For Canadians gambling in United States casinos, “What happens in Vegas, doesn’t have to stay in Vegas”.
Unlike Canada, the United States considers winnings from gambling and lotteries to be taxable. Under the Tax Law jackpots of $600 or more will incur a non-resident withholding tax of 30%. So if you win $10,000 you only go back to Canada with $7000.
But as a Canadian, can you get that money back? The short answer is maybe. The US-Canada Tax Treaty allows Canadians to deduct their U.S. gambling losses (with a few exceptions) in a given year from winnings.
How do you substantiate the losses? You don’t have to submit your receipts to the IRS. Read more