Buying losing lottery tickets to claim on your taxes - legal or illegal?

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Don't trash that losing ticket because it is tax deductible. (Source: 3TV/CBS 5) Don't trash that losing ticket because it is tax deductible. (Source: 3TV/CBS 5)
So some people are actually willing to risk it all buying other people's losing tickets on eBay to get the write-off. (Source: 3TV/CBS 5) So some people are actually willing to risk it all buying other people's losing tickets on eBay to get the write-off. (Source: 3TV/CBS 5)
Losing lottery tickets don't belong in the trash. (Source: 3TV/CBS 5) Losing lottery tickets don't belong in the trash. (Source: 3TV/CBS 5)
PHOENIX (3TV/CBS 5) -

Plenty of people play.

"This is it, this is my retirement," said Eric Worrall.

But not everyone wins and those losing tickets usually wind up in the trash.

"When I figure out it's not the winning numbers, then I recycle them," said Worrall.

Don't trash that losing ticket because it is tax-deductible.

“You can only write off losses to the extent that you have winnings," said Aaron Blau.

In other words, if you spent two bucks on a ticket that wins you $500, you have to pay taxes.

But if you spent $500 on tickets and you win $500, you break even and then pay no taxes.

So some people are actually willing to risk it all buying other people's losing tickets on eBay to get the write-off.

"No receipt with payment then yes, definitely at risk for having it disallowed,” said Blau.

Now you are betting Uncle Sam won't check.

Although selling the tickets on eBay isn't illegal the seller has to remember one thing.

"Any money that you make from the sale of those tickets that is also going to be taxable," said Blau. 

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Ashlee DeMartinoAshlee DeMartino is excited to finally be back in her hometown of Phoenix.

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Ashlee DeMartino
Weekend Weather Anchor

An award-winning journalist, Ashlee has worn many hats in her career, one-woman-band, executive producer, anchor, reporter and morning traffic reporter. However, her main focus and passion is weather.

As a Weather Anchor Ashlee has seen the power and destruction of mother-nature up close and personal, reporting on ravaging wildfires, devastating floods, 100 car pile ups in the fog and the rare snow and ice storm on the Las Vegas Strip.

Ashlee graduated from Arizona State University’s Walter Cronkite School of Journalism and is currently enrolled at Mississippi State University in the Geosciences program finishing her degree in Meteorology.

Fun Facts About Ashlee

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