1099-MISC for Gambling winnings

[geraldgintercpa]

A client of mine received a 1099-MISC for gambling winnings. He had losses that were able to offset the winnings. He was able to itemize his deductions to offset the winnings with the losses. The return was rejected with the following explanation: "If Schedule A (Form 1040), 'Other Miscellaneous Deduction Amt' has a non-zero value, then Schedule 1 (Form 1040), 'Gambling Reportable Winning Amt' must be greater than or equal to 'Miscellaneous Deduction Amt' in [Other Misc. Deductions Stmt.] with corresponding 'Miscellaneous Deduction Type Desc.' having the value "Gambling Losses". I reported the 1099-Misc amount in Box 3 and checked the box "Winning (Prizes, etc.). Schedule 1 shows the income as "Prizes and Awards". Shouldn't the client be able to deduct the cost of entering the tournament where the prize was earned?

[Just-Lisa-Now-]

1099MISC is usually given for prizes and awards, not wagering money gambling.

You sure this is gambling winnings?

[geraldgintercpa]

It was a prize. The client travelled and paid an entry fee to enter the tournament.  Shouldn't the client be able to deduct the entry fee and expenses related to that prize?

[IRonMaN]

But you are changing the story as you go.  Gambling losses are ok to deduct, sounds like you want to deduct miscellaneous itemized deductions to offset the income which disappeared from the federal return a few years ago.

[Just-Lisa-Now-]

those aren't gambling losses

[BobKamman]

Entering tournaments is not gambling.  Usually questions like this involve, "where do I put my client's bass boat on Schedule C?"

[geraldgintercpa]

Thanks for your replies! I got the message!!!

[Accountant-Man]

I have a client who won a prize and it was on 1099-NEC.

[LilFos]

I would like to give you my example of this. I have a client who received a 1099-Misc for a truck that was won at a casino, I placed the amount in Box 3 as Other Income and checked the box for Winnings(Prizes, etc.) The information you get when you click on the About Prizes indicates that the amount will transfer the income to line 2b (of the Other Income Statement.

However it does not do the transfer. Am I reading this incorrectly. Please advise

[BobKamman]

@LilFos  Works for me.  Did you enter the amount on the first line, then check the box for Winnings?  It also works if you just check the box for "Other Income."  Try updating the program, including "Repair Updates."

[Just-Lisa-Now-]

I just tested on, I entered a 1099MISC with 24k in box 3 and marked it as Winnings and it transferred it to Line 8i (prizes and awards) of Sch 1 as well as Line 8 of the 1040.