Any good online betting site will offer odds on horse racing events from all over Canada and the world. Like sports and casino winnings, bettors in Canada are not required to pay taxes on the money they win betting on the horses. Betting on eSports. The last part of an online betting site is its eSports betting section.

When it comes to sports betting and taxes, many people are left in the dark. Because the industry was underground and operating through offshore markets for an extensive part of the 21st century, there is the belief that you don’t have to start paying taxes on your sports betting winnings. This couldn’t be further from the truth, as all income no matter how big or small is to be reported to the IRS. Doing so can seem like an unnecessary obstacle and you will likely see the state or federal government collect a percentage as their cut but it is still a requirement, nonetheless.

1. The Italian government looked to increase tax revenue and capitalize on the country’s love of soccer by introducing legislation to allow sports betting in the mid-2000s. This allowed anyone who acquired a license to take sports betting action either online or in a land-based retail environment.
2. Illinois’ impending sports betting launch coincides with national Problem Gambling Awareness Month. It also happens to fall in the heart of tax season, and yes, Uncle Sam gets a cut of the action.

Filing your taxes isn’t that difficult but there are still some procedures that first-time claimers might not be aware of. Use this page as a guide for sports betting and taxes. The proper channels are more widely utilized since the repeal of PASPA in 2018, but there was never a mandated report offering help for those looking to claim their legal winnings. Remember, it doesn’t matter if you made your money with an offshore legal sports betting site or with a local, state-licensed operator, winnings are winnings and the government will want a piece of the action.

Claiming Your Winnings On Sports Betting

According to the IRS, it is required by law to claim your gambling winnings on your taxes. All income is taxable, this includes gambling winnings from international sports betting sites as well. You must claim any cash winnings, prizes, winnings from lotteries, raffles, as well as any casino winnings you earned throughout the year. The IRS is not concerned with where you got your winnings from, whether that be state-sanctioned gambling or offshore gambling sites, the government wants you to claim it. Even if you are betting on sports through international sports betting sites in a state that has yet to regulate sports betting, you must still claim those winnings on your taxes.

The percentage that the government takes from your sports betting winnings are dependent on a slew of circumstances. These include how much money you make, how much income you took in through sports betting, which state you live in, how your family dynamic is, and many more. There is no set percentage that is taken from your sports betting winnings so you will not know how much you owe the government until after you file your taxes. It is important to claim your winnings on your taxes as if you do not you can be subject to fines and retroactive back taxes being demanded by the IRS.

Filling Out Tax Form 1040 For Sports Betting

Because the establishment you won your winnings from may have sent a Form W-2G to the IRS on your behalf, it is important to be responsible and claim your sports betting winnings. When this form is submitted, they explain how much you won, on what kind of wager, and how much (if any) tax they withheld (which is usually 0). This situation only happens in a few situations such as large wins but it is still best to have your own information on hand.

On Tax Form 1040, you will total your winnings from sports betting on line 21. This line is listed as “other income” and simply write in your total money won. If you live in a state with state income tax, the process will slightly differ but be of similar circumstances on your state income tax filing. States such as Alaska, Florida, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming are all exempt from state income tax.

What About My Gambling Losses?

Even if you made money overall for the year, you should still claim your losses as well. This goes on your Schedule A form under line 28 titled “other miscellaneous deductions.” You only pay taxes on your net winnings, so proving that you lost a decent amount will greatly negate a majority of the taxes if this is the case. Keep in mind you must be able to provide a detailed record of your winnings and losses but this information can help in the long run.

If you are claiming a yearly loss, your deductions cannot exceed your reported winnings. Stated in an example, if you won a $500 bet but lost $2,500 on the year, you can only claim $500 in losing wagers. In short, you cannot claim a loss for more than you won in gambling. Similarly, if you won nothing and lost $250, nothing can be deducted from your gambling efforts.

Penalties For Not Abiding By Sports Betting Tax Laws

Penalties for not abiding by sports betting tax laws are just as bad as anything else. The government will stop at nothing to receive the money they’re owed. Do not ever believe it is a good idea to try and fly under the radar when it comes to declaring your sports wager winnings. Unpaid taxes will gain in interest and if you cannot afford the price you will end up owing in the end, they have the right to garnish your wages in order to collect. It’s always best to declare this income and pay what you owe, if anything at all, right then and there. It could really come back to bite you later if you don’t and with a much steeper price tag.

Avoidance of paying these taxes is seen as a form of tax evasion. That is a felony charge. The fine for this can be as high as $100,000 depending on how many counts (times you’ve forgotten to pay taxes on your payouts), it could make that number even higher. Five years in prison is also on the table as a form of punishment. If it comes to this point, people that are found guilty will not only have to pay any back taxes owed but court costs and legal fees on top of that. And after all is said and done, they could still face considerable prison time. The takeaway? Pay your taxes because this is one gamble not worth taking.

