Sports betting winnings are subject to the same 24% federal tax rate as other gambling winnings. The winners are also responsible for paying the applicable local taxes. The current NJ tax rate is 8.5% for retail sportsbook wins and 13% for wins at online sportsbooks or on mobile apps.

• Nj Sports Gambling Tax Refund

1. Over 145,000 online gambling accounts have been opened by consumers in New Jersey since its inception in late November. With the 2013 tax year now closed, it’s not too early to think about the tax implications for playing online in New Jersey.
2. Operators in New Jersey have to pay tax on sports betting too. This currently stands at 9.75% for land-based casinos and 13% for online sports betting. This is not as high as states like Delaware and Rhode Island, where the tax rate adds up to over 50%.

New Jersey saw sports wagering get legalized in the state back in 2018. Over the years, the betting entities have grown in number, leaving players spoiled for choice when it comes to online gambling platforms to choose from. New Jersey was among the states that spearheaded the debate on lifting one of the bans that prohibited sports wagering outside the state of Nevada.

Ever since NJ Sports-betting legalization, this Garden State has transformed into a wagering powerhouse. Today’s read will focus on all matters sports-wagering in New Jersey, providing you with interesting insights that you will absolutely love. Read on!

Tax Rates on Sport Betting NJ

The NJ sports-betting law requires that there is an 8.5% tax charged on revenue generated from sports-betting in the state. A 13% tax is charged on the revenue from land-based casinos and a 14.25% tax charge on revenue from racetrack related sporting venues. While the tax charged on casinos that are land-based in New Jersey are higher than that charged in Nevada, it remains lower than that of states like Pennsylvania, giving NJ quite an edge above the rest.

What are some of the benefits of Lawful Online Sports-Betting in NJ?

While there are several benefits associated with wagering at NJ online sports books that are legal, it all starts with your security and safety as a player. The NJDGE (New Jersey Division of Gaming Enforcement) sees to it that all authorized sportsbooks in New Jersey are not only licensed, but also regulated.

The application process is highly rigorous just to ensure compliance with the existing gambling laws. If any sports book is in violation of the NJDGE stipulated guidelines, then they are liable to paying hefty fines.

Rest assured that the NJDGE exists to safeguard you as a gambler. Even if odds will vary from one sports book to another, this body closely monitors them all, ensuring that you bet in an environment that is not only legal, but also secure and utterly safe. If you go ahead and gamble in an illegal offshore site, you will have yourself to blame as these are not regulated by the NJDGE. As such, it is paramount that you maintain your game play within the state’s borders, where you can count on the protection of the regulators.

NJDGE regulated sports books are highly convenient, allowing you to place your wager from anywhere, provided you are within the state’s borders. It does not matter if you are a NJ resident or not; geo-location technology makes it possible for you to place your bets from any place within the state’s lines. Additionally, NJDGE regulated sports books are available for download both on IOS and Android operated mobile devices, seeing to it that players enjoy gaming on the go.

New Jersey Sports Betting Apps

The state of NJ is dotted with racetracks and casinos from where players can enjoy land-based gaming. In addition to this, players can enjoy gaming online at the comfort of their homes. Below are just but a few of the best New Jersey Sports-Betting Apps:

DraftKings

This was the first online based sports betting site to ever launch in New Jersey after legalization of online sports betting in the state. Its bonus offers, design and speed are just some of the things that make it a favorite for most. Additionally, it boasts an array of betting options, allowing for players to enjoy diverse betting from beginning to end.

William Hill

This sports book is probably best known for its land based sports-wagering establishments globally. However, over the years, it has continued soaring in the online wagering business, living up to its reputation. If you are planning to wager on New Jersey Devils’ events, then it would please you to know that William Hill Sports Book has partnered up with them.

BetMGM

If you are in search of a mobile Application that is not only easy to navigate, but also user friendly, you have to try out BetMGM.one thing that you will appreciate even more with this sports book is its swift cash outs, which allows for bettors to settle their bets even before a game comes to an end. It also features overtime insurance and an array of odd boosts.

