Canadians with US Gambling Income

Canadian Resident

If you are a Canadian resident and have had 30% tax withheld from lottery or gambling winnings in the US, some or all of the tax can be recovered if:

  • you also have US gambling losses to offset some or all of the winnings, or
  • US taxes were withheld from winnings from blackjack, baccarat, craps, roulette or big-6 wheel.

In order to get a refund from the IRS (Internal Revenue Agency) of US income taxes withheld from lottery winnings or gambling winnings, Canadian residents must file a US tax return.  The US tax return to be filed is Form 1040NR—US non-resident alien income tax return. You can e-File this form via Start and eFileIT!

Your lottery winnings, as well as your gambling winnings and losses, will be recorded on Schedule NEC  (as part of Form 1040NR) as long as you are not engaged in the trade or business of gambling. 

  • Access Schedule NEC for Form 1040-NR here or click on this link:
  • Instructions: Gambling and lottery winnings for residents of Canada are included on line 10a of Schedule NEC.  Proceeds from lotteries and raffles are also included on line 10a, but winnings from blackjack, baccarat, craps, roulette, or big-6 wheel are not included here.  Gambling losses are entered on line 10b, with net gambling income (zero if negative) entered on line 10c.

If you have winnings from blackjack, baccarat, craps, roulette, or big-6 wheel, and the casino gave you a Form 1042-S (Foreign Person’s US Source income subject to withholding) showing that tax was withheld, enter these winnings in column d of line 10, with a tax rate of zero.  You can claim a refund of the tax.

The US Canadian Tax Convention or Treaty

Read more here about foreign Income, the foreign income exclusion and Aliens and Taxes