Ask Tom Anything - July 31, 2023
Prizes versus wagers and your questions answered
In a prior edition of Ask Tom Anything, a subscriber asked the following question:
A taxpayer won $5,000 in fishing tournament. Their entry fee was $1,500. Is the entry fee deductible from the gross proceeds or elsewhere on the tax return?
Assuming this is not a trade or business activity to the taxpayer, the answer comes down to whether this is a prize or a wagering activity.
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