Can I Deduct Lottery Tickets?

Buying lottery tickets is a form of gambling, and the IRS treats it the same way it treats any other gambling activity. If you win, you must report the winnings as income. If you have losses from buying tickets that did not win, you can deduct those losses, but only up to the amount of your gambling winnings for the year. You cannot deduct more in lottery ticket losses than you won from any gambling activity during the year. To claim the deduction, you must itemize rather than take the standard deduction. Keeping a record of your ticket purchases is important if you plan to claim the deduction, since the IRS may ask for documentation.