How do I have to tax my sports betting wins in New York City? 

Online sportsbooks are finally open in New York, and there is no doubt that New Yorkers enjoy gambling in sports.

The ribbon-cutting of legal sports betting has been a significant success among New Yorkers. You can now enjoy betting on your favorite NY teams and sports from the comfort of your home. However, with this success comes sizable civic responsibility; tax treatment.

Gambling wins fall into a separate tax bracket. This means that you owe taxes primarily based on the amount of your annual income plus gambling winnings. It doesn’t matter if you prefer in-person or mobile betting; the tax treatment is crucial as the IRS considers all gambling winnings taxable. That effectively means you must report all the wins on both your federal and New York state tax returns.

Best Brand

BetMGM Bonus

Up To $1500 in Bonus Bets Paid Back if your First Bet Does Not Win

Get bonus now

Gambling problem? Call 1-800-GAMBLER or 1-800-MY-RESET (Available in the US) 877-8-HOPENY or text HOPENY (467369) (NY) 1-800-327-5050 (MA), 1-800-BETS-OFF (IA), 1-800-981-0023 (PR). 21+ only. Please Gamble Responsibly. See BetMGM.com for Terms. First Bet Offer for new customers only (if applicable). Subject to eligibility requirements. Bonus bets are non-withdrawable. In partnership with Kansas Crossing Casino and Hotel. Promotional offers not available in Mississippi, New York, Ontario, or Puerto Rico.

Best Bonus

FanDuel Bonus

New Users – Get $350 in Bonus Bets Guaranteed – When You Bet $5 for 7 Days!

Get bonus now

Gambling Problem? Call 1-800-GAMBLER or 1-800-MY-RESET. Call 1-888-789-7777 or visit ccpg.org/chat (CT). Hope is here. GamblingHelplineMA.org or call (800) 327-5050 for 24/7 support (MA). Visit mdgamblinghelp.org (MD). Call 1-877-8HOPE-NY or text HOPENY (467369) (NY). 21+ (18+ DC, KY, WV). Void where prohibited. Gambling problem? Call 1-800-GAMBLER or visit www.gamblersanonymous.org . Must be 21+ in NJ, PA, MI, or WV. $10 first deposit req. Bonus issued as non-withdrawable bonus spins which expire 7 days after receipt. Restrictions apply. Contact 1-877-770-7867 (LA).

Newcomer

Caesars Bonus

Bet $1 and get double the winnings up to $25 for your next 10 bets

–

21+ New users only. Must register using eligible promo code. First bet after registration must qualify. Max. Bonus Bet: $1,000. Bonus Bet expires 14 days after receipt. Void where prohibited. See Caesars.com/promos for full terms. Gambling Problem? 1-800-GAMBLER (1-800-426-2537)

What is the taxation bar for winnings from gambling in New York?

When you sign up with a NY sportsbook, you’ll need to provide proof of your ID, which immediately identifies you as a potential tax payer. If you collect winnings from a sports betting site, FanDuel New York for example, those winnings are subject to state and federal taxes. However, it is vital to note that tax is imposed on gambling winnings only when you reach a certain threshold.

So, you are subject to tax on sports betting activities only if you earn over $600 in a calendar year. In addition, on your W-2G, you should report the fair market value of any prize you win, such as a car, trip, or any other kind of prize.

How is gambling taxation allocated in New York?

The New York state gambling tax is reliant on annual income. You can find your New York state tax rate anywhere between 4% and 8.82%. Lowest tax rate is 4% for income below $8,500 and highest is 8.82% for income above $1,077,550. So, it is important to keep in mind that your state tax rate will increase when your taxable income rises. This is in addition to the flat 24% federal tax applicable on your whole winnings.

4.6/5

BetMGM Review

Up To $1500 in Bonus Bets Paid Back if your First Bet Does Not Win

Bet now

Gambling problem? Call 1-800-GAMBLER or 1-800-MY-RESET (Available in the US) 877-8-HOPENY or text HOPENY (467369) (NY) 1-800-327-5050 (MA), 1-800-BETS-OFF (IA), 1-800-981-0023 (PR). 21+ only. Please Gamble Responsibly. See BetMGM.com for Terms. First Bet Offer for new customers only (if applicable). Subject to eligibility requirements. Bonus bets are non-withdrawable. In partnership with Kansas Crossing Casino and Hotel. Promotional offers not available in Mississippi, New York, Ontario, or Puerto Rico.

4.5/5

FanDuel Review

New Users – Get $350 in Bonus Bets Guaranteed – When You Bet $5 for 7 Days!

Bet now

Gambling Problem? Call 1-800-GAMBLER or 1-800-MY-RESET. Call 1-888-789-7777 or visit ccpg.org/chat (CT). Hope is here. GamblingHelplineMA.org or call (800) 327-5050 for 24/7 support (MA). Visit mdgamblinghelp.org (MD). Call 1-877-8HOPE-NY or text HOPENY (467369) (NY). 21+ (18+ DC, KY, WV). Void where prohibited. Gambling problem? Call 1-800-GAMBLER or visit www.gamblersanonymous.org . Must be 21+ in NJ, PA, MI, or WV. $10 first deposit req. Bonus issued as non-withdrawable bonus spins which expire 7 days after receipt. Restrictions apply. Contact 1-877-770-7867 (LA).

4.5/5

DraftKings Review

New DraftKings Customers: Spend $5+ Get $200 in Bonuses Instantly!

Bet now

GAMBLING PROBLEM? CALL 1-800-GAMBLER or 1-800-MY-RESET, (800) 327-5050 or visit gamblinghelplinema.org (MA). Call 877-8-HOPENY/text HOPENY (467369) (NY). Please Gamble Responsibly. 888-789-7777/visit ccpg.org (CT), or visit www.mdgamblinghelp.org (MD), 1-800-981-0023 (PR). 21+ and present in most states. (18+ DC/KY/NH/PR/WY). Void in ONT. Eligibility restrictions apply. On behalf of Boot Hill Casino (KS). Pass-thru of per wager tax may apply in IL. Wagering offered by DK Sportsbook. 1 per new DraftKings customer. $5+ first-time bet req. Max. $200 issued as non-withdrawable Bonus Bets that expire in 7 days (168 hours). Stake removed from payout. Terms: Promos | DraftKings Sportsbook . Ends 6/28/26 at 11:59 PM ET. Sponsored by DK.

All you need to know about the W-2G form for your tax payments

You’re going to need a form called a W-2G to separate gambling taxes from your regular taxes.

In essence, the IRS issues this form automatically if they have records of you receiving payouts from gambling, so it serves as a record of your winnings. After you fill out your W-2G, you’ll know how much tax you need to pay on your gambling winnings. Remember, even if no income tax notice comes your way or you did not receive a W-2G, it doesn’t exempt you from notifying the IRS. If you receive any income from gambling, including betting on esports in New York, you must report it on your state and federal tax returns.

In the end, it’s your responsibility to report any wins you receive from sports betting. So, it is crucial that you keep track of all your wins and losses when you use sportsbooks in New York for your legal security.

In addition, almost all of the best online sportsbooks, such as BetMGM New York, understand the importance of this and provide a handy way to track your wagering activity on their platforms. So, if you’re looking to enjoy gambling in New York, don’t forget to check out sportsbook NY reviews and betting guides from our experts.