Gambling in the USA

What You Need to Know About Gambling and Your 2021 Taxes

Published

3 years ago

April 7, 2022

What You Need to Know About Gambling and Your 2021 Taxes

The deadline for filing 2021 federal tax returns looms on April 18 this year and for gamblers, it’s an occasion to be reminded of how the tax code addresses their gaming activity. Generally speaking, that’s not too kindly.

The bottom line is simple and stern. As a rule, all income from gambling — including real money online casino play — must be reported eventually on Line 8 of the familiar Form 1040 (along with inclusion on Schedule 1).

To some, it may come as a surprise that gambling income is reported as a gross figure and not a net result. That stands in contrast to, say, capital gains or losses realized in stock transactions, which are reported on Line 7 of the Form 1040 (usually, along with a Schedule D).

In plain English and by example what that means is this: If a taxpayer wins $500 playing the slots in a casino on Monday and then loses $800 playing the slots on Tuesday, the taxpayer is required to report the $500 win on his Form 1040 on Line 8. The $800 loss would be accounted for on Schedule A (Itemized Deductions) — but there are caveats.

The first may be familiar to taxpayers who gamble. Reported gambling losses cannot exceed gambling wins so in the above example, the taxpayer would have an allowable deduction of just $500 for net zero result (the gamble eats the excess $300 loss). But then there’s another issue.

The taxpayer gets to account for gambling losses only if he/she itemizes deductions on Schedule A. And as a result of the 2017 tax revision, the allowance for the standard deduction was raised to a point where it doesn’t make financial sense for the vast majority of taxpayers to itemize their deductions.

What that means for many taxpayers who gamble relatively modestly is that they have no opportunity to deduct any gambling losses. So, the gaming “win” stands alone as income even if the aggregate gambling activity was a net loss.

As an aside, the standard deduction for married couples filing a joint return for tax year 2021 is $25,100. For single taxpayers and married individuals filing separately, the standard deduction is $12,550. For heads of households, the standard deduction is $18,800.

The impacts of gross gambling income on line 8 may be subtle but can be significant. For instance, that amount gets carried down to Line 11, adjusted gross income, which can affect a range of tax circumstances, such as how much of the taxpayer’s Social Security benefits are taxable.

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FUNDAMENTAL TAX RULES FOR GAMBLERS

Taxpayers who gamble should remember that all gambling winnings must be reported as income regardless of whether the operator issues documentation, such as a W-2G or a Form 1099.
Unfortunately, gamblers cannot “net” their winnings and losses when reporting gambling income. Gambling income is usually reported on Schedule 1 and then carried over to Form 1040, Line 8.
Gambling losses are accounted for on Schedule A, Itemized Deductions, and taxpayers must itemize to get the benefit of a gambling loss deduction. However, taxpayers have to choose between itemizing deductions or taking the standard deduction.
If gambling losses are taken as a deduction, they cannot exceed the amount of gambling wins.
Win or lose, taxpayers should keep a journal of their gambling activity. They should note where, when, what games were played, and how much was won or lost. Taxpayers should also keep any evidence of wagering activity, losses included.
State taxes may also be due on gambling winnings and rules vary from state to state. Gamblers should familiarize themselves with their state’s tax policies on gambling income.

OTHER THINGS TO KEEP IN MIND

The proliferation of gambling, both bricks-and-mortar and on the internet, has created complications for taxpayers that should be addressed by a tax professional but there are some things taxpayers should keep in mind.

As mentioned earlier, keeping a journal of gambling activity be part of your record-keeping.

Remember, all gambling winnings are reportable even if a gambling operator doesn’t issue paperwork, often a W-2G or a 1099-MISC or a 1099-K.

And speaking of W-2Gs, here are the occasions when the Internal Revenue Service says a W-2G should be issued by the gambling operator:

1. The winnings (not reduced by the wager) are $1,200 or more from a bingo game or slot machine;
2. The winnings (reduced by the wager) are $1,500 or more from a Keno game;
3. The winnings (reduced by the wager or buy-in) are more than $5,000 from a poker tournament;
4. The winnings (except winnings from bingo, slot machines, keno, and poker tournaments) reduced, at the option of the payer, by the wager are:
a. $600 or more, and
b. at least 300 times the amount of the wager; or
5. The winnings are subject to federal income tax withholding (either regular gambling withholding or backup withholding).

What may irritate taxpayers who gamble is how gambling activity is treated as opposed to something like day-trading stocks. In the latter case, which also involves substantial risk-taking, the stock day-trader gets to net losses against gains without having to choose between itemizing deductions and taking the standard deduction.

UNFAIRNESS TO GAMBLERS

The unfairness to taxpayers who gamble, particularly those who play at modest levels, was noted by the American Gaming Association, the trade group that represents the gambling industry, when the 2017 tax code was being revised.