FanDuel

If you have ever heard of this one, you know that it is not a basic application. As a matter of fact, it tends to top the list when it comes to players’ favorite sports betting Apps in NJ. To enjoy game play on it, you could just visit the FanDuel website or download the App from either your IOS or Android mobile device. This Application comes packed with numerous wagering options, impressive graphics, tons of incentives as well as an easy-to-use approach.

888Sports

Probably known for its top-notch graphics, 888Sports is a reputable operator that guarantees players safety and security. It can be accessed through Android and IOS operated mobile devices. It features impressive in-play betting options and lots of other popular bets.

PointsBet

You will love this one for the mere fact that its betting choices are out of this world. It brings New Jersey bettors both local and international sporting events to wager on. In addition to this, it features a unique ‘Points Bet’ option which awards players bigger returns whenever they make accurate predictions.

Considerations to make before choosing a NJ Online Sports Betting Site

Bonus offers & Incentives

In New Jersey, it is common practice for online sports books to offer promotions, bonuses and other incentives to bettors. This is because the gambling industry is highly competitive, and each of the operators want you to come on board. As such, be sure to take advantage of all these promotions by choosing a provider that is generous in nature, especially at the sign-up stage. Examples of bonuses include free bets, deposit match ups and welcome bonuses.

Safety

For the best experience, be sure to choose an operator that is regulated and licensed by the NJDGE, which is the Division that runs all matters related to online wagering in the state. The beauty of working with a reputable and legit provider is that your safety and peace of mind are both guaranteed.

Design and Ease of Use

Sport bettors in NJ are spoiled for choice when it comes to online wagering operators to choose from. However, none of these providers are the same; each has its own theme, graphics, design and layout. As such, be sure to look out for the site that best impresses you even in terms of navigation and user-friendliness.

Payment flexibility

All authorized New Jersey-based sportsbooks want you to have a seamless withdrawal and deposit experience. Be sure to work with an operator that is not limited in scope when it comes to matters funds. The more the options you have at your disposal, the easier better it is for you.

Wagering Options & Odds

Depending on the betting choices available, odds usually fluctuate from one site to another. In addition to this, the wagering range differs with some providers having more inclusive options as compared to others. Be sure to do your due diligence and choose a site with a more robust selection.

Types of Incentives, Promotions & Bonuses Offered at New Jersey Sports-Betting Sites

There are several NJ online sports-gambling Apps out there, which means that competition for market is equally stiff. As such, sports books have come up with creative promotions meant to lure bettors into signing up with them, and hopefully remaining loyal. Below is a list of some of the most common incentives:

First-time deposit offer

Upon registering for an account and making your initial deposit, the sports book operator matches this amount either partially or in full. In most cases, this bonus should be utilized within a specific timeframe. Sometimes, online gambling operators in New Jersey are so generous that they give reload bonuses to existing customers!

Risk-free bet

Just for encouragement, your operator of choice will ‘refund’ your funds if you lose on your first bet upon signing up by way of matching the wager you made in your account.

Free bet

This is a random cash bonus! Here, you are either required to make a bet within a specific timeframe or wager with a certain minimum amount to trigger the bonus.

Odds boost

This incentive is done only by a few operators, and it is given on very specific games. For instance, if the NJ Devils appear on an operator’s list at +150 odds in a match against NY Islanders for instance, the sports book may choose to boost the odds to +200 for all the Devil supporters.

Parlay insurance

This incentive is relatively new in the market, and New Jersey Online Sports-Betting entities are embracing it quite well. Here, if you had bet on a parlay, and all your predictions come true except for one, the operator will refund your wager. Most of the time, the parlay should contain a minimum of 4 selections, and the teams in question should be huge favorites.

Loyalty programs

For your loyalty, you will be given a kind of reward by your operator of choice. as a rule of thumb, the more you bet, the higher the reward you scoop. You can get this bonus in the form of points or even cash.

