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Its very frustrating and causing a lot of people anxiety because the numbers can add up quick if you are depositing and withdrawing daily basically the same $500 over and over. The funny thing is though, if you do receive a 1099-Misc from an online casino what do you do? Because you have to report that 1099-Misc but you also have to show that same money on your 1099-K. I dont know why Paypal cant differentiate when they see a deposit to "Barstool" and then a withdraw from "Barstool." seems like they should be able to determine its the same entity. I will no longer be using online gaming sites or Paypal. And this year I am filing my 1099-K under the miscellaneous showing what I withdrew and then using the negative symbol for what I deposited. winnings is a separate class of income under Pennsylvania personal income. I then amended my 2021 return to reflect what I played that year. mail toward the end of January if certain gambling winnings hit monetary thresholds. They claim I owe 8,000 plus interest and penalties when I only made 1000. I am currently in an appeals state with US Tax court. I knew this was not right and had no idea what to do. However, I got a 1099-K but saw that I had income of 23,000. Again, all the same money, deposit 500, withdraw 500 etc multiple times throughout the year. I had deposited 22,000 into online sportsbooks and withdrew 23,000. It appears the best way to do this is in the other income section. Whatever you do, make sure you put the amounts from you 1099-K onto your return. His astounding career is on full, vibrant display in the immense new box set aptly dubbed Working Our Way Back to You - The Ultimate Collection. That's not to say the 89-year-old is resting on his laurels. 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