Can I Keep My Winnings In An Offshore Account To Avoid Paying Taxes?

This is a question that many go back and forth regarding the correct way to claim your offshore sports betting winnings. While some believe that the moment you win a wager, you are required to claim it, others have the full belief that claiming winnings on your taxes from sports betting is not required until you bring the money back into the country. In reality, there is no exact answer. Different sportsbooks will have different terms and conditions that bettors must follow. Likewise, each state regulates tax law in a different manner, so what is true in one location may be the opposite in another.

Do Casinos Have To Report A Customer’s Winnings?

Casinos can withhold the taxes on your winnings should that be part of their policy. If a bettor has won more than $5,000 it is common practice for the establishment to take out the necessary taxes. After that point, they will also send their customers a W-2G form to fill out during tax season. Any sports betting earnings that go beyond $600 are expected by the IRS to be reported by the gambler when they file their taxes. While overseas gambling technically happened offshore, the IRS still wants that income reported and taxed accordingly. Should bettors fail to report their gambling earnings on their taxes, they run the risk of a future audit as well as all costs and fees to recover what was owed originally.

Reporting Offshore Sportsbook Earnings

Even if you’ve won all of your money gambling with offshore sportsbooks, the U.S. government, more specifically, the IRS wants to know about it so that you get taxed accordingly. Failure to report these funds on your tax returns could lead to future audits or inevitable payments that you thought you were free from. Most sports betting operators will send a statement to their members but it’s not their sole responsibility to do so. It’s up to the gambler to be truthful about what they’ve won through placing bets.

However, not every sports bettor needs to claim their winnings on their taxes. If you’ve won less than $600, you’re in the clear as far as reporting them is concerned. You can choose to report them but you also will not be in any trouble for not reporting them if that’s the route you take. Anything over the sum of $600 needs to be accounted for so that it can be taxed. This includes Super Bowl gambling taxes, March Madness, or just any old bet. Be sure to set aside a bit of money by the time tax season comes around, just in case at the end of filing you need to pay on your winnings. When combined with other deductions, sometimes you’re all clear as far as owing any money is concerned as it sorted itself out through other areas within your overall tax return.

Tips For Reporting Sports Betting On Tax Returns

Winnings from gambling on sporting events are considered income by the IRS therefore making it taxable. If the yearly earnings from one platform is a sizeable amount, the operator will send the gambler Form W3-G, Certain Gambling Winnings. Using this form is completely fine if the bettor has received one. However, if they did not, their earnings should still be reported on Form 1099. From Daily Fantasy Sports (DFS), Leagues and Contests, or general sporting event wagers, anything that surpasses the $600 mark needs to be reported by the taxpayer.

Sportsbooks, where the business is done, will typically send both the player and the IRS Form 1099-MISC with all of the proper information as they are obligated to do so. Should this not happen, the taxpayer still needs to fill out Form 1099 on their own. And as always, losses can be part of an itemized list of deductions should they not exceed the amount of money earned through gambling. If it does, only deductions of the same amount in winnings can be claimed.

Where should we begin when it comes to discussing the European online gambling market? The European market has seen its fair share of ups and downs, but also have led the way in the introduction of games, betting styles and platforms since the inception of the industry.

We are going to speak of the European market in general terms on this page; obviously, there are some significant differences in each individual country’s approach to online gambling.

For now, let’s review some of the essential common elements that anyone should be looking at when they are choosing an online gambling site to play from Europe.

Here Are Our Top Recommended European Online Gambling Sites:

Also on This Page

We review all the European-facing sites we can find, from the most established brands to the brightest of newcomers. Of course, every site is a little bit different, and many have restrictions depending on where you live. With that in mind, we encourage you to read our individual reviews to learn about each company in detail. To help you get started, we have compiled a list of our top 5 recommended European Gambling Sites above, which we are sure will offer you a fantastic experience.

There is no single answer to this question. With a region made up of so many different countries, it is not surprising to see that there are also various stances on online gambling. While the region is very advanced compared to North America regarding the legalities of online gambling sites, for many countries it is still a work in progress. In fact, the European gaming regulation map looks similar to that of the individual U.S. states.

In each of our individual country reports, you will get an in-depth review of that country’s regulatory environment. With the introduction of the European Union, it seemed like the collective wrote an onion about its stance on many topics, including gambling.

For the purposes of a general review let’s highlight a few in summary form:

The UK have long been operating in a regulated environment, and in fact, the Internet Gambling Act enforces the fact that to legally accept UK players, an online gambling website needs to apply for and receive a license from the Gambling Commission. This application process is rigorous, and the Gambling Commission does not look favorably at companies who have in the past accepted players from unregulated markets.

The Spanish Gambling Act was entered into law to help manage the federal oversight of regulated gambling, which was before that left up to the individual states. As a result of this legislation, operators can apply for a license that if received will allow them to legally accept Spanish players to gamble on all forms of online games.

