What Are the Online Casino Reporting Requirements?

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Jackpot handpay Epic Fortunes

Most players who play in a physical casino know the reporting requirements for a jackpot, or handpay, is $1,200. So a player naturally wants to know:

So I can win money all day in a casino and unless I win a hand pay, it’s not reported. How does it work with online slot play as far as reporting your winnings?

Debbie F.

The reporting rules, regardless of location, are exactly the same, as it’s an IRS requirement that sets the rules. As such, an online real money gaming casino will have the same $1,200 level for reporting a taxable jackpot.

Of course, being that it’s online, it works a bit differently in that you don’t have someone walking over with a piece of paper and counting money into your hand. 

The online casinos have what are known as Know Your Customer, or KYC, requirements, so when you first sign up they get to know you better than if you just walk into a casino and slide a $20 into a slot. When you get your first reportable win, they may have a few basic questions to ask you, but they’ve oftentimes already captured most of your information.

At the end of the year, you’re able to log in and grab your W2G documents for reportable wins, and use them like any other W2Gs when filing your taxes.

Now note that we said real money gaming casinos. This specifically speaks to the casinos in regulated markets (which as of this posting are about a half dozen states that have legalized real money gaming in their state). 

There are other options out there, and those options will likely follow different rules for various reasons. For instance, social casinos that operate under a sweepstakes model will fall under sweepstakes laws, including around taxes, that players should be aware.

But as far as real money gaming online casinos, the rules are quite familiar.

The thing is, whether won in person or online, all winnings are considered income according to the IRS. But it’s only wins of $1,200 and up that are automatically reported. The rest is up to us as players.

Have a question? Submit yours here!


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2 Replies to “What Are the Online Casino Reporting Requirements?”

  • Joel DeWitt says:

    If you live in California, you can not do online gambling

    • FlipTheSwitch.com says:

      This is correct. Real money gaming is available in six states at the moment (Connecticut, Delaware, New Jersey, Michigan, Pennsylvania, West Virginia) with a seventh coming soon.

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