When preparing the New Jersey tax return for a resident who has gambling winnings and losses on their federal return, the preparer will need to calculate and enter the net gambling winnings in the New Jersey return. They won't carry into the New Jersey return automatically from the federal return since some New Jersey gambling winnings are not taxable, specifically:
- New Jersey Lottery individual prizes $10,000 or less;
- Any multistate lottery in which New Jersey participates (e.g., Mega Millions, Powerball) individual prizes $10,000 or less.
Thus, the preparer needs to calculate and enter the net gambling winnings in the New Jersey return, i.e., the taxable winnings less losses, if any.
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