Texas Sports Betting Tax Calculator
Texas has no state income tax, which means sports betting winnings are only subject to federal taxes. This makes Texas one of the nine most tax-friendly states for gamblers. Sports betting is not yet legalized in Texas, though residents who gamble in other states or online still owe federal taxes on winnings.
Calculate Your Texas Sports Betting Tax
2026 rules: 90% loss deduction cap applies (OBBBA)
Your salary, wages, and other non-gambling income
Texas has no state income tax on gambling winnings
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.
Texas Gambling Tax Key Facts
- ✓State income tax: 0% (no state income tax)
- ✓Sports betting: not yet legalized
- ✓Does NOT allow gambling loss deductions at the state level
- ✓No state income tax
How Sports Betting Taxes Work in Texas
Texas does not levy a state income tax, so gambling winnings are not taxed at the state level. You will still owe federal income tax on all gambling winnings at your marginal rate (10-37%), and the IRS withholds 24% on winnings over $5,000.
Under the 2026 OBBBA (One Big Beautiful Bill Act), the federal gambling loss deduction is capped at 90%. Even though Texas has no state tax, this federal cap still affects your federal tax liability.
Texas Tax Example
A single filer in Texas earning $60,000 with $10,000 in sports betting winnings and no losses
How Texas Compares to Neighboring States
Recent Texas Gambling Tax Changes
No state income tax. Sports betting not legalized despite being the second most populous state. Major legislative efforts ongoing.
Texas Sports Betting Tax FAQ
How much tax do I pay on sports betting winnings in Texas?
Texas has no state income tax, so you only pay federal taxes on gambling winnings. Federal tax ranges from 10-37% depending on your total income. The IRS withholds 24% on winnings over $5,000.
Is sports betting legal in Texas?
Sports betting is not currently legal in Texas. However, residents who gamble in other states or at legal casinos still must report and pay taxes on their winnings.
Can I deduct gambling losses in Texas?
Texas has no state income tax, so state-level loss deductions are not applicable. You can deduct losses on your federal return if you itemize, subject to the 2026 OBBBA 90% cap.
Texas Tax Authority
For official tax guidance specific to Texas, contact the state tax authority:
https://comptroller.texas.gov/↗Calculate Your Texas Sports Betting Taxes
Use our free calculator above to see exactly what you owe in Texas.
Full Tax Calculator