Taxing the House Edge Some gamblers are buying losing lottery tickets on eBay to offset their winnings, a dubious tactic that has caught the attention of tax experts.
This practice is not surprising, given the complexity of the US tax code.
A narrow provision in the tax code (IRS Topic 419) allows gamblers to deduct losses from their winnings if they itemize and keep accurate records, but the deduction is capped at the amount of winnings reported.