1. New York Gambling News
2. New York State Winning Numbers
3. Does New York State Tax Gambling Winnings
4. New York Online Gambling
5. New York State Tax Rate On Gambling Winnings

Gambling losses are indeed tax deductible, but only to the extent of your winnings. This requires you to report all the money you win as taxable income on your return. However, the deduction for your losses is only available if you itemize your deductions. If you claim the standard deduction, then you can't reduce your tax by your gambling losses.

New York Daily Fantasy Sports

The situation for New York daily fantasy sports (DFS) is somewhat complicated. In 2016, NY passed a law that allowed DFS sites to operate in the state. Temporary licenses were issued to the biggest brands, and everything seemed great. However, a ruling in 2018 stated that they constitute sports gambling and so should immediately cease operations in New York. Pending appeal, New York daily fantasy betting remains legal, and players can play safely and legally.

• We have a deep understanding of the New York gambling laws and study all communications from the New York Gaming Commission.
• We follow all updates and developments in the industry by regularly checking all New York gambling stories in local and major media outlets such as the New York Times and the Wall Street Journal.
• We create free beginner’s guides to some of the most popular casino games. If you want to find out handy tips, check out our slots or roulette pages.

• Wall Street Journal
• New York Gambling Commission
• New York Times

Gambling Laws in New York

Daily fantasy sports are not the only form of gambling that is complicated legally, not to mention that there are states where it is not allowed whatsoever, such as the DFS in Arizona or Idaho. It is not a wonder that there have been a number of back and forths on various issues throughout the history of New York gambling. However, let’s start with the straightforward things.

At the moment, land-based casinos, charitable gambling, horseracing and lotteries are legal in New York. Pari-mutuel wagering on horseracing at licensed events away from the actual racetracks is also permitted, which is unusual in America. Sports betting, while technically legal, is not currently possible within NY, as there are no licensed operators.

New York Sports Betting

Sports betting is legal in New York State and has been ever since the overturn of a federal law in May 2018. However, unlike other states, such as Rhode Island for example, it is yet to see its first legal sports bet. This is because the state legislation has been held up, delaying the regulation and issuing of any licenses. If you are willing to learn more about the current possibilities and the changes that are happening, you can take a look at the page dedicated to New York sports betting. However, while you are waiting for legislation to appear, it will not be bad to at least have a look at what other states have to offer. Nevada offers sports betting in a way that it might interest you.

New York Online Casinos

While there are land-based commercial and tribal casinos in New York State, there is, at the moment, no way to legally gamble online. This is because there are no licensed online operators, and accessing a site based outside of the state is a crime under New York law. If you want more details on the matter, check our guide for casinos in New York.

New York Online Poker

Things are pretty much the same for poker as for New York online casinos: there is currently no ways for you to play online poker legally. You can play poker at commercial casinos, or socially (though you are not allowed to make a profit from such games), but that is it currently.

New York Gambling News

New York Lottery

The New York Lottery, founded in 1966, was the second lottery to be set up in an American state, after New Hampshire. The NY lottery is connected to the multi-state systems, so residents can play in the huge draws such as Mega Millions. You have to buy tickets in person though, as online ticket sales have not yet been introduced or announced. For more details on the current online lottery situation in the state, make sure to check our New York lottery page.

History of Gambling in New York

There have been a number of different updates to the gambling laws in New York State over the years, with moves to restrict betting followed by more liberal moments. Check out the highlights below.

New York State Facts

Home to the “city that never sleeps”, there are endless facts and stories about New York State, even outside of its namesake city. It was home to Woodstock, and today has the world’s smallest church (measuring 51″x81″), a pet cemetery that has 12,000 plots and, of course, the world-famous Niagara Falls (even if that is shared with Canada). Here are some other New York facts and useful links.

Gambling Age in New York

In order to buy lottery tickets, place bets on races or play casino games at some establishments in New York, you have to be at least 18 years of age. Other casinos, namely those that serve alcohol on the floor, require patrons to be at least 21. Here are some of the important minimum age restrictions in New York State.

• Apart from in certain casinos, you must be 18+ to gamble in NY.
• You have to be at least 21 years old.
• Cannabis is illegal for recreational use, but permitted for medical purposes.

Responsible Gambling and Addiction Prevention

There are a number of national and state organizations that New York residents can turn to if they are experiencing problems with the consequences of their gambling, or if they are battling gambling addiction. The first port of call should be the New York Council on Problem Gambling.

Upcoming Regulation and Expected Changes

The biggest change that is still on the horizon for New York gambling is the full legalization of sports betting. At the moment, there are no laws stopping anyone from placing a sports bet. However, there have been many delays to the process of allowing operators to run in the state. It is expected that operators will gain licenses soon and that residents will eventually be allowed to gamble on their favorite sports, following the path set out by New Jersey gambling. Check back here for the latest updates on the situation!

