Online gambling taxes are an important part of real money gambling. It is important to understand how your winnings are taxed in the United States. Yes, true online casino games are a hobby for most US players but it can also be a huge money-making venture. And where there is money the IRS is bound to be there. Make sure you pay your online gambling taxes as you should to avoid clashes with the law. Do you know whether you have to pay the taxes on your online casino winnings yourself or if the casino deducts the tax beforehand for you?
Find out in our guide to understanding online gambling taxes in the USA. We will also list some of the different states tax laws of online casino winnings. While you are here you can check out some of the top online casinos in the USA for a chance to win real money playing casino games.
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Online Gambling Taxes on Casino Winnings
Taxes on online gambling winnings have to be paid regardless of whether you get tax forms or not at the casino. It is your responsibility as the player to pay your taxes on the real money gambling wins you get at any of the top casinos we recommend. Depending on which state you’re in, the amount of tax you will have to pay depends on how much you win at the casino as well. Not only are gambling taxes dependent on the state as well they also vary slightly in percentage amounts from city to city in that State.
Ohio Online Gambling Taxes
In Ohio the casinos deduct 4% of whatever you win which they pay to the government in taxes. The minimum taxable amount is $600 in winning. When you get your winnings there is a tax form you receive from the casino where you can record and declare your winnings and losses. There is an additional tax which you as the player are responsible for with the winnings you keep. This tax starts from 2% in Cleveland to 2.5 % in Columbus. Cincinnati and Toledo have a 2.1% and 2.5% tax each.
Illinois Online Gambling Taxes
The state of Illinois has some of the highest online gambling taxes. Riverboat casinos in the state get charged $ for each player per casino. The players themselves are expected to pay a flat tax of 25% sometimes it may go up to 28% tax. Whether you get a W2-G tax form from the casino or not it is your responsibility to pay taxes on your winnings. There is a provision to deduct your losses from your gambling income. However, you can only deduct maximum 2% of the total winnings.
New Jersey Online Gambling taxes
New Jersey online gambling tax laws for lottery winnings only start at amounts above $10,000. The tax on lottery winnings in New Jersey is annual. However, that is not to say that the amount taxed is the overall amount. The tax applies to single wins. So even if a player were to accumulate winnings that amount to more than $10,000 at the end of the year, if each win was less than $10k it would not be taxes.
NJ Taxable Amounts
- 5% tax due on wins between $10,001 and $500,000;
- 8% tax due on wins over $500,000
- In the event that the player doesn’t have a valid tax payer number they will pay 8 tax even for wins; less than $500,000 and more than $10,000.
- Remember that you can claim your losses from your tax amount.
Nevada Online Gambling Taxes
The gambling mecca, Las Vegas in Nevada has some of the highest online gambling taxes.
Amounts higher than $5,000 get a 25% flat tax regardless of the amount you win. If a valid tax payer id number is not provided then you are subject to a 28% tax. Winning amounts which are to be reported to the IRS vary depending on the game. Casinos in Nevada are expected to report winnings over $1,200; $1,500 and $5,000 for bingo, keno and poker respectively. When you bet at the tracks winnings that are either $600 + or 300x more than what you wagered must be reported. You also have provision to claim your losses back on your tax forms.