Gambling tax calculator

Estimate your 2026 taxable gambling income and the federal tax on it, whether you played at an online casino, a sportsbook or a sweepstakes site. This is for US taxes only. Pick your state below and we'll add a state-tax estimate too, where a single flat rate makes that possible.

Nothing you enter here is sent to a server or stored. The calculation runs entirely in your browser.

How the calculation works

1. Deductible losses (2026 rule): the lesser of your losses or winnings, times 90%. Under the OBBBA, losses can only offset winnings, never create a net loss, and only 90% of that offsetting amount counts.
2. Taxable gambling income: winnings minus deductible losses. This lands above $0 once you've had any losses at all, even if your losses match your winnings exactly - that's the "phantom income" effect below.
3. Federal estimate: gambling income is taxed at your marginal rate, stacked on top of your other income, not at one flat percentage. We calculate tax on (other income + gambling income), subtract tax on (other income) alone, and the difference is the federal estimate above - using the 2026 IRS brackets for your filing status.

If any single win was $5,000 or more, or met the relevant reporting threshold below, the payer may have already withheld 24% federally. That withholding is a prepayment, not your final tax bill, and this calculator doesn't net it against the result since we don't know what was actually withheld on your specific wins.

What actually counts as a "loss"?

Here's where a lot of players get tripped up, and where the 90% cap really bites: a "loss" for tax purposes means money you wagered and didn't get back, including buy-ins to tournaments, sit-and-gos or contests that didn't pay off. It does not include travel, hotel rooms, meals or other costs of playing. For most recreational gamblers, those costs were never deductible in the first place; only the money actually lost on wagers is.

Say you play the WSOP: $100,000 in tournament buy-ins, $10,000 in flights and hotels, $200,000 in winnings. The $100,000 in buy-ins that didn't cash counts as a wagering loss. The $10,000 in travel doesn't, for a recreational player. If gambling is your full-time trade or business, the rules get more complex again - see below.

What's different for professional gamblers

This calculator's Winnings and Losses fields are built for the recreational case above. If gambling is your trade or business, not a hobby, the rules - and the paperwork - are different enough that this simple tool isn't built for your math. Here's what changes and why.

How you know you're "professional," for tax purposes

You don't get to self-declare it. The standard comes from the Supreme Court's 1987 ruling in Commissioner v. Groetzinger: gambling only counts as a trade or business if it's "pursued full time, in good faith, and with regularity, to the production of income for a livelihood," and isn't a mere hobby. The taxpayer in that case gambled 60 to 80 hours a week, at the track 6 days a week, with no other job. Courts have applied this narrowly since - simply gambling often, or even winning consistently on the side, hasn't been enough on its own in later cases.

Where you file

Professional gamblers report on Schedule C (Profit or Loss From Business) instead of Schedule 1 plus Schedule A. That means you don't have to itemize to deduct anything, unlike a recreational player.

What changed under the 2026 rules

Before 2018, a professional gambler could deduct wagering losses (capped at winnings) on Schedule C, and separately, fully deduct ordinary business expenses like travel, meals, entry fees and data subscriptions with no cap - a Tax Court case called Mayo v. Commissioner established that split. The 2017 Tax Cuts and Jobs Act closed that gap: it redefined "losses from wagering transactions" to include those business expenses too, folding everything into one bucket limited to your winnings. That 2018 change was due to expire after 2025. Instead, the OBBBA made it permanent and added the same 90% cap recreational players now face - so as of 2026, a professional's wagering losses and business expenses are combined and capped at 90% of winnings, not the fully separate, uncapped treatment pros used to get.

Self-employment tax

If your Schedule C shows a net profit for the year, that profit is subject to self-employment tax (Social Security and Medicare, under Section 1401) - something a recreational player never owes on gambling winnings. Tax Court cases involving professional gamblers have confirmed this directly: report a profit and self-employment tax applies; report a loss and it doesn't, but a loss also doesn't offset your other income.

This is general information, not a substitute for professional advice. If you think you may qualify as a professional gambler, talk to a tax professional who has handled Schedule C gambling returns before you file.

Form W-2G explained

Form W-2G is the form a casino or gaming operator issues when your winnings meet a specific threshold for that type of game. As of January 1, 2026, most of those thresholds rose to $2,000 under the OBBBA, up from figures as low as $600.

*"300:1 odds" means your payout is at least 300 times what you bet, so a $10 wager would need to pay out $3,000 or more to trigger this rule.

A higher threshold means fewer forms get issued for smaller wins. It does not change whether that income is taxable - if your win falls under the threshold and you get no W-2G, you still owe tax on it and still need to report it yourself.

Can you deduct gambling losses?

Yes, but only if you itemize deductions, only up to the amount of your winnings, and starting with 2026 tax returns, only for 90% of your losses rather than 100%.

Rep. Dina Titus's FAIR BET Act (H.R. 4304) would restore the full 100% deduction and has bipartisan support, but it's stalled in the House Ways and Means Committee; a discharge petition Titus filed in February 2026 hasn't forced a floor vote yet. As of this writing (Aug 2026), the 90% cap remains the law for 2026 returns. Check back here, since this could change before you file.

Why these 8 states aren't all in our calculator

Federal tax applies everywhere in this calculator. State tax is a different story: our calculator's state dropdown only covers the 15 states with a single flat income tax rate, since that's the one case where a one-number estimate is accurate. The 8 states below show why the rest aren't included, either because there's no state income tax to estimate, or because graduated brackets (rates that rise with income, like New York, New Jersey or California) make a single number misleading. Only Pennsylvania and Michigan on this list are actually supported in the calculator above; use the guide links for the others to find licensed options in that state.

Rates from the Tax Foundation, a nonpartisan tax policy research group, current as of early 2026. This table is a spotlight on 8 high-traffic states, not the full list - check your own state's guide on this site or your state's department of revenue for anything not shown here.

Taxes on sweepstakes and prize winnings

Sweepstakes casinos work differently from wagering, but the tax treatment of what you redeem is the same principle: it's taxable income at fair market value the moment you receive it, whether that's cash, a gift card or a physical prize. This applies to players 18 and older. If a sweepstakes operator pays out $600 or more in a year they may issue a Form 1099-MISC (now the $2,000 threshold applies here too, per the OBBBA change above), but the absence of a form doesn't mean the redemption is untaxed.

Do payment apps like PayPal report your winnings?

Only in a specific, separate sense. PayPal, Venmo and similar apps may issue a Form 1099-K, but that threshold ($20,000 and 200+ transactions federally, restored by the OBBBA) tracks total payment volume through the app, not gambling winnings specifically, and has nothing to do with W-2G or your loss deduction. See our PayPal casinos guide for the payment-specific details.

FAQ