Ultimately, there are two different taxes to think about when it comes to gambling winnings. First, there may be federal taxes subject to a 24% flat rate. The following table provides the winning threshold where the gambling operator or casinos supplies a Form W-2G.
| Federal Gambling Tax | |
|---|---|
| $600 | 300x Wager |
| $1,200 | Slots or Bingo |
| $1,500 | Keno |
| $5,000+ | Poker Tournaments (after buy-in) |
| $5,000+ | Sweepstakes, Pools and Lotteries |
| Miscellaneous | Any other gaming subject to withholding |
Also, depending on your state, you may be subject to state taxes. However, there are some states where you do not pay taxes on gambling.
| States Without Gambling Income Tax | ||
|---|---|---|
| Alaska | California | Florida |
| Hawaii | Nevada | New Hampshire |
| South Dakota | Tennessee | Texas |
| Utah | Washington | Wyoming |
For other states that require an additional state income tax on your gambling winnings, this amount is subject to each state’s laws. For example, each state sets its own regulations regarding lottery or sports betting if available. Moreover, even if you win out-of-state, you may still need to pay taxes on those winnings in that state. Most importantly, be sure to check your W-2G and check with a financial accountant on any potential tax obligations.
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