Sports Betting Tax Calculator: Estimate Your Tax Liability

Every dollar you win from sports betting is taxable income in the United States. Whether you hit a longshot parlay or ground out profits over an entire NFL season, the IRS expects you to report those winnings on your tax return. The problem is that most bettors have no idea how much they actually owe until April.

Our free sports betting tax calculator solves that problem. Enter your winnings, losses, income, filing status, and state to get an instant estimate of your federal and state tax liability. You can even compare 2025 rules against the new 2026 OBBBA rules that cap gambling loss deductions at 90 percent.

For a complete overview of how gambling taxes work, read our sports betting taxes guide. This page focuses specifically on the calculator tool and how to use it to plan ahead for tax season.

Important: This calculator provides rough estimates only and does not constitute tax, legal, or financial advice. Tax laws are complex and change frequently. Always consult a qualified tax professional or CPA for advice specific to your situation before filing your taxes.

Free Sports Betting Tax Calculator

Use the OddsIndex sports betting tax calculator below to estimate how much you owe on your gambling winnings. The tool calculates both federal and state taxes based on your income bracket, filing status, and state of residence.

What the calculator shows you:

• Total Estimated Tax: Combined federal and state tax on your gambling income
• Effective Tax Rate: The actual percentage of your winnings that goes to taxes
• Federal Tax Breakdown: Marginal federal tax attributable to your gambling income
• State Tax: Your state's tax on gambling winnings, including whether your state allows loss deductions
• Phantom Income Warning: Under 2026 OBBBA rules, shows income you cannot offset with losses

Enter your information below, then review the results panel for a detailed breakdown. Use the tax year toggle to compare how the new OBBBA rules affect your bill. You can also use the standalone tax calculator for a full-screen experience.

How to Use the Sports Betting Tax Calculator Step by Step

Getting an accurate tax estimate takes less than a minute. Follow these steps to make the most of the calculator.

Step 1: Select Your Tax Year

Start by choosing which tax rules to apply. The calculator offers two options:

• 2025 Rules: Current tax law allows you to deduct 100 percent of your gambling losses against your winnings (if you itemize deductions).
• 2026+ OBBBA Rules: The One Big Beautiful Bill Act caps gambling loss deductions at 90 percent of your winnings. This creates a concept called phantom income, where you can owe taxes on money you never actually profited.

Switching between tax years lets you see exactly how the OBBBA changes your tax bill. This is especially useful for bettors who regularly offset winnings with losses.

Step 2: Enter Your Personal Information

Fill in your annual non-gambling income, filing status, and state of residence.

Annual Income (non-gambling): This is your salary, wages, business income, and other non-gambling earnings. The calculator uses this to determine which federal tax bracket your gambling income falls into. Higher earners pay a higher marginal rate on their gambling winnings because gambling income stacks on top of your other income.

Filing Status: Choose from Single, Married Filing Jointly, Married Filing Separately, or Head of Household. Your filing status determines which tax bracket schedule applies and your standard deduction amount.

State of Residence: Select your state to include state income tax in the estimate. Nine states have no income tax at all (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming), meaning you only pay federal tax. Other states range from 2.25 percent (North Dakota) to 13.3 percent (California). For a full breakdown of how each state handles gambling taxes, see our state taxes on sports betting guide.

Itemize Deductions: Select whether you itemize your tax deductions or take the standard deduction. You must itemize to claim gambling loss deductions. If you take the standard deduction, your full gambling winnings are taxed with no offset for losses.

Step 3: Enter Your Gambling Activity

Input your total gambling winnings and total gambling losses for the tax year.

Total Gambling Winnings: Enter your gross winnings from all sportsbooks and gambling activities combined. This includes every winning bet, bonus bet cashout, and promotional payout. Do not subtract your losses here. The IRS requires you to report gross winnings, not net profit.

Total Gambling Losses: Enter your total losses across all platforms. If you itemize deductions, these losses reduce your taxable gambling income. Under current 2025 rules, you can deduct losses up to the full amount of your winnings. Under 2026 OBBBA rules, you can only deduct up to 90 percent of your winnings. Learn more about how loss deductions work in our gambling loss deduction guide.

