Retiree loves the slots. Plays all day long, wins some, loses some. Comes out even if she's lucky. I've told her for years to stay out of the casinos, she tells me to mind my own business.
This year she has about 15,000 of gambling winnings and about 20,000 of gambling loses. Winnings on line 21, losses to the extent of gains on schedule A.
Wait a minute - owes $1000 when last year had a refund of $500!
What's going on here?
Ah - the increase in provisional income made an extra $10,000 in her social security taxable even though she didn't have a dime in additional "income"!
Am I missing something here?