{"id":30345,"date":"2022-01-21T04:21:22","date_gmt":"2022-01-21T10:21:22","guid":{"rendered":""},"modified":"2022-01-21T04:24:33","modified_gmt":"2022-01-21T10:24:33","slug":"taxes-on-casino-winnings","status":"publish","type":"post","link":"https:\/\/www.casino.org\/blog\/taxes-on-casino-winnings\/","title":{"rendered":"Do You Have To Pay Taxes On Casino Winnings?"},"content":{"rendered":"\n

You have finally gotten those sevens to line\nup in the window of your favorite slot machine, or maybe you laid down that\nRoyal Flush on Mississippi Stud you’ve been waiting years on. <\/p>\n\n\n\n

The taxman is probably the farthest thing from\nyour mind. <\/p>\n\n\n\n

But the sad reality is, you’re going to have\nto pay taxes on a slot jackpot of $1,200 and up, and most table games jackpots\nthat are more than 300 to 1.<\/p>\n\n\n\n

Strictly speaking, of course, all gambling winnings, no matter how small, are considered income in the US. <\/p>\n\n\n\n

And the IRS<\/a> expects you to report them – whether it is $1 or $10,000 – on your 1040 tax form<\/a> as “other income”. <\/p>\n\n\n\n

But in certain situations like a slot or table games jackpot, the casino will generate a Form W-2G<\/a>, which outlines to the IRS what you’ve won and whether or not taxes were paid. <\/p>\n\n\n\n

Federal Withholding is 24 percent on a W-2G for US citizens and 30 percent for non-citizens.<\/p>\n\n\n\n

We certainly aren’t tax experts, but we can\nwalk you through the process of when casinos issue a W-2G and what you can expect.\n<\/p>\n\n\n\n

But first off, “Congratulations on your big win!”<\/p>\n\n\n\n

…which is precisely what you are likely to hear right before casino staff starts asking for ID and your Social Security Number (SSN). And in some cases, whether or not you’d like Federal Withholding tax withheld.<\/p>\n\n\n\n

When To Expect A Form W-2G<\/strong><\/h2>\n\n\n\n
\"Form<\/figure>\n\n\n\n

So in typical IRS fashion, each type of\ngambling winning has a different reporting requirement.<\/p>\n\n\n\n

Ever wonder why some casinos have slot or\nvideo poker jackpots set at $1,199? <\/p>\n\n\n\n

Well, here’s your answer.<\/p>\n\n\n\n

Slots, Video Poker And Keno<\/strong><\/h2>\n\n\n\n

All slot<\/a> and video poker<\/a> jackpots of $1,200 or more will trigger a W-2G. <\/p>\n\n\n\n

This seems to also apply to electronic keno<\/a>, though the IRS website lists the reporting requirement for live keno at $1,500.<\/p>\n\n\n\n

Table Games<\/strong><\/h2>\n\n\n\n

All table games<\/a> are considered games of skill under federal tax law. Skilled games are issued a W-2G if the payout is 300 to 1 or more AND at least $600. <\/p>\n\n\n\n

Some table games like craps<\/a>, roulette<\/a>, or blackjack<\/a> are never issued a W-2G, even if the winnings are in the millions. <\/p>\n\n\n\n

However, not receiving a W-2G does not mean you won\u2019t be liable for taxes on your winnings. <\/strong><\/p>\n\n\n\n

And all large cashouts at the cage will require an ID and an SSN or other documents, in any case, leaving a paper trail.<\/p>\n\n\n\n

Poker<\/strong><\/h2>\n\n\n\n

While cash games do not generate W-2Gs whether\nyou are a professional or amateur player, tournament wins over $5,000 will have\nthe casino or card room filling out paperwork. <\/p>\n\n\n\n

Your tourney buy-in is subtracted from that\namount. <\/p>\n\n\n\n

Many professional players treat poker as a business, even going as far as opening an LLC<\/a>. <\/p>\n\n\n\n

This allows them to write off losses against wins and deduct expenses like hotel rooms.<\/p>\n\n\n\n

Sports Betting and Horse Racing<\/strong><\/h2>\n\n\n\n

Wins on sports betting or horse racing<\/a> also have W-2Gs completed on wins of 300 to 1 or more and at least $600. <\/p>\n\n\n\n

