What is the Tax I Need to Pay Betting Sports in North Carolina?
You've been betting sports and winning big in the Tar Heel State this past football season.
|
But tax time looms.
Be mindful, that if you've won a certain amount of money betting sports from North Carolina, those winnings need to be reported on your tax filings.
While it's true that offshore sportsbooks and local bookies aren't typically going to report your winnings to the IRS, betting companies licensed in North Carolina like DraftKings, FanDuel and BetMGM will.
For 2024 and 2025 filings, Gambling winnings are taxable income with current state law effectively taxing losses, as well. Winnings are subject to federal taxes (at anywhere from a 10- to 37-percent rate) and state taxes (at the 4.25-percent personal income tax rate in North Carolina). It is important to monitor changes each new tax season.
FanDuel, DraftKings and other licensed sportsbooks in the state typically have obtained your social security number, therefore, there is no hiding.
Even if you do use an offshore sportsbook or a local independent bookmamker, Gambling911.com still encourages you to report your winnings.
North Carolinians bet around $6.1 billion in the first year of mobile sports betting legalization. The first bets were taken in March of 2024.
With an 18% tax on gross wagering revenue, the billions of dollars wagered brought in more than $128 million in estimated tax revenue from gambling applications through February.
“It’s absolutely incredible,” said Rep. Zack Hawkins, who was one of the primary sponsors. “Mainly managed a lot of where the revenue went to help make sure that all the dollars that we knew were coming could go to help best support other areas across the state.”
In February, North Carolina gamblers wagered nearly $526 million on sports, plus an additional $17 million in promotional or free bets. The bettors were paid $485 million in winnings.
North Carolina is still among the states that allow gamblers to bet on college player props. That could change as more and more states are being pressured to stop allowing this type of wagering due to harassment of players and the potential for match fixing.
If we had to guess, North Carolina will likely be among the last states to place restrictions on college wagering. This, after all, is home to some of the best college basketball in the country.
|
