Pay Taxes On Your Super Bowl XLVII Winnings?

It comes as no surprise to anyone (except maybe eternal optimist Jeff Lurie) that the Eagles aren’t in the Super Bowl this year. And my other “go to” teams didn’t make it either. As a result, I have no real allegiance to either of the teams in the Super Bowl this year, though I do have a favorite: I’m in the 49ers camp because of an odd allegiance for Pennsylvania native Joe Montana.

My kids, however, are rooting for the Ravens. That has everything to do with the fact that they love Harry Potter and were, until somewhat recently, fairly convinced that the team was called the Voldemort Ravens.

It’s slated to be a record-breaking day in Vegas. More than $90 million will be legally gambled away on the game in Sin City. Many more million will be wagered in garages, office pools and bars across the country. This year, you can bet on everything from the winning team to who will score first and which Harbaugh brother – or both – will sport a cap during the game.

What does all of this mean come tax time? The law requires you to report your gambling winnings no matter what the amount – or whether it’s a legal bet. There’s no exception for illegal wagers: income is income so far as the Internal Revenue Service is concerned. Casual gamblers – that means most taxpayers – must report their winnings on line 21 (other income) of a federal form 1040; the form 1040-EZ isn’t equipped to handle gambling winnings or the forms W-2G.

But what if you lose? Unfortunately, while you must claim all gambling winnings on your return, you can only deduct your losses if you itemize your deductions on a Schedule A. If you do not file a Schedule A, you cannot deduct your gambling losses, no matter how much you lose. Thankfully, losses are considered a miscellaneous deduction and not subject to the 2% limit.

If you do itemize your deductions, you must be able to document your losses. You need to substantiate the amount of the loss, the date of the loss and the name and location of the gambling establishment. Be smart and keep a journal of your gambling wins and losses: chances are, your buddies at the office aren’t going to be in the mood to issue you a form 1099-G. Ditto for your extra large bookie in the bar corner.

What if you lose more than you win? Sadly, you’re out of luck. Not only does it stink to keep losing, you cannot deduct more in losses than you report in winnings. If this happens more than you care to admit, consider getting some help. You can start by calling 1800-GAMBLER.

Assuming that you just do it occasionally, playing the odds whether at the casino or as part of the office pool can be fun. Don’t be fooled, however: there are also real tax and financial consequences (and depending on the nature of the bets, also legal) to making wagers. Make sure you understand how bets, no matter how big or small, may affect you. If you can’t stand the heat, just hang out by the chip bowl.

Outgoing Defense Secretary Leon Panetta today became the highest-ranking Obama administration official to admit that the U.S. used torture to help find Osama Bin Laden.

Panetta was responding to a question on the movie “Zero Dark Thirty,” which depicts prisoners being waterboarded by the US in an effort to find out where bin Laden’s is hiding.

“The movie seems to say, to indicate that enhanced interrogation techniques or torture was used to get information to get Bin Laden. Is that true?” asked NBC’s Chuck Todd on “Meet the Press.”

“Yes, some of it came from some of the tactics that were used at that time, interrogation tactics that were used,” Panetta responded.

“The real story was that in order to put the puzzle of intelligence together that led us to Bin Laden, there were a lot of pieces out there that were a part of that puzzle,” Panetta added.

But the former CIA Director dismissed the tactics as playing a key role as the movie depicts in the location of Bin Laden, who was shot and killed in May 2011 by Navy SEALS while he was hiding in a compound in Abbottabad, Pakistan.

“The fact is we put together most of that intelligence without having to resort to that,” Panetta said. “I think we would’ve gotten Bin Laden without that.”

Panetta’s stance is different from that of Bush administration officials, who have called the “enhanced interrogation” methods that were used under them critical to the operation.

Meanwhile, Panetta blamed the nation’s intelligence community for the failure to get the military to Benghazi on Sept. 11 after the consulate was attacked.