Calculate Your Sports Betting Tax
Calculate your federal and state taxes on sports betting and gambling winnings. Updated for 2026 with the OBBBA 90% loss deduction cap, new $2,000 W-2G threshold, and phantom income calculations.
2026 rules: 90% loss deduction cap applies (OBBBA)
Your salary, wages, and other non-gambling income
Losses can only be deducted if you itemize deductions
You cannot deduct gambling losses with the standard deduction. Switch to itemized to deduct losses.
Tax Breakdown
W-2G Form: Likely Required
Your total winnings of $10,000 exceed the $2,000 W-2G threshold for 2026. Individual wins that also meet the 300:1 odds requirement may trigger a W-2G form. Use our W-2G Checker for precise results.
Federal Withholding
$2,400 (24%) would be withheld at the time of payout. You may be due a refund of $1,200.
How Sports Betting Taxes Work in 2026
Sports betting winnings are taxed as ordinary income by the IRS. This means your winnings are added to all your other income and taxed at your marginal federal rate (10-37%), plus your state's income tax rate. The federal withholding rate is 24% on winnings over $5,000.
What Is the OBBBA 90% Loss Deduction Cap?
The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, introduced a 90% cap on gambling loss deductions starting January 1, 2026. Previously, you could deduct 100% of your gambling losses up to your winnings. Now, you can only deduct 90%, creating taxable "phantom income" even if you break even.
Can I Deduct Gambling Losses?
Yes, but only if you itemize deductions (not the standard deduction) and only up to the amount of your winnings. Starting in 2026, you can only deduct 90% of losses due to the OBBBA cap. Some states (Indiana, Massachusetts, North Carolina, Wisconsin) do not allow gambling loss deductions at the state level regardless of federal rules.