Updated October 24, 2026. Quick answer: Line 8 of the Pennsylvania PA-40 is where you report gambling and lottery winnings. The form tells you to complete and submit PA Schedule T, and the booklet explains what counts as winnings and what costs may be deducted. The line 8 amount then goes into the line 9 total. This page walks through what the booklet and the form print for line 8.
What this line does
The booklet’s instruction heading for this line is “GAMBLING AND LOTTERY WINNINGS”. On the form, line 8 sits on the first side, the page marked Side 1, and reads “Gambling and Lottery Winnings. Complete and submit PA Schedule T.”
The booklet opens the topic with its main rule: “PA law imposes its income tax on PA residents on all gambling and lottery winnings from any source, including cash prizes from playing the Pennsylvania Lottery paid on or after Jan. 1, 2016.” Line 7, covered on Pennsylvania Form PA-40 line 7, comes just before it. For the whole sequence see Pennsylvania Form PA-40 line by line.
Who it applies to
Residents and nonresidents are treated in separate paragraphs. For residents: “As a PA resident, you must also include gambling and lottery winnings from other states and countries.” For nonresidents: “Nonresidents should report only gambling and lottery activity that occurs in PA.”
Lottery players are covered in a subsection headed “Powerball and Mega Millions”, which separates tickets bought in Pennsylvania from tickets bought in another state. The federal side of winnings reporting is on Form W-2G boxes explained and Form W-2G for lottery and sweepstakes winnings.
What the instructions say
| Line | What the form says |
|---|---|
| Form, line 8 | “Gambling and Lottery Winnings. Complete and submit PA Schedule T.” |
| Residents | “PA law imposes its income tax on PA residents on all gambling and lottery winnings from any source, including cash prizes from playing the Pennsylvania Lottery paid on or after Jan. 1, 2016.” “As a PA resident, you must also include gambling and lottery winnings from other states and countries.” |
| Nonresidents | “PA law imposes its income tax on nonresidents on all gambling and lottery winnings from PA sources” “Nonresidents should report only gambling and lottery activity that occurs in PA.” |
| Nonresidents, other states | “Do not report winnings or losses from wagers placed in any other state or country on PA Schedule T.” |
| What counts as winnings | “Gambling and lottery winnings include cash, the value of property (automobiles, jewelry, electronic devices, appliances, clothes, etc.), the value of the use of property (trips, vacations, airline tickets, cruises, etc.), and other items of value except noncash prizes of the Pennsylvania Lottery.” |
| Costs you may deduct | “You may only deduct your costs of gambling, wagering, betting, and playing lotteries from your winnings.” |
| Expenses you may not deduct | “You may not deduct any expenses (programs, tip sheets, travel, meals, lodging, etc.) that you incurred to take part in gambling, wagering, betting, and lottery activities.” |
| Lottery tickets | “You may only deduct the cost of Pennsylvania Lottery tickets from PA-taxable gambling and lottery winnings for tickets purchased on or after Jan. 1, 2016.” |
| Powerball and Mega Millions, bought in Pennsylvania | “If you purchase a Powerball or Mega Millions ticket in Pennsylvania, whether a PA resident or not, any cash prize you win is taxable for PA PIT purposes if the prize payment is made on or after Jan. 1, 2016.” |
| Powerball and Mega Millions, bought in another state | “If you are a PA resident and purchase a Powerball or Mega Millions ticket in another state, any prize you win is PA-taxable income regardless of the date the prize is paid.” |
| Schedule T and spouses | “Report your PA-taxable winnings on PA Schedule T. Spouses must report their winnings separately.” |
| Payers | “The payers of prizes provide the department with copies of the federal Form(s) W-2G that they submit to the IRS.” |
| Documenting Gambling and Lottery Winnings and Losses | “Taxpayers claiming gambling winnings and losses must be able to document their winnings and losses.” “You should keep an accurate diary or similar record of winnings and losses.” |
| Documentation and your return | “This documentation should not be included with your return, but may be requested at a future date by the department.” |
| PA Withholding on Gambling and Lottery Winnings | “PA personal income tax withholding is required for all Pennsylvania Lottery cash prizes greater than $5,000 paid after July 12, 2016.” “In addition, many of the casinos in Pennsylvania offer voluntary withholding of PA personal income tax.” |
| Withholding shown on a W-2G | “If you have PA tax withheld included in Box 15 of federal Form(s) W-2G, report the withholding on Line 7 of PA Schedule T.” “You must also include a copy of your federal Form(s) W-2G with your return.” |
The figures the form prints
The withholding paragraph states its dollar test in one sentence: “PA personal income tax withholding is required for all Pennsylvania Lottery cash prizes greater than $5,000 paid after July 12, 2016.”
Federal withholding boxes on the Form W-2G are covered on Form W-2G box 4 and boxes 13 to 18. The booklet points to Box 15 for the state amount, as quoted in the table above.
Where the result goes next
Line 9 picks up line 8 along with the other income classes: “Total PA Taxable Income. Add only the positive income amounts from Lines 1c, 2, 3, 4, 5, 6, 7, and 8.” Line 9 is covered on Pennsylvania Form PA-40 line 9.
The booklet adds “Submit the required Pennsylvania schedule for each amount you report on Lines 4 through 8.” For line 8 that schedule is PA Schedule T. The federal counterpart is covered on Schedule 1 lines 8a and 8b.
Edition and line numbers
This page reads 2025 PA Personal Income Tax Return Instructions (PA-40 IN), Pennsylvania Department of Revenue, and 2025 Form PA-40, Pennsylvania Income Tax Return, Pennsylvania Department of Revenue, for tax year 2025, the current files the Pennsylvania Department of Revenue served on 2026-10-24. Check the edition printed on your own form and use that edition’s line numbers.
Common mistakes
- Deducting trip or meal expenses against winnings. The booklet says “You may not deduct any expenses (programs, tip sheets, travel, meals, lodging, etc.) that you incurred to take part in gambling, wagering, betting, and lottery activities.”
- Leaving out winnings from another state. The booklet says “As a PA resident, you must also include gambling and lottery winnings from other states and countries.”
- Having no record of winnings and losses. The booklet says “Taxpayers claiming gambling winnings and losses must be able to document their winnings and losses.”
Related: Form W-2G boxes explained, Form W-2G for lottery and sweepstakes winnings, Form W-2G box 4 and boxes 13 to 18, and Schedule 1 lines 8a and 8b.
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Answer againSources
- 2025 PA Personal Income Tax Return Instructions (PA-40 IN), Pennsylvania Department of Revenue: www.pa.gov
- 2025 Form PA-40, Pennsylvania Income Tax Return, Pennsylvania Department of Revenue: www.pa.gov
- Related official page (not quoted): Pennsylvania Department of Revenue, personal income tax forms and publications: www.pa.gov
Read from the state revenue documents linked above on October 24, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the state revenue department is the right place to confirm anything consequential.