By Betting Buzz
Well, that was damn fast.
Just last month, the Supreme Court overturned the 1992 Professional and Amateur Sports Protection Act (PASPA). Delaware wasted no time by legalizing sports betting on June 5.
Because parlay wagering was already allowed on NFL contests, the legal infrastructure was already in place. But, for the first time, residents can make bets on individual NHL, NFL, MLB and MLS games as well as golf and auto racing.
While bettors and sports fans are celebrating, Uncle Sam wants his share of the action.
Delaware residents can expect a betting establishment to withhold 24% of winnings if they’re over $5,000. And gamblers could owe more depending on their tax bracket. (Winnings on sports betting is considered income and needs to be reported on Form 1040 at tax time.)
However, some good news: Gamblers can deduct losses up to the amount of their winnings as long as they bypass the standard deduction and itemize the deductions instead. It can get a little complicated so be sure to check out all the tax rules and regulations regarding income from sports betting.
It’s also possible to have taxes withheld on winnings under $5,000 if you’ve won at least 300 times the original wager (for instance, $1,500 on a $5 bet).