Gambling taxes guide for US players

Gambling taxes guide: the basics for US players

Every dollar you win gambling counts as income for federal tax purposes. That's true at a state-licensed casino, a lottery counter or an offshore site. The casino may or may not send you a form, but the obligation to report sits with you.

Three ideas cover most of what you need: what counts as gambling income, when a payer reports it on Form W-2G, and how losses can be deducted. This guide works through each with dollar examples, then covers records, filing and common mistakes. It's part of our guides hub; for the legal detail, see gambling taxes in our law section.

This is general information, not tax advice. Tax rules change and personal situations differ, so check IRS guidance or a qualified tax professional before you file.

What counts as taxable gambling income

The IRS treats winnings broadly. The Form W-2G instructions cover bingo, keno, slots, poker tournaments, sports and other wagering, sweepstakes, lotteries and pools. If you won money or a prize by staking something of value, assume it's reportable.

• Slot and video poker wins at any casino, online or retail.
• Table game wins such as blackjack, roulette or craps.
• Poker tournament prizes, net of the buy-in.
• Sports bets and horse racing wins.
• Lottery prizes and sweepstakes prizes.

Sweepstakes casinos describe Sweeps Coins prizes differently from casino winnings, but the W-2G instructions list sweepstakes among the categories a payer may report. See sweepstakes vs real money casinos for how those sites work.

Form W-2G thresholds for 2026

A W-2G is an information return a payer files when certain winnings cross a threshold. For payments made in 2026, the minimum reporting threshold is $2,000, and it's set to be adjusted for inflation in years after 2025. Each category applies the threshold a little differently, according to the IRS instructions for Forms W-2G and 5754 (opens in a new tab).

Example: a $2,500 slot win on a $1 spin in 2026 meets the $2,000 threshold, so a payer that issues W-2Gs would report it. No regular withholding applies to slots. If you didn't give the payer a correct taxpayer identification number, 24% backup withholding could apply: $600 on $2,500. Our W-2G form explainer and what is a W-2G go further.

Withholding on gambling winnings

Withholding is tax taken off before you're paid. Two kinds can apply to gambling, and both are 24%.

Example: a $10 wager that returns $6,010 in total leaves $6,000 won after the wager. That's more than 300 times the $10 stake and more than $5,000, so regular withholding at 24% applies: $1,440 is held back and the payer reports it on the W-2G. You claim that $1,440 as tax already paid when you file.

Withholding isn't the final bill. Your actual tax depends on your total income, deductions and bracket, so you may owe more or get some back. Our big win taxes guide covers planning around a large payout.

Deducting gambling losses and the reported 90% cap

Gambling losses can reduce the tax on your winnings, but only within limits. The long-standing rule is that wagering losses are deductible only to the extent of wagering gains for the year. You can't use a losing year to cut tax on your salary.

A 2025 federal tax law, the One Big Beautiful Bill Act (H.R. 1, section 70114, amending Internal Revenue Code § 165(d)), is reported to change this from the 2026 tax year. For taxable years beginning after December 31, 2025, the deduction for wagering losses equals 90% of those losses, and is still allowed only up to your wagering gains. "Losses" here include related expenses of wagering. An IRS proposed rule published in the Federal Register on April 17, 2026 (opens in a new tab) describes the same 90% limit.

In plain terms, losses no longer fully offset winnings of the same size. Treat this as reported and check current IRS guidance before you file, because the rule could change. Representative Dina Titus offered a House amendment to restore the 100% deduction (opens in a new tab); whether it has been enacted isn't confirmed.

The loss deduction has its own filing rules. Check IRS guidance or a tax professional on how to claim it, including whether you need to itemize. Our gambling loss deduction page and can I deduct gambling losses explain more.

Gambling tax changes: a short timeline

Taxes on offshore casino winnings

Winnings from offshore casinos are taxable like any other gambling income. What's less clear is paperwork: none of our partners' published terms say whether they issue W-2G forms, so don't count on receiving one. If no form arrives, you still report the income.

Offshore casinos also aren't licensed by any US state, and the Michigan Gaming Control Board has called several of them illegal offshore operators, including Slot Madness and Miami Club in its August 14, 2025 release (opens in a new tab) and SlotoCash on October 8, 2026. That doesn't change your federal tax obligation, but it does mean no US regulator stands behind your balance. See do offshore casinos report to the IRS and offshore casinos legality.

