The US tax literature states that gambling taxes can be offset by gambling losses. The Canada US tax treaty ensures that Canadians are entitled to receive the same treatment as domestic US taxpayers. Since American gamblers can and receive refunds for their casino taxes, Canadians are also eligible. The United States IRS imposes 30 percent casino tax on Canadians winning in Las Vegas. This is a mandatory tax rule followed by all US based casinos and other gambling hubs. So do not be surprised if you can not get all your winnings from the casino. However, you can still get back your money through a tax rebate.

Canadian Taxes

US Taxes

U.S. citizens, Green card holders or residents are taxed on their worldwide income from all sources, both inside and outside of the United States including Canada. U.S. persons who are residents of Canada must file US income tax returns (1040). Canadians with U.S.-source income or owning rental property in the US must also file US income tax returns (1040 or 1040NR). Have questions? contact Fair Tax Business Services in Kitchener, Ontario, Canada. We have been providing US and Canada cross border income tax preparation services to co-op students, faculty and staff at the Universities of Waterloo, Wilfred Laurier, Guelph, South Western Ontario, Windsor and other Universities since 1995. We can also help you with U.S. gambling tax recovery, Canadians owning US real estate.

Us Gambling Refund Canada Tourist

We prepare personal and small business income tax returns for Canada and the United States. We have been preparing income tax returns since 1996. At Fair Tax Business Services we understand your needs as individual and small business taxpayers.

Fairtax Business Services has been serving Kitchener, Waterloo (K-W), Cambridge, Guelph, Elmira, London Ontario, Toronto and surrounding communities and areas with their Canadian and cross border income tax preparation needs since 1996. We have clients located in other communities in Ontario as well as other provinces in Canada. Our fee includes free e-filing (electronic filing). Please contact Fairtax Business Services for Revenue Canada (CRA) e-filing (electronic filing) eligibility criteria.

Us Gambling Refund Canada Tax

We provide instant express cash refund. Bring in your tax papers and receive your instant tax refund in cash back to you or cheque in less than one hour (some restrictions may apply).

Gambling Taxes: The Canada-US Tax Treaty

It’s a fact: Canadians like to gamble. Whether we’re hitting the local casino for the night, or taking a jaunt down to Las Vegas for a week, we love the thrill of a game of chance, and the possibility that this time, just maybe, we’ll be the ones to win big. Of course, the culture surrounding gambling differs slightly between Canada and the US, and there is one significant difference that often blindsides Canadians visiting US casinos: the gambling winnings tax.

In Canada, gambling winnings, be they from casino games or from playing the lottery, are generally not considered a taxable source of income – these winnings are clearly not generated by an office, employment, or property, and barring a few anomalous instances, gambling is not considered by Canadian law to be a business. It relies too much on chance, and almost no one is capable of making a steady income at gambling. So for Canadians gambling at home, what we win is what we get, whether it’s $100 from playing quarter slots, or $1,000,000 from playing a provincial lottery.

This isn’t the case in the United States. Under US law, substantial gambling winnings – which typically means wins over $1200 – on games other than blackjack, baccarat, craps, roulette, and the big-6 wheel are considered taxable income. For Canadians (and other non-resident aliens), the gambling winnings tax is 30% of the total win. This tax is withheld at the source, so while you might walk out with $100 if that’s all you win in a US casino, if you win $1500, you’ll be walking out with $1050. That’s a not-insignificant loss of money, and the more you’ve won, the more you’ll lose in casino withholding taxes.

Prior to 1996, that would have been the end of it. A Canadian gambling in the US would have to walk away from the casino with their winnings, less the gambling withholding tax, and be happy for the amount they were able to keep. However, the introduction of Article XXII of the Canada-US Tax Treaty changed this. Under the Treaty, Canadians are now allowed to deduct US-source gambling losses from their US-source gambling winnings, and obtain a casino tax refund based on that amount.

To qualify for casino tax recovery as covered by Article XXII of the Canada-US Tax Treaty, you need to be able to substantiate all US-source gambling losses. To this end, it’s a good idea to keep a diary of all wins and losses made in the US, including dates, times, locations, and amounts won and lost. Also acceptable as proof are statements issued by the casino, wager tickets, casino credit records, and bank withdrawal statements.

In order to file for casino tax recovery, you’ll need to obtain an ITIN, or Individual Taxpayer Identification Number, from the IRS if you don’t have one already, and file a non-resident tax return. This will cover your gambling wins and losses for the entire year. Improperly completing either the application for your ITIN or the tax return form can drastically lengthen the wait time, or in the latter case, potentially result in you not getting any of your money back. To prevent this, you would be well advised to engage the services of a refund management firm familiar with the process of casino tax recovery to fill and file the required forms, and to ensure that you have all the necessary documentation on hand. US Tax Recovery is a good bet for all your casino tax recovery needs.