Welcome back! Ask questions, get answers, and join our large community of tax professionals.
Showing results for 
Search instead for 
Did you mean: 

Taxation from State to State regarding gambling wins

Level 3

I have been reading, researching this question with so many different answers being offered by different websites, etc.  Gambling wins from Toledo, Ohio won by a Michigan resident. From my research a Michigan resident is basically taxed three times on the win. State of Michigan clearly states all gambling wins by Michigan residents are subject to Michigan income tax. State of Ohio clearly states all gambling wins from their state are taxed, even by reciprocal states e.g. Michigan. I have seen a large accounting firm pull out as a subtraction Schedule 1 Michigan return the full win from Ohio. Error #1. I have also seen the local Toledo city tax paid 2.5% on the win taken as a credit for other taxes paid. Error #2. I questioned Michigan Department of Treasury on all these different discrepancies on the taxation. Michigan Treasury's response on 02/18/2022 was as follows: No, you may not claim a credit for taxes paid to another government agency on gambling winnings." I have read advice on an intuit site that as a Michigan resident with an on-site win from Ohio, you will get a credit on the taxes you paid to Ohio from Michigan. Not according to the Michigan Department of Treasury. Ohio states all gambling income from that state must file a return, resident or non-resident and again even if non-resident is from a reciprocal state. I have seen this income treated multiple different ways and there really should only be one way - the correct one. Is anyone familiar with this - what am I missing? I would like to be that person that gets a client money back but it needs to be correct. Anyone else run into this?

Thanks so much for your time as this is very frustrating for me.

0 Cheers