I Won $1,000 at the Casino. Do I Owe Taxes?

Gambling winnings are taxable, although you may be able to deduct some of your losses

Sandra Block,

AARP

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Published March 20, 2026

two pairs of hands collecting casino chips

If you win big at gambling, Uncle Sam still gets a cut.

Pete Ryan

I’ve never been much of a gambler. On the handful of occasions that I’ve participated in a March Madness pool, I’ve bet on the schools with the best academic reputations, which is not a winning strategy. A few years ago I visited Foxwoods, a popular resort casino in southeastern Connecticut, but I didn’t play the slots. Instead, I got a massage and had lunch.

I’m an outlier. Nearly 60 percent of U.S. adults participated in some form of gambling in 2025, according to research by the American Gaming Association. More than a quarter gambled at a physical casino, and 21 percent placed a sports bet.

Many casinos offer older adults discounts on hotels, chartered bus trips from nearby cities, food vouchers and other perks. And when it comes to sports, it’s never been easier to place a bet on the outcome of a game, or even just a piece of the action. Online sports betting has made it possible to bet from the comfort of your sofa on everything from the Super Bowl coin toss to the length of the national anthem.

If you struck it big, whether through the lottery, a casino or your church’s bingo night, your jackpot is taxable. That goes for noncash winnings, too, such as a vacation won in a raffle. In that case, you’re expected to pay taxes on the fair market value of the prize. Depending on where you live, you may owe state taxes on your winnings, too.

Gambling operators are required to report proceeds on IRS Form W-2G if they exceed specific thresholds. You’ll likely receive a W-2G in the mail if you won $600 or more and the amount you won was at least 300 times your bet. You may also receive a W-2G if you won $1,200 from bingo or slot machines, $1,500 from keno, more than $5,000 from a poker tournament, or over $5,000 from sweepstakes, wagering pools or lotteries.

If you receive a W-2G, don’t ignore it when you file your taxes, because the provider also submitted the form to the IRS. Even if you don’t receive a W-2G, the IRS expects you to pay taxes on your winnings, no matter the amount.

Putting your losses to work

There’s a reason casinos and online gaming platforms are highly profitable. Most gamblers eventually lose money — hence the expression “The house always wins.”

If some of your bets failed to pay off, you may be able to use your gambling losses to reduce or eliminate taxes on your winnings, but you must itemize to claim this deduction. Since the 2017 Tax Cuts and Jobs Act doubled the standard deduction, only about 10 percent of taxpayers itemize. Older Americans who have paid off their mortgages have even less incentive to itemize, since they no longer deduct mortgage interest.

Taxpayers who itemize will face a new limit on the amount of losses they can deduct. In the past, you could deduct up to the amount of your winnings, so if you scored $1,000 at the casino and lost $1,000 on a sports bet — and you itemized — you wouldn’t owe taxes. But a provision in the One Big Beautiful Bill Act signed into law in July 2025 limits the deduction to 90 percent of winnings, effective this tax year. So if you won $1,000 and lost $1,000, you’d only be allowed to deduct $900 on your tax return.

Lawmakers from Nevada have introduced legislation to reverse the provision, arguing that it requires gamblers to pay taxes on income they never earned, but the bill’s outcome is uncertain. In the meantime, keep good records of your wins and losses, because when it comes to taxes on betting, it doesn’t pay to gamble with the IRS.

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Sandra Block has covered personal finance for more than two decades. She was a senior editor at Kiplinger Personal Finance and a reporter for USA TODAY. She is the coauthor of The Busy Family’s Guide to Money and Easy Ways to Lower Your Taxes: Simple Strategies Every Taxpayer Should Know.