Sportsbook/Gambling Taxes

[skives]

I live in Michigan and I know the income tax rate is 4.25%. Is it correct that the federal tax rate on sportsbook/gambling winnings is a flat 24%?

My second question is what are consider winnings? I’ve read a couple different things. Lets say I place a $50 bet and it pays out $100. Do I pay tax on the $100 or just the $50 I won?

[moneybags]

Federal taxes - you'd pay at your tax rate, not a flat rate. If you win over a certain amount, you will be issued a W2-G; I think over $600 for the year on a betting app. The amount would be the win amount, not the profit. You can deduct gambling losses against the win. So if you get a W2-G for $600 and you bet $300, you'd pay taxes on $300. The loss deduction does not have to be tied to the specific bet; you can add up all your losses, but you can't take a loss.

[rigz]

What do you mean he should pay for both of them?

[AMorrison]

Meh now and in gambling, to pay a tax of 4% is quite a lot

[myrdale]

I don't know the first thing about such regulations, much less in your state. I would have assumed that it counted as income and would have been taxed as such.

If that is the case, I would have guessed you could write off your losses as well.

I suspect I am grossly wrong. I only commented to let you know I think it is interesting.

[disneysteve]

This thread has become a huge spam magnet so I'm going to go ahead and close it.