Turbotax blog post on gambling winnings is completely wrong

Forum|Forum|3 years ago
January 11, 2023
2 replies
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Among other factual errors and grammar mistakes, the article says:

“If you take home a net profit exceeds $600 for the year playing on websites such as DraftKings and FanDuel, the organizers have a legal obligation to send both you and the IRS a Form 1099-MISC.”

Sportsbooks will only produce a 1099 if you have a SINGLE wager that is BOTH at odds of 300-1 or more AND results in winning $600 or more. There is no 1099-MISC filed for net winnings on the year, which the article incorrectly states. This article should be corrected or taken down immediately.

Source: IRS.gov and direct conversations with relevant sportsbooks in early 2023.

Link to article: https://www.shorturl.at/coIJS

For some reason, links do not work, so please Google:

"Sports Betting Taxes Guide (How to Pay Taxes on Sports Betting)"

It's the very first result.

Not A Product Question

Bsch4477

https://help.draftkings.com/hc/en-us/articles/4414347431955-What-are-the-1099-Misc-reporting-thresholds-for-DraftKings-Daily-Fantasy-Sports-winnings-

What are the 1099-Misc reporting thresholds for DraftKings Daily Fantasy Sports winnings?

If you have greater than $600 of net earnings during a calendar year, you can expect to receive an IRS Form 1099-Misc from DraftKings no later than February 28th. This form will include all net earnings from the prior calendar year.

BillM223

Where did you see on IRS.GOV that someone should issue a 1099-MISC for each win over $600? That's not the way the IRS wants you to operate.

On the IRS page about the 1099-MISC, it says:

"File Form 1099-MISC for each person to whom you have paid during the year (emphasis mine):

At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest.
At least $600 in:
- Rents.
- Prizes and awards.
- Other income payments..."

That is, if the sports website has paid in the aggregate $600 or more to a bettor over the course of the year, the sports website will send the bettor and the IRS (each) a 1099-MISC. If a bettor wins three bets of $201 each, he/she would receive one 1099-MISC for $603. If the bettor wins three bets for $601, the bettor will get one 1099-MISC for $1,803, not three 1099-MISCs for $601.

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