The French also have a form of regulated online gambling, which allows licensed operators to allow sports betting, poker, and horse racing. Despite their love of card games, there is no option for obtaining a license to offer online casino games, so any operators who can provide those games in addition to poker and sports in other jurisdictions must shut them off for any players that come from France.

The Italian government looked to increase tax revenue and capitalize on the country’s love of soccer by introducing legislation to allow sports betting in the mid-2000s. This allowed anyone who acquired a license to take sports betting action either online or in a land-based retail environment. Amendments to that law over the years added other online betting options such as lottery, casino and poker and today Italians have a full range of products to select from when they are choosing an online gambling site.

Of course, all these regulations are regularly updated, so it is important that you review this page often to get the most up to date data and information. Also, even though there are a series of regulations limiting play of some or all games online depending on the country, there is no precedent for a player being prosecuted under these laws. While we cannot definitively tell you that online gambling is legal from a player perspective, it is safe to say that these governments have no current plan to curb the industry by going after every individual who bets online.

From an operator perspective, there are a few European jurisdictions where an online gambling site can get a license which will allow them to “legally” operate their companies. Of course, this license still has to mix with the individual European country laws, so this licensing actually exists as a way to protect players from shady operators stealing their money.

The four jurisdictions in Europe were an online gambling site can apply for a license are Alderney, Isle Of Man, Malta, and Gibraltar. A site does not need to acquire more than one license (although some have) and each location has its own individual benefits.

Betting Sites Online

Fortunately for European players, the amount of regulation they find in the region opens the doors for all sorts of payment processing options. What this means for players is a choice to use debit and credit cards, third-party payments companies, and even Paypal to make their deposits and withdrawals.

What does this look like? Here is a partial list of third-party e-cash payments providers for the European market:

Some of these may not be available in your country, but there is no doubt that you will have heard of many of these and may even already have accounts with them, which will make your online gambling experience even easier!

Betting Sites With No Tax Exempt

Finally, when you are researching what online gambling site to play at, you should look to see if they offer games in your local currency. Most sites will offer games in Pounds or Euros, which covers a significant amount of people, however, if you are in a country with its own currency, we don’t want you to find yourself paying adverse exchange rates just to get the currency into your account. Our reviews of European-facing gambling sites outlines all the currencies that a site accepts.

Mobile Gambling in Europe

As we discussed, the European online gaming market is more mature than their North American counterparts.This is best seen in the way that Europeans gamble on their sports, especially soccer.

Allowing players to gamble from their mobile devices means that the tens of thousands of possible bettors sitting in any soccer stadium have the opportunity to place wagers on what they are watching in real time.

Online operators quickly built mobile-friendly platforms to accommodate this type of betting, and that quickly spread to all forms of sports betting. These days, European players can play all their favorite online games directly from their phones or tablets, including most casino games and poker. Each individual European country has their own laws in place, but many countries also allow for native apps to be downloaded to devices to enhance the quality of the player experience further.

Finding the Best Promotions From European Gambling Sites

When you are looking for a European online gambling site, it’s important to take into consideration what types of promotions a site offers and to make sure that their offers fit your needs. If you are a sports bettor and most of a site’s promotions are free-spin-based, for example, then we wouldn’t recommend you make a deposit. The bonuses you receive at a site are part of the value proposition that will assist in making you a profitable player over the long run.

With so many different games being offered by the biggest online gambling sites, marketing departments for these companies are working overtime to make sure all their promotional offers are attractive to any player who comes along. On top of the free chip and free bet promotions designed to reward players for creating accounts without depositing, you should be looking for the best return on your initial deposits and any loyalty programs the site offers to extend your play.

Finally, with so many countries in play, many online gambling sites tailor some promotions to be localized for specific countries. For example, you may find a poker promotion that rewards players from France only to qualify for a local live tournament or sporting event; those types of promotions offer great value as the player pool is likely much smaller than for the site’s global promotions.

What About Customer Service for All These Customers?

Betting Sites With No Withholding Tax

Customer Service can be a minefield for many online gamblers. Getting through to a live person to speak with at the time you need them can be a frustrating process, which becomes even worse when you realize that the person with whom you are speaking does not speak your language. No amount of Google translate can help in these situations; it usually makes the process slow and painful.

Most of the large online gambling sites that offer games to Europeans also provide customer service in several languages. This is usually determined by the number of players from a given country that is in the site’s database. Sometimes this specialized customer service is only available during peak hours, but in a worst case scenario you will always be able to email the site with your issue, and you will most likely receive a response back in your language.

Betting Sites With No Tax Purposes

North American online gamblers have a significant amount of envy when they see all the options Europeans have for regulated, legal online gambling.

Betting Sites With No Tax Returns

Add in some killer promotions, and it’s entirely clear that any European that has the ability to gamble online should be able to find exactly what they are looking for to suit their needs.