I’m pretty confident that the $85 would only be a loss if you loose the bet, which is not the scenario we are considering. I haven’t found anything specifically on predictit, but here’s what I found on slot machines, and I think the analogy is pretty clear:
”A taxpayer recognizes a wagering loss if … the total dollar amount of wagers placed by the taxpayer on electronically tracked slot machine play exceeds the total dollar amount of payouts from electronically tracked slot machine play during the session.”—https://www.thetaxadviser.com/issues/2016/oct/taxation-of-gambling.html
Second, while all gambling gains are reportable, only large wins get automatically reported (>$1200 or 100⁄1, I believe, depending on format). These are generally reported on a Form W-2G, not a Form 1099. You may deduct gambling losses against your reported win IF you itemize deductions (if you take the standard deduction, you’re out of luck). Further, if you are a professional gambler (i.e. as a primary source of income) you may deduct all losses, even beyond your winnings (but none of us are professional gamblers, so don’t try that).
I’m pretty confident that the $85 would only be a loss if you loose the bet, which is not the scenario we are considering. I haven’t found anything specifically on predictit, but here’s what I found on slot machines, and I think the analogy is pretty clear:
”A taxpayer recognizes a wagering loss if … the total dollar amount of wagers placed by the taxpayer on electronically tracked slot machine play exceeds the total dollar amount of payouts from electronically tracked slot machine play during the session.”—https://www.thetaxadviser.com/issues/2016/oct/taxation-of-gambling.html
First, PredictIt issues a 1099 on net income. They remove your investment for you automatically. IT IS NOT CONSIDERED GAMBLING. https://predictit.freshdesk.com/support/solutions/articles/5000692877-how-do-you-calculate-a-trader-s-net-profit-for-tax-reporting-purposes-
Second, while all gambling gains are reportable, only large wins get automatically reported (>$1200 or 100⁄1, I believe, depending on format). These are generally reported on a Form W-2G, not a Form 1099. You may deduct gambling losses against your reported win IF you itemize deductions (if you take the standard deduction, you’re out of luck). Further, if you are a professional gambler (i.e. as a primary source of income) you may deduct all losses, even beyond your winnings (but none of us are professional gamblers, so don’t try that).