Step 4: Review Your Results

The results panel updates automatically as you enter your information. Here is what each output means:

• Total Estimated Tax: The combined federal and state tax you owe on your gambling income alone. This is not your total tax bill for the year. It is the additional tax attributable to your gambling activity.
• Effective Rate on Winnings: The percentage of your gross gambling winnings that goes to taxes. This accounts for loss deductions and tells you the true cost of taxes on your betting activity.
• Federal Marginal Rate: The tax bracket your gambling income falls into. Because gambling income stacks on top of your regular income, this can be higher than you expect.
• State Rate: Your state's tax rate on gambling income. Some states do not allow loss deductions, meaning they tax your gross winnings even if you had offsetting losses.
• Phantom Income (OBBBA only): If you selected 2026 rules and itemize deductions, this shows the portion of your losses that cannot be deducted due to the 90 percent cap.

Understanding Federal Taxes on Sports Betting Winnings

All gambling winnings are considered ordinary income by the IRS. They are taxed at your regular federal income tax rate, not at a special capital gains rate. This means your gambling winnings stack on top of your salary and other income, and the tax is calculated based on whichever bracket that total pushes you into.

Federal income tax rates for 2025 range from 10 percent to 37 percent. Most recreational bettors fall into the 22 percent or 24 percent bracket when their gambling income is added to their regular earnings.

2025 Federal Tax Brackets (Single Filer)

Taxable Income	Tax Rate
$0 - $11,600	10%
$11,601 - $47,150	12%
$47,151 - $100,525	22%
$100,526 - $191,950	24%
$191,951 - $243,725	32%
$243,726 - $609,350	35%
$609,351+	37%

For a detailed explanation of how these brackets apply to your gambling winnings, including marginal versus effective rate calculations, see our sports betting tax rate guide.

Key points about federal gambling taxes:

• Gambling winnings are reported on Schedule 1 (Line 8b) of your Form 1040
• You owe taxes on all winnings regardless of whether you receive a W-2G form
• Losses are deductible on Schedule A only if you itemize
• You cannot deduct more in losses than you report in winnings
• Sportsbooks may withhold 24 percent on wins over $5,000 at certain odds thresholds, but this is a prepayment, not your actual tax rate

State-by-State Taxes on Sports Betting

In addition to federal taxes, most states impose their own income tax on gambling winnings. The combined burden of federal and state taxes can take a significant portion of your winnings.

States with no income tax on gambling winnings:

Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming do not charge state income tax. If you live in one of these states, you only pay federal tax on your gambling income.

High-tax states for sports bettors:

State	Top Marginal Rate	Allows Loss Deduction
California	13.3%	Yes
Hawaii	11.0%	Yes
New York	10.9%	Yes
New Jersey	10.75%	Yes
Washington D.C.	10.5%	Yes
Oregon	9.9%	Yes
Minnesota	9.85%	Yes

Important note about loss deductions at the state level: Most states follow federal rules and allow you to deduct gambling losses if you itemize. However, a few states, including Indiana, Massachusetts, and Wisconsin, do not allow gambling loss deductions at all. In these states, you pay state tax on your gross winnings even if you lost more than you won. The calculator accounts for this automatically.

For a complete state-by-state breakdown with local tax considerations, read our state taxes on sports betting guide.

How Deductions Affect Your Tax Bill

The ability to deduct gambling losses can dramatically reduce your tax liability. However, there are strict rules around when and how you can claim these deductions.

Current rules (2025):

• You must itemize deductions on Schedule A to claim gambling losses
• You can deduct losses up to the amount of your reported winnings
• You cannot use gambling losses to reduce other income (salary, investments, etc.)
• You need documentation: betting records, sportsbook statements, and a log of wins and losses

OBBBA rules (2026 and beyond):

Starting in 2026, the One Big Beautiful Bill Act introduces a 90 percent cap on gambling loss deductions. This means if you won $10,000 and lost $10,000, you can only deduct $9,000 in losses instead of the full $10,000. The remaining $1,000 becomes phantom income, taxed even though you did not actually profit.