Gambling and the Law®: By Professor I Nelson Rose

The Internal Revenue Code is unkind to winners -- and it doesn't much like losers, either. The federal government taxes gambling winnings at the highest rates allowed. So do the many states and even cities that impose income taxes on their residents. If you make enough money, in a high-tax state like California or New York, the top tax bracket is about 50 percent. Out of every additional dollar you take in, through work or play, governments take 50 cents.

Of course, the tax-collector first has to find out that you have won. Congress and the Internal Revenue Service know gambling is an all-cash business and few winners indeed would voluntarily report their good luck. So, statutes and regulations turn the gambling businesses, casinos, state lotteries, race tracks and even bingo halls, into agents for the IRS.

Big winners are reported to the IRS on a special Form W-2G. If winnings are to be split, as with a lottery pool, winners are reported on a Form 5754.

Pooling money to buy lottery tickets is common among employees and friends. But whether there are two or 200 in the pool, there is going to be only one winning ticket, and somebody has to turn it in. If you are that someone, make sure you fill out a Form 5754. If your share of a $5 million prize is $1 million, you do not want to be stuck with paying income tax on the entire $5 million.

Gambling has become such big business that the IRS receives nearly four million Forms W-2G and 5754 each year. This tells the tax-collectors that nearly four million big winners are out there, waiting to be taxed.

But the IRS does not always wait. The government wants to make sure it gets paid. What good does a W-2G do if the winner is a foreigner who is going to be in his own foreign country when April 15th rolls around?

So, the IRS not only wants reports filed, but often requires that a part of the winnings be withheld. As anyone who has a salary knows, withholding also allows the government to use taxpayers' money for many months, without having to pay interest.

The withholding rate for nonresident aliens is 30%. Not coincidentally, the tax rate for nonresident aliens is also 30%. So, if a citizen of a foreign country wins $1 million cash at a slot machine in Las Vegas, he will find he is only paid $700,000. The remaining $300,000 is sent to the IRS. The foreign citizen is unlikely to ever file an income tax return, but the IRS gets paid in full anyway.

New York State Winning Numbers

Citizens of foreign countries are also, of course, usually taxed by their own governments. So some countries have treaties with the U.S., which protects those foreigners from having to pay the 30% withholding to the IRS.

U.S. citizens and resident aliens have it both better and worse than nonresident aliens. The withholding rate for gamblers living in American is only 28% (it was 20%, up to 1992). Having the IRS take $28,000 out of a jackpot of $100,000 is painful. But, it can hurt even more when tax forms are filled out. There is no 30% maximum tax for people living in the U.S., and really big winners often end up paying a lot more than 28% or 30%.

The one good news is Nevada casinos were also able to convince the IRS that they could not keep track of players at table games. They said that when a player cashes out for $7,000, they do not know whether he started with $25 or $25,000. So it is actually written into the law that there is no withholding or even reporting of big winnings to the IRS for blackjack, baccarat, craps, roulette or the big-6 wheel.

There is another general IRS rule that says anyone paying anyone else $600 in one year is supposed to file a report. The IRS has been going after casinos and cardrooms that run tournaments, forcing them to file tax reporting forms on grand prize winners. Here the IRS has the very good argument that the operator knows exactly how much a player has paid to enter the tournament and how much the finalists are given.

Is there anything a winning player can do to lower the bite of the income tax? And what about those who gamble and lose? Which is everybody, occasionally. The law does allow players to take gambling losses off their taxes, but only up to the amounts of their winnings.

Of course, if you win, say $135,000, you can take off all gambling losses, up to that amount. If you gambled away, say $65,000, you would only have to pay taxes on the remaining, let's see: $135,000 minus $65,000 equals $70,000. The tax on $70,000 is a lot less than the tax on $135,000.

Of course, you have the small problem of proving that you actually lost $65,000. Large winnings may be required to be reported to the IRS; large losses are not.

One former IRS Revenue Officer, who quit government to open his own small tax preparation firm, thought he found the answer. One of his clients won a share in a state lottery: $2.7 million, paid out over 20 years in installments of about $135,000, before taxes. The winnings were reported, but the tax return claimed gambling losses of $65,000. The IRS decided that $65,000 was a lot to lose, and it sent an agent to conduct an audit.

Does New York State Tax Gambling Winnings

The tax preparer found a man with an extremely large collection of losing lottery tickets and made a deal: he would borrow 200,000 losing tickets for a month for $500. The losing tickets were bound in stacks of 100 and shown to the IRS auditor: 45,000 instant scratch tickets, 5,000 other Massachusetts lottery tickets, and 16,000 losing tickets from racetracks throughout New England. So many losing tickets, that it would have been physically impossible for one man to have made these bets. The New York Times called it, 'one of the more visibly inept efforts at tax fraud.' They pleaded guilty eight days after being indicted.

New York Online Gambling

By the way, the man who rented the tickets was not charged. It's not a crime to collect losing lottery tickets, only to use them to try and cheat the IRS.

New York State Tax Rate On Gambling Winnings