More than 25 states have legalized sports betting since 2018, bringing in tens of millions in new tax revenue. <\/p>\n\n\n\n

And more states are passing legislation to allow sports betting every year, many with rules that allow for mobile<\/a> sports betting. <\/p>\n\n\n\n

The ability to bet on games from your phone, along with the addition of in-game betting, is likely to mean there will be a flood of new W-2Gs. <\/p>\n\n\n\n

In-game betting allows you to bet on various\noutcomes during each game, like whether the next play will be a pass or a run\nor whether the next batter will strikeout. <\/p>\n\n\n\n

These bets can then be strung together in\nparlays and teasers that often pay more than the 300 to 1 threshold.<\/p>\n\n\n\n

I\u2019m A Big Winner, Now What?<\/strong><\/h2>\n\n\n\n

Casino staff will request identification and they\u2019ll need a F<\/a>o<\/a>rm W-9<\/a> if they don’t already have one on file for you. <\/p>\n\n\n\n

A Form W-9 is an IRS tax form used to verify\nthe name, address and taxpayer identification number (TIN) of an individual receiving\nincome. It allows the casino to identify to the IRS which tax filer this\npaperwork is for. <\/p>\n\n\n\n

In cases where the payout is less than $5,000,\nthey will ask whether you want federal taxes withheld.<\/p>\n\n\n\n

If you decline to provide two forms of ID, you\nwill not be paid. However, the winnings will be held at the cage for some time\nto give you time to reconsider or be able to provide the requested documents. <\/p>\n\n\n\n

If you decline a W-9, backup withholding will\nbe withheld at a 28 percent tax rate. While Federal Withholding is 24 percent\non cash, it rises to 33 percent on prizes like cars or boats. <\/p>\n\n\n\n

In some instances, individual states will also\nwithhold taxes. Though, Nevada is not one of them.<\/p>\n\n\n\n

At tax time, you will want to tally all of\nyour W-2Gs from the year, along with other gambling winnings, and declare them.\n<\/p>\n\n\n\n

As mentioned, we are not tax professionals,\nbut one mistake we see made over and over is people not withholding federal\ntaxes on those small wins under $5K. <\/p>\n\n\n\n

Most mistakenly believe that they can use\nlosses against those winnings and not owe federal taxes, but this is only true\nif you are itemizing your taxes instead of taking the standard deduction.  <\/p>\n\n\n\n

Tax law changes in 2018 almost doubled the\nstandard deduction. The list of things you could deduct if you itemized was\ncut, so most Americans will no longer be itemizing.<\/p>\n\n\n\n

This means the IRS will have a W-2G where\nwithholding wasn’t paid, and you will have no qualifying losses. <\/p>\n\n\n\n

It\u2019s probably best to have withholding taken\nout of all jackpots unless you have spoken with a professional tax planner, or\nyou are confident you will be itemizing deductions and keeping good records of\nall gambling wins and losses.<\/p>\n\n\n\n

Conclusion<\/strong><\/h2>\n\n\n\n

There are only a few certainties in life, and\ntaxes are certainly one of them. We hope you enjoyed your big win, but the IRS\nis going to want you to share. <\/p>\n\n\n\n

Remember, the IRS expects all gambling winnings reported, not just jackpots. <\/strong><\/p>\n\n\n\n

If you do receive a W-2G, remember to include\nit on year-end taxes even if you had taxes taken out, so that the IRS can see\nthat everything matches up. <\/p>\n\n\n\n

If you have several W-2Gs or a huge win,\nconsider doing your taxes with the standard deduction and itemized deductions\nto see which turns out better. <\/p>\n\n\n\n

Or better yet, consult a tax professional.<\/p>\n","protected":false},"excerpt":{"rendered":"

You have finally gotten those sevens to line up in the window of your favorite slot machine, or maybe you …<\/p>\n","protected":false},"author":62,"featured_media":30352,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[15],"tags":[],"acf":[],"yoast_head":"\nTax On Casino Winnings \u2013 How Much Do You Have To Win To Pay Tax?<\/title>\n<meta name=\"description\" content=\"Learn about the Form W-2G and what triggers it, what games you\u2019ll pay tax on & what to expect if you win big at the casino.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/blog\/taxes-on-casino-winnings\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Do You Have To Pay Taxes On 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