This change disproportionately affects bettors who break even or lose slightly. A bettor with $10,000 in winnings and $10,000 in losses previously owed zero additional tax on gambling income (if itemizing). Under OBBBA, that same bettor owes tax on $1,000 of phantom income.

Use the calculator above to toggle between 2025 and 2026 rules and see exactly how the OBBBA cap changes your estimated bill.

For a detailed guide on loss deductions, including recordkeeping requirements and what qualifies as a deductible loss, see our gambling loss tax guide.

Common Tax Scenarios for Sports Bettors

The calculator handles any combination of inputs, but here are three typical scenarios to illustrate how the math works.

Scenario 1: Recreational Bettor with $5,000 in Winnings

Input	Value
Regular Income	$60,000
Filing Status	Single
State	Texas (no state tax)
Gambling Winnings	$5,000
Gambling Losses	$3,000
Itemize Deductions	No (standard deduction)

Result: Because this bettor takes the standard deduction, the full $5,000 in winnings is taxable. At a 22 percent marginal rate, the additional federal tax is approximately $1,100. No state tax applies in Texas. Even though this bettor had $3,000 in losses, those losses provide no tax benefit without itemizing.

Scenario 2: Active Bettor in a High-Tax State

Input	Value
Regular Income	$85,000
Filing Status	Single
State	New Jersey (10.75%)
Gambling Winnings	$15,000
Gambling Losses	$12,000
Itemize Deductions	Yes

Result: This bettor itemizes, so losses offset winnings. Net taxable gambling income is $3,000 ($15,000 minus $12,000). Federal tax at the 22 percent bracket adds approximately $660. New Jersey state tax on the net amount adds approximately $323. Total estimated tax: roughly $983 on $15,000 in gross winnings.

Scenario 3: Break-Even Bettor Under OBBBA Rules (2026)

Input	Value
Regular Income	$75,000
Filing Status	Single
State	New York (10.9%)
Gambling Winnings	$20,000
Gambling Losses	$20,000
Itemize Deductions	Yes
Tax Year	2026 (OBBBA)

Result: Under 2025 rules, this bettor would owe zero additional tax because losses fully offset winnings. Under the 2026 OBBBA rules, only 90 percent of winnings ($18,000) can be offset by losses. That leaves $2,000 in phantom income. Federal tax on $2,000 at the 22 percent bracket is approximately $440. New York state tax adds approximately $218. Total estimated tax: roughly $658 on zero actual profit.

This phantom income scenario is the most important reason to use the calculator with the 2026 toggle. It reveals tax liability that many bettors will not see coming.

When You Need to Report: W-2G and Tax Thresholds

Sportsbooks issue Form W-2G for certain large payouts. However, the reporting threshold for a W-2G does not change your tax obligation. You owe taxes on all winnings regardless of whether you receive a W-2G.

When sportsbooks typically issue W-2G:

• Winnings of $600 or more when the payout is at least 300 times the wager
• Some sportsbooks withhold 24 percent federal tax on these payouts automatically

When you owe taxes but may not receive a W-2G:

• Any net winning session, even if the amount is small
• Accumulation of small wins across multiple sportsbooks
• Bonus bet conversions and promotional winnings

The IRS requires you to report all gambling income on your tax return regardless of the amount. If you use multiple sportsbooks, you need to aggregate your winnings from all platforms when filing. For step-by-step instructions on how to report your winnings, including which forms to use and where each number goes, read our guide to reporting sports betting on your tax return.

Tips to Reduce Your Sports Betting Tax Burden

You cannot avoid paying taxes on legitimate gambling winnings, but you can take steps to minimize your bill and avoid surprises.

Keep detailed records of every bet. The single most important thing you can do is maintain a log of all wagers placed, outcomes, dates, and amounts. Your sportsbook account history is a good starting point, but a personal spreadsheet adds an extra layer of protection. Good records make it easier to claim loss deductions and defend your return if the IRS has questions.

Track losses as carefully as wins. Many bettors remember their wins but forget to document losses. If you want to deduct losses, you need proof. Download year-end statements from every sportsbook you use.

