Should I report Gambling and Lottery Winnings?

For Pennsylvania residents, all gambling and lottery winnings from any source, except prizes from playing the Pennsylvania State Lottery, are taxable on your Pennsylvania return. As a resident, you must include lottery winnings from other states and countries.

For nonresidents, all gambling and lottery winnings from Pennsylvania sources, except prizes from playing the Pennsylvania State Lottery, are taxable on your return.

Gambling and lottery winnings include cash, the value of property (automobiles, jewelry, electronic devices, appliances, clothes, etc.), the value of the use of property (trips, vacations, airline tickets, cruises, etc.), and other items of value. You may only deduct your costs of gambling, wagering, betting, and playing lotteries from your winnings. You may not deduct any expenses (programs, tip sheets, travel, meals, lodging, etc.) that you incurred to take part in gambling, wagering, betting, and lottery activities.

Important: You may not deduct the cost of Pennsylvania State Lottery tickets from other taxable gambling and lottery winnings.

For more information, see the PA-40 instructions.

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