The Schedule 1, line 8 for 2021 has been expanded into several lines, namely lines 8.a. through 8.z. In prior years if you had received a 1099-Misc, Turbotax would ask what the nature of the 1099-Misc was. One of the choices was "Gambling" and it was recorded on a single line 8 along with your W-2G winnings (so you could offset all gambling losses against line 8).
To deal with the situation in tax year 2021 where the line 8. on Schedule 1 has been expanded, is to simply "override" the entry where an amount from a 1099-Misc has been entered on one of the line 8 subsections, blank that entry out and add it to line 8.b. where "Gambling" winnings are shown. (The problem here is that Turbotax did not give the option of describing the 1099-Misc as having been derived from Gambling activities.) I did this, all worked well, and my return was accepted by the IRS. If the IRS should ever question this, you can simply explain to them what you did and why. You reported all income, so there should not be a problem.
The thing to remember is that, regardless of the form used, "gains from wagering activities" is the essence of what the IRC (Internal Revenue Code) speaks to, and gains can be reported on Forms W-2G as well as a 1099-Misc.
It is very important, to stress what I have previously mentioned, that the IRC speaks of "Gains from wagering activities," and "Losses from wagering activities." It does not say winnings from gambling or losses from gambling. Furthermore, it does not define anywhere in the IRC what it means by "Gains from or Losses from wagering activities." Both the terms "Gains" and "Wagering" activities are much broader in their meanings.
It therefore follows that something like gains from casino drawings, where the tickets are earned from slot machine play, could easily fit into the definition of gains from wagering, thus losses could be applied to both the amounts reported on W-2G and Form 1099-Misc.
In a previous reply to this question, I referred to the Tax Court case, Libutti vs. The Commissioner dated March 7, 1996. In that case, a heavy gambler (Libutti) spent millions of dollars gambling at a New Jersey casino. The casino, in turn, and as an enticement to frequent the casino, gave Libutti expensive gifts, including exotic cars, diamond jewelry, expensive travel vouchers, etc. exceeding $2.5 million in value. The casino issued 1099-Misc forms to Libutti for the value of these "comps" or gifts and Libutti, in turn, applied his gambling losses against all of the 1099-Misc income. The IRS took the position that Libutti could not offset his losses against such gifts (comps). However, the Tax Court sided with Libutti, in essence saying that the strong relationship between his gambling activities at the casino, and the casino's providing comps or gifts to Libutti all fell into the meaning of "gains from wagering activities" and, therefore, he could offset his losses against both the wagering winnings (gains) as well as the comps (gains). They pointed out the obvious in saying that such gifts or comps never would have been given to Libutti except for his gambling activity. In other words, the character of his gains was the same regardless of how they were received or on what forms they were reported. There is a similar relationship between gains from slot machine play, and gains from drawings where the tickets for the drawings are earned because of, and only because of, machine play. Though the gains from the slots are reported on Form W-2G, and the gains from the drawings are reported on Form 1099-Misc, the wagering losses for machine play can be offset against both.