NJ Sports-Betting Choices

Money Lines

Sports books usually set points to a given game. A money line bet involves a player placing his wager based on the points or odds that are set by the operator. For instance, if team A (-150) happens to be playing with team B (+130), then the bettors should wager $100 in order to win $130 if team B wins or $150 to win $100 if team A wins.

Parlay

A parlay bet requires the player to place multiple bets instead of just one. In order to win real cash on such a bet, all your predictions need to be true. It might be risky, but the beauty is that upon winning, the payoffs are quite lucrative. Additionally, the initial bet amount is quite friendly given the high odds.

Spread

Here, the bettor bets on his or her favorite based on pre-set points. If they win by surpassing those points, then the bettor wins some profitable rewards.

Futures

As the name suggests, this is a futuristic kind of bet where a bettor wagers on a player or team, where the results are expected at a later date. A great example here is betting on your favorite team to win in the Super Bowl even before the season has started.

Teasers

With a teaser bet option, you can adjust a game’s point spread. The catch here is that the operator gives you less odds. To keep things interesting, this wager comes in Parlay format. What this means is that a 4-point teaser would require a bettor to make the same adjustment they make on one bet to all the other three bets.

Over/Under

This refers to a bet in which the bettor predicts that the game’s overall score will either be over or under the cumulative points of both teams scores or goals.

Round Robin

If you are more risk averse, then this right here is the gamble you need to consider. Unlike the parlay, a round robin does not require for all your choices to win. Here, the player creates three different parlays, each containing two teams. This is a less risky gamble, and its payouts are considerably less than those of a conventional parlay.

In-game

In play betting has been the new kid on the block for quite some time now. In this type of bet, a player has the luxury of placing their wager even after the game has started. This betting option is highly engaging and exciting as things happen right in the moment!

Major Sport Leagues That I Can Wager on in NJ

Sports Books in New Jersey offer bettors the unique privilege to place their wagers on as many international leagues as their minds allow them to imagine. For football, the major leagues are NCAA, NFL and CFL; for baseball, the MLB takes over; for basketball, the WNBA, NBA, EuroLeague, and NCAA feature; for hockey, NHL; for Soccer, EPL, MLS and English Champions League; for golf, LPGA Tour and PGA tour; for tennis WTA and ATP; for Auto Racing, Formula 1 and NASCAR, and for Martial Arts, UFC. In addition to this, NJ was the first state in the US to allow for wagers on Academy Awards to happen.

What sports can one not wager on in New Jersey?

You are not allowed to bet on any NJ College sports-team or on any College sports-related event that happens in NJ. This means that you cannot bet on Rutgers Basketball, Rutgers football, Seton Hall, Monmouth and Fairleigh Dickinson. In addition to this, players cannot place their wagers on NJ’ High School events that are sports related. Another restriction in NJ Sports-Betting is that interested parties such as coaches, players and referees should not place bets on their own teams.

FAQ

To wager, all bettors are required to be at least 21 years old

Feel free to visit any land-based casino in the state, or even sign up at an online gambling establishment in the city.

Be sure to look out for the New Jersey Devils (NHL), the New York Jets and New York Giants (NFL)

All casino operators in addition to their 2 defunct racetracks and 3 active ones can apply for online gambling licensing in New Jersey. All online sports books need to be linked to a physical location.

As at March 2020, NJ has a total of fourteen mobile/online licensed sports books.

The New Jersey Division of Gaming Enforcement (NJDGE) is charged with the responsibility of controlling and regulating the sports-betting as well as casino-gaming enterprise.

As a bettor, you need to be on the lookout for your safety and security above everything else. While winning huge rewards is also important, it should not be at the compromise of your security. NJDGE is in existence for the sole purpose of looking out for your interests as a gambler.
They closely monitor sports books to make sure that they operate while following the stipulated gambling guidelines and regulations. They are in charge of issuing licenses to operators as well. Playing at a site that is licensed by this institution ensures that you are protected and that your payouts get to you as they should.

Part of the fun of gambling is the suspense.

It wouldn’t be as exciting if you knew the outcome of your wagers ahead of time.