If a casino pays you in Bitcoin or another coin, ask a tax professional how to value the payout and any later change in the coin's price. Your own records of the dollar value on the day you received it will help.

Keeping records for gambling taxes

Good records are what let you claim losses and back up your figures if the IRS asks. Build the habit from your first session:

1. Keep a simple log for every session: date, casino or venue, game, amount staked, amount won or lost.
2. Download your casino transaction history each month, since offshore accounts can be closed or go dormant. SlotoCash, for example, voids balances after 12 months without a login.
3. Keep bank, card and crypto statements that show deposits and withdrawals.
4. Save every W-2G and any withholding statements.
5. Store everything in one folder, with a backup, and keep it for several years.

Our keeping gambling records guide has a template and tips for online play.

How to report gambling winnings when you file

When tax season comes, work through these steps in order:

1. Add up all gambling winnings for the year from your log, W-2Gs and casino records.
2. Total any federal tax withheld, shown on your W-2G forms.
3. Report the winnings as income on your federal return.
4. If you're claiming losses, total them from your records and apply the rules for that tax year, including the reported 90% limit from 2026.
5. Claim the withholding as tax already paid.
6. Check your state's rules and file a state return if required.
7. Keep copies of the return and every supporting record.

If the numbers are large or your records are messy, a tax professional is worth the cost. For what to do in the days after a big payout, see what to do after a big win.

State taxes on gambling winnings

States set their own income tax rules, and treatment of gambling winnings and losses varies. Some states have no income tax at all; others tax winnings like other income. We don't cover each state's tax rules here, so check your state revenue department's guidance.

The legal status of online casinos also varies by state. Only New Jersey, Pennsylvania, Michigan, West Virginia, Delaware, Connecticut and Rhode Island license real-money online casinos. Our state-by-state guide and states hub explain what your state says.

Common gambling tax mistakes to avoid

• Reporting only W-2G wins. All winnings are income, not just those that crossed a threshold.
• Netting wins and losses into one figure. Winnings and losses are handled separately, and losses are capped.
• Assuming last year's rules. The reported 90% limit and the $2,000 threshold apply from 2026.
• Having no records. Without a log and statements, claiming losses is hard to support.
• Treating withholding as the final bill. Withholding is a prepayment, not your actual tax.
• Gambling to cover a tax bill. The house edge makes that likely to deepen the hole. Our house edge explainer shows why.

If gambling is affecting your finances, help is free and confidential: call or text 1-800-MY-RESET (1-800-697-3738), or read gambling and money.

Partner casino offers via our links, and what they mean at tax time

No partner offers tax reporting, tax documents or tax tools in its published terms, so none of them fits this topic better than the others. We show three partners here, and any winnings from them are taxable like any other. They're offshore casinos that no US state licenses or regulates; check your state's law before you sign up, and keep records from day one. We earn a commission from these links, and the order is commercial.

Slot Madness Casino: $2,500 Welcome Bonus + 50 Free Spins, via our link (new players, 21+ or 18+ where allowed, terms apply). Third-party reviewers list a different public offer, 275% up to $2,750 with code MAD275, a $30 minimum, 30x bonus plus deposit on slots and no max cashout. Those figures differ from our link's headline, so the terms shown at sign-up apply.

SlotoCash Casino: $6,000 Welcome Bonus + 60 Free Spins, via our link (new players, 21+ or 18+ where allowed, terms apply). Its own welcome terms advertise $7,777 + 300 spins over five deposits at 25x deposit plus bonus, $20 minimum per bonus and no max cashout (primary).

Decode Casino: $5,000 Welcome Bonus + 50 Free Spins, via our link (new players, 21+ or 18+ where allowed, terms apply). Decode's site shows a "$111 Free Chip + Crypto Bonus" headline without visible terms; third-party reviewers list codes such as EASY25CODE (400%, 35x, $25 minimum, no max cashout), and codes change.

All three offers are slot-focused, with table games often excluded or weighted lower. Wagering keeps money in play against the house edge, so losses are the likely result. Read the full reviews of Slot Madness, SlotoCash and Decode before depositing.

21+ (18+ where allowed). Every casino game has a built-in house edge, so over time you should expect to lose what you stake. Set a budget before you play and stop when it’s gone: responsible gambling tools and free help. Gambling problem? Call or text 1-800-MY-RESET (1-800-697-3738).