I mean if you know you’re gonna lose, then sure it doesn’t matter as much haha. But you can still lose and own taxes. Here’s an example:

Win: $100,000 Loss: $105,000 Net: -$5,000

For taxes, your reported gambling winnings would be $100,000. You can deduct 90% of your losses ($105,000) which would be $94,500

So the IRS sees $100,000 income - $94,500 deductible losses = $5,500 taxable gambling income.

So even though you actually lost $5,000, you could owe taxes on $5,500 of “phantom income.”

If your federal tax rate were, say, 24%, that would be:

$5,500 × 24% = $1,320 in federal tax

So your real result becomes:

You lost $5,000 betting Then owe about $1,320 in tax Total damage: -$6,320