for as much as you won) from your personal income taxes, but only if your wagering activities are considered a trade or business.

For professional gambling, your gambling activity is considered a trade or business if it is:

• Pursued full time
• In good faith
• Done regularly
• To produce income for a livelihood
• Not a hobby

Click here for information regarding gambling losses in the state of Massachusetts.

Click here for additional information regarding Massachusetts deduction of gambling losses.

Click here for information on Turbo Tax Support.