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Old 01-20-2014, 01:19 PM
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Illinois Resident/Indiana Gambling Winnings

Hello,
Hoping to get some feedback here. I am a full-time Illinois resident. Early 2013, I won 4 taxable jackpots at an Indiana casino. They took out state taxes each time before paying it out to me. How do I handle my taxes? Do I have to file in Indiana? If so, what form? How does that impact (if at all) my Illinois return?

I've always filed my own taxes because they're very straightforward. I'm hoping I can still do that this year.

Thank you!!



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Old 01-20-2014, 10:44 PM
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Quote:
Originally Posted by kmw461 View Post


#1;Hoping to get some feedback here. I am a full-time Illinois resident. Early 2013, I won 4 taxable jackpots at an Indiana casino. They took out state taxes each time before paying it out to me. How do I handle my taxes?


#2; Do I have to file in Indiana? If so, what form? How does that impact (if at all) my Illinois return?
#1;You, as a full year resident of IL, need to report yur gambling winnings that you earned in IN state to IL;however, as you pid IN tax to IN , and there is no Reciprocal Agreements between IN and IL, you can claim IN tax paid to IN on your IL return.






#2;When you live in a state that collects income taxes,IL, but work in another state, IN,which also has income taxes, you may fear having to pay taxes twice. It's true that you'll have to pay taxes on your earnings in both states. You will need to file a nonresident return for the state in which you work, plus a normal resident return for the state in which you live. However, the situation is not as bad as it may seem. That's because while you have to file income taxes in both states, the state in which you live will give you a credit for any taxes paid to the nonresident state. You'll file an IN non-resident return showing only the gambling winnings and pay whatever tax is due. Then you'll take a credit on your IL return for the IN taxes paid, up to the amount of tax that IL would have collected. This avoids double taxation, but you will pay tax at the higher of the two states' rates.



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Old 01-21-2014, 12:05 PM
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I work in Illinois as well as live there. The only income I have from Indiana is the casino winnings. Therefore, I'm reading your response in #1 that I do not have to fill out a return in Indiana, but need to claim winnings & taxes paid on my Illinois return. Correct?



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Old 01-21-2014, 12:12 PM
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please read #2 response



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Old 01-21-2014, 12:24 PM
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I did read #2. The first sentence states:
#2;When you live in a state that collects income taxes,IL, but work in another state, IN,which also has income taxes, you may fear having to pay taxes twice.

I don't work in Indiana so not sure how this applies to me. Guess you weren't very clear.



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