Do You Pay Taxes on Cruise Ship Casino Winnings?

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This is a question without one all-encompassing answer, because cruise ships depart from ports around the world, and are registered in specific countries. But for the purposes of this answer, we’ll focus on cruises that both start and end in the United States, as that’s where the largest segment of our audience is from.

In those cases, cruise ships do report slot machine, video poker and video keno jackpots of at least $1,200 on a single wager to the IRS, just as land-based casinos in the United States do. This means you’ll receive a document confirming the win and have to report it as part of your tax documents submitted with your return the following year.

As far as whether you pay taxes, we’ve not encountered a situation where taxes are deducted at the time of the jackpot. Many times in physical casinos, you can opt to have taxes withheld, and in some cases it’s mandatory for state withholding. These will vary by jurisdiction, and occasionally by casino. 

But we have not seen a scenario on a cruise ship where taxes would be taken out. This is not to say that some won’t, and if you have feel free to confirm in the comments!

How taxes are handled at tax time will often depend on whether a player can itemize their deductions or not. If a player is claiming the standard deduction, gambling losses can’t be used to offset wins because losses are themselves a deduction and the standard deduction covers all. But when you itemize, there is more flexibility and there is the possibility of gambling loss deductions.

That said, we always wish to underscore that we are not accountants, and every person’s tax situation will differ in a variety of ways, so we do advise players to talk to an accountant and confirm the best approach for themselves.

UPDATE 12/26/23: A couple of players have noted that MSC does not file paperwork when you get a jackpot-sized win. It’s important to note that all gambling winnings is still considered income in the eyes of the IRS.

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2 Replies to “Do You Pay Taxes on Cruise Ship Casino Winnings?”

  • Tiffany Brady says:

    When you play online with the Sweepstake Coins and hit over 1200 SC in a single pull or bonus, do you have to pay taxes on that win like you do in casinos and on cruises?

    • FlipTheSwitch.com says:

      Sweepstakes have different tax rules than casinos, and as such it’s a different structure you’re working under. We recommend chatting with an accountant to understand how this may impact you if you play – everyone’s tax situation is a bit different and so we also recommend talking with someone who has experience handling sweepstakes prizes on tax returns.

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