“Under such a higher standard deduction, small and mid-level slot machine players may not be able to itemize their deductions, even with their gaming losses, and hence may not be able to offset gaming wins reported as income with the full amount of their gaming losses,” the AGA said in a letter to Capitol Hill.

“AGA strongly recommends, as a matter of tax simplification, that gaming players should be permitted to subtract gaming losses from gaming winnings in order to compute their taxable net gaming income for purposes of reporting adjusted gross income, without being required to itemize their deductions.”

Unfortunately for gamblers, that recommendation was not taken by the Congress.

For years, the AGA has been trying to get the threshold for issuing W-2Gs raised from $1,200 to $5,000 without any luck. However, early in March, the Congressional Gaming Caucus advanced an effort to raise the slot tax threshold to $5,000 with bipartisan legislation and also provide a mechanism for future increases based on inflation. The current $1,200 slot tax threshold has not been adjusted for inflation since 1977 and, since then, the instances of $1,200 W-2Gs has skyrocketed.

DON’T FORGET STATE TAXES

In addition to concerning themselves with federal taxes, gamblers need to deal with state income tax obligations. Some states allow deductions for losses, some do not. Some states allow for losses and wins to be netted, most do not.

Michigan, for example, changed its tax laws recently to allow for gambling loss deductions where there are winnings. Mississippi, meanwhile, has its 3% tax where the gaming establishment withholds a 3% “nonrefundable” tax at the time a W-2G-level jackpot is hit regardless of whether the winner is a state resident.

Casino customers from outside the country get separate treatment. In many cases, the United States has tax treaties with other countries that dictate how non-U.S. gamblers are treated from a tax perspective. For instance, in the United Kingdom, gambling winnings are not taxed and the U.S. tax treaty with the UK means that U.S. taxes are not withheld from those gambling customers.

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Gambling in the USA

UNLV International Gaming Institute Announces 2025 ESPN Research Fellows

Published

1 day ago

September 17, 2025

Peter Tolan

Selected research projects will generate new insights into how responsible gambling messages are delivered and perceived in the rapidly evolving sports media landscape

The University of Nevada, Las Vegas International Gaming Institute (IGI) is proud to announce the recipients of the 2025 ESPN Research Fellowships. This year’s cohort features a group of scholars whose proposals will advance understanding of responsible gambling messaging in sports media and its implications for consumer well-being.

Fellowships recipients include:

Dr. Brandon Mastromartino, Director of the Institute on Sports Wagering and Gaming and Assistant Professor of Experiential Marketing at the L. Robert Payne School of Hospitality and Tourism Management, San Diego State University. Dr. Mastromartino’s project will evaluate two of the NFL’s responsible gambling PSAs using a fan-centered marketing framework.
Dr. Chris R. Noland, Assistant Professor of Advertising at the University of South Florida’s Zimmerman School of Advertising & Mass Communications. Dr. Noland will examine the influence of celebrity endorsements and promotional inducements in Instagram advertisements on online sports betting behavior.
Dr. Ramon Silva Leite, Professor in the Postgraduate Program in Management at Pontifical Catholic University of Minas Gerais, Brazil. Dr. Silva’s project will investigate how responsible gambling messages are constructed and delivered through sports media, and how young sports bettors perceive and respond to them.
Dr. Sarah Stokowski, Associate Professor of Athletic Leadership at Clemson University’s Department of Educational and Organizational Leadership Development. Dr. Stokowski will investigate how college student-athletes perceive and interact with sports betting content on social media.

These projects will provide important insights into practical strategies that policymakers and the industry can adopt to help safeguard the wellbeing of sports enthusiasts and the public at large.

“IGI is tremendously proud of the work our previous Fellowships produced. A key goal of this initiative is to support innovative and impactful research to better understand the rapidly changing global sports and betting environment,” said Dr. Kasra Ghaharian, Director of Research at IGI. “This research represents critical perspectives on how gambling is represented in sports media and holds important implications for all gambling stakeholders.”

“Responsible gaming continues to be a priority for ESPN, and we are proud to continue our collaboration with IGI to support research that delivers real-world impact,” said Kevin Martinez, Vice President of ESPN Corporate Citizenship. “These new projects will provide valuable insights into how responsible gaming messages can be delivered effectively across sports media and help strengthen standards that protect fans everywhere.”

Each research fellowship lasts six months. Research results will be featured in an IGI webinar in 2026.

Gambling in the USA

Iconic Online Games Set for Land-Based Debut Through Collaboration of Gaming Arts and Evolution

Published

2 days ago

September 17, 2025

George Miller

Iconic Online Games Set for Land-Based Debut Through Collaboration of Gaming Arts and Evolution

Gaming Arts, LLC and Evolution, through its dedicated land-based slot games partner Bluhare Studios, announced a landmark collaboration to adapt a select group of Evolution’s most celebrated online slot titles for the land-based Class III gaming market. This partnership combines proven game mechanics, strong brand recognition, innovative features, and Gaming Arts’ suite of high-performance MOD EX cabinets to deliver products designed to meet the expectations of today’s land-based casino players.

