Have no idea why your state is any different than most,follows federal guidelines on gambling winnings where losses can offset winnings but not to exceed them.

The state I live in DOES NOT allow you to deduct your gambling losses. There is no way around paying the state taxes on gambling winnings here. You need to check with your state's treasury to see if they allow you to deduct your losses and if not what the rate will be for the amount you earned.

I ended up entering a 24 month payment plan for what I owed. It was a significant amount, nearly $12,000. Fortunately I wised up and had the casino start withholding state taxes once I learned I couldn't avoid them. I am only a few months away from having that squared away.

Just typing this, I don't miss those days at all, having to worry about all this.

Yes.
You can include tax debt in your chapter 13 bankruptcy. You will want to be sure to have all tax debt included so that they will be paid on an equal basis. All creditors are to be treated equally in a bankruptcy.

Hi if you want to email me and let me know what state you live in, I would be happy to check on whether you can deduct the losses. I'm a CPA and should be able to find answer quickly (no charge). My state allows gambling losses because it starts with federal taxable income and then just makes a few adjustments. On the federal return the winnings are on page 1 gross income while the losses (only up to winnings) are an itemized deduction on Schedule A. However if you gambled so much that you can meet the test for it being an occupation, you can net them both together on schedule c. Some people even deduct net gambling losses this way but it's a hard test to meet.