Understand when itemizing makes sense. Gambling loss deductions only apply when you itemize on Schedule A. If your total itemized deductions (gambling losses plus mortgage interest, charitable donations, state and local taxes, etc.) do not exceed the standard deduction ($14,600 for single filers in 2025), itemizing does not help you. Run the calculator with both options to see the difference.

Plan ahead for OBBBA. If you are a regular bettor, start preparing for the 90 percent loss cap. Consider adjusting your betting volume or setting aside additional funds for taxes starting in 2026.

Consider the professional gambler question. If you bet at high volume and can demonstrate that gambling is a trade or business rather than a hobby, different tax rules may apply. Professional gamblers can deduct business expenses and are not subject to the same loss limitation rules. However, they pay self-employment tax. This is a complex area that requires professional guidance. Read more in our professional gambler vs casual bettor guide.

Work with a tax professional. For any bettor with more than a few thousand dollars in annual gambling activity, consulting a CPA who understands gambling tax rules is money well spent. They can help you structure your deductions, plan for estimated payments, and avoid costly mistakes.

Explore all our free betting calculators to help you make informed decisions about your wagers before you place them.

Frequently Asked Questions

How much tax do I owe on sports betting winnings?

The amount depends on your total income, filing status, and state of residence. Federal tax rates on gambling income range from 10 percent to 37 percent based on your marginal tax bracket. Most recreational bettors with a moderate salary fall into the 22 percent or 24 percent bracket. State taxes add anywhere from 0 percent (in no-income-tax states like Texas and Florida) to 13.3 percent (California). Use the calculator above to get an estimate specific to your situation.

Do I have to pay taxes if I lost more than I won?

You still must report your gambling winnings as income. If you itemize deductions, you can deduct your losses up to the amount of your winnings under current 2025 rules, effectively zeroing out the tax on gambling. However, under the 2026 OBBBA rules, you can only deduct 90 percent of your winnings in losses, which could create a tax bill even if you broke even or lost money overall.

Does my state tax sports betting winnings?

Most states with a state income tax do apply it to gambling winnings. Nine states (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming) have no state income tax. A handful of states like Indiana, Massachusetts, and Wisconsin do not allow gambling loss deductions, meaning you pay state tax on gross winnings. Check our state taxes on sports betting guide for your state's rules.

What is the federal tax rate on gambling winnings?

There is no special federal tax rate for gambling. Winnings are taxed as ordinary income at your marginal tax rate, which ranges from 10 percent to 37 percent depending on your total taxable income. Sportsbooks may withhold 24 percent on large payouts, but your actual rate could be higher or lower. See our sports betting tax rate guide for bracket details.

Can I deduct my sports betting losses?

Yes, but only if you itemize deductions on Schedule A of your tax return. You can deduct gambling losses up to the total amount of your reported gambling winnings. You cannot use gambling losses to offset other income like your salary. Starting in 2026 under OBBBA rules, loss deductions are capped at 90 percent of winnings.

Do sportsbooks report my winnings to the IRS?

Sportsbooks are required to issue Form W-2G for payouts of $600 or more when the winnings are at least 300 times the wager. However, even when no W-2G is issued, your winnings are still taxable and must be reported. Many sportsbooks also report aggregate payout data to state regulators. The IRS expects you to self-report all gambling income.

How does the OBBBA affect my sports betting taxes in 2026?

The One Big Beautiful Bill Act introduces a 90 percent cap on gambling loss deductions starting in 2026. Under current rules, if you won $10,000 and lost $10,000, your net taxable gambling income is zero (if itemizing). Under OBBBA, you can only deduct $9,000 of those losses, leaving $1,000 in taxable phantom income. This affects anyone who itemizes and has significant gambling losses.

Should I make estimated tax payments on my sports betting winnings?

If you expect to owe $1,000 or more in taxes at year-end (including gambling taxes), the IRS generally expects quarterly estimated tax payments. Failing to make these payments can result in underpayment penalties. Bettors with large or consistent winnings should consider making estimated payments in April, June, September, and January. The calculator can help you estimate your annual liability so you can plan your quarterly payments accordingly.