The first wave of releases is scheduled for Q4 2025 in North America and will be available across Gaming Arts’ latest cabinet line-up: the MOD EX J55, MOD EX 227, and MOD EX 337. Four titles will lead the launch, each carrying a strong legacy in online gaming along with exciting new enhancements for the casino floor.

Divine Fortune has been a global standout since its debut, ranking as the number one title for Evolution in the United States. Performing well in New Jersey, Pennsylvania, Michigan, and in all states it can be found online. It’s no surprise it has inspired successful online sequels such as Divine Fortune Megaways and Divine Fortune Black. Now, this player favorite will make its long-awaited land-based debut. Developed in collaboration with Gaming Arts, Divine Fortune Ascensionbuilds on the success of the original with a fresh twist, introducing an all-new three-pot perceived persistence feature designed to heighten engagement.

Starburst, released in 2012, is one of the most recognizable slot titles in online gaming history and Evolution’s top performer globally. With its simple yet captivating gameplay, it has remained a staple for over a decade, inspiring sequels such as Starburst XXXtreme and Starburst Galaxy. Starburst Supernovareimagines this classic with a multiplayer-enabled format, launching as part of a two-game multi-pack. Both titles will feature a new perceived persistent bonus mechanic that culminates in a hold-and-spin feature, adding a fresh layer of excitement to an already proven brand.

This collaboration also creates new opportunities for integrated marketing campaigns across both online and land-based platforms, reinforcing brand engagement and building stronger connections with players.

“We are thrilled to be working with the Evolution team, which has long been an industry leader in creating compelling content for online gambling markets. This partnership allows us to work with two of Evolution’s most celebrated titles and bring them to a brand new player base”, said Greg Colella, Chief Product Officer, Gaming Arts.

“Bringing these iconic titles to land-based casinos represents a major step forward for Gaming Arts,” said Rob Ziems, CEO of Gaming Arts. “This collaboration goes beyond simply combining Evolution’s exceptional game brands with our latest MOD EX hardware. We are working closely with Evolution to effectively adapt these classics for land-based play while also innovating and modernizing them to create fresh, engaging experiences that will truly resonate with today’s casino players.”

Todd Haushalter, Chief Product Officer at Evolution, said: “Since the beginning of online gaming, content has traditionally flowed in one direction; from land-based casinos to online. That approach made sense, as it brought proven experiences to digital audiences. What excites us now is reversing that trend by taking some of the most successful games in the history of online gaming and bringing them to land-based casinos. Evolution is thrilled to be at the forefront of this shift. This collaboration allows us to bring our world-class IP to the incredibly talented team at Gaming Arts, and watching them work their land-based magic to adapt and reimagine our games has been truly inspiring.”

Gambling in the USA

TCSJOHNHUXLEY to Sponsor Inaugural G2E Dealer Championship

Published

1 week ago

September 11, 2025

Peter Tolan

G2E Las Vegas 2025 is set to host the first-ever US Dealer Championship, and TCSJOHNHUXLEY is delighted to announce its sponsorship of this landmark event. The championship, which celebrates the skill and professionalism of casino dealers, will take place at The Venetian Expo from October 7-9, 2025.

The G2E Dealer Championship will bring together the nation’s top casino dealers to compete for the title of “Best Dealer.” Contestants will be judged on their technical precision, game knowledge, and ability to provide a superior player experience.

As a proud sponsor TCSJOHNHUXLEY will be supplying all the Roulette tables for the competition, ensuring the highest standard of equipment for the championship. This not only highlights the company’s commitment to the dealers but also provides the perfect platform to showcase its renowned manufacturing expertise. TCSJOHNHUXLEY’s world-class Roulette tables are testament to the precision engineering and superior craftsmanship that has set the industry standard for decades.

Phil Lee, TCSJOHNHUXLEY Chief Financial Officer & Managing Director Americas comments, “We are delighted to be a part of the first G2E Dealer Championship, an event that truly celebrates the invaluable role of casino dealers. Dealers are the heart of the live gaming experience, and we are committed to supporting their success. Our outstanding Roulette tables will provide the perfect platform for these talented professionals to showcase their artistry and skill.”

The G2E Dealer Championship will take place at Booth #5225, located in The Strip at G2E.

The sponsorship underscores TCSJOHNHUXLEY’s unwavering commitment to the live gaming sector and the professionals who drive its success. The company invites all attendees to witness the championship and visit its stand at Booth #4439 during the expo to see its full range of innovative solutions.