Another plus is that many types of gambling are legal in New Jersey. Casino gambling, horse racing, the state lottery, bingo and most recently, sports betting.

Gambling is even more fun when you win.

And, when you gamble at authorized NJ betting sites, you will be paid.

What you may not have given much thought to, though, is that NJ gambling winnings are taxable. Winnings obtained from illegal gambling applies here as well.

In this article, we will tell you everything you need to know about the federal and New Jersey state laws concerning gambling winnings and taxes.

Are NJ gambling winnings taxable?

According to the IRS, gambling winnings in any state, including New Jersey, “are fully taxable and you must report the income on your tax return. Gambling income includes but isn’t limited to winnings from lotteries, raffles, horse races, and casinos. It includes cash winnings and the fair market value of prizes, such as cars and trips.”

The IRS doesn’t mention sports betting, but winnings therefrom also count as gambling winnings and are, thus, taxable.

How much are NJ gambling winnings taxed?

Whether you’re a New Jersey resident doesn’t have any bearing on your liability to pay federal and state taxes on your winnings.

So, this includes the total of your winnings, if any, that is withheld for state taxes.

However, the type of gambling and, whether the winnings are from a retail or online site, does matter.

Taxes on NJ state lottery winnings

Prior to 2009, NJ state lottery winnings were not taxable.

However, effective January 2009, New Jersey Lottery winnings in excess of $10,000 became subject to the state gross income tax.

The percentages withheld from the state lottery payouts of more than $10,000 are as follows.

If the payee provides a valid Taxpayer Identification Number (TIN):

• 5% of payouts of $10,001 to $500,000.
• 8% of payouts more than $500,000.

If the payee does not provide a valid TIN:

• All payouts of more than $10,000 are taxed at 8%.

Rules on shared and multiple lottery wins

If two or more people win a given lottery prize and split the proceeds, as long as the total prize exceeds $10,000, it is taxed.

Each recipient must, therefore, assume liability for his or her share of the taxes even if the individual’s share does not exceed $10,000.

Furthermore, if a person wins the NJ Lottery more than once in the same year, each win is considered separately in determining whether or not it is taxed.

For example, a person who wins the lottery twice in one year, once for $6,000 and once for $5,000, would not have to pay any state tax on those winnings.

However, a person with a single state lottery win of $11,000 would have 5% of that amount withheld for state taxes.

Federal and state taxes on other NJ gambling winnings

The state lottery is one form of gambling in New Jersey for which winnings are taxable.

In fact, gambling operators must report individual wins over a certain amount for some types of gambling to the IRS.

Federal tax form W2-G

All New Jersey-licensed gambling establishments, including casinos and racetracks, are required by federal law to report certain gambling winnings to the IRS on Form W2-G.

However, the minimum win for this to happen varies, depending on the type of gambling, as indicated below:

• Horse Racing: Winnings exceeding $600 on a $2 wager or 300x any larger amount wagered.
• Slot Machines and Bingo: Winnings (not reduced by the amount wagered) that exceed $1,200.
• Keno: Winnings (reduced by the amount wagered) that exceed $1,500.
• Poker Tournaments: Winnings (reduced by the amount of the buy-in) that are more than $5,000.

Amount withheld from winnings for federal and state taxes

In every such instance, the gambling establishment must file Form W2-G to report the win to the IRS and send a copy of the form to the payee.

Since winners need this info to prepare their tax returns, they will usually receive a copy of Form W2-G in January of the following year.

Typically, the gambling facility, where the win occurred, will withhold a certain amount of the gambler’s winnings for federal and state taxes.

Before 2018, the standard withholding amount for federal taxes was 25% for those who provided a valid TIN and 28% for those who didn’t.

However, starting in 2018, the withholding rate for federal taxes is now a uniform 24%.

The amount withheld for state taxes varies from state to state.

In New Jersey, it is only 3%. That is the tax rate regardless of whether you live in New Jersey or not as long as the reportable winning took place in New Jersey.

The winner’s responsibility

The gambling facility must file Form W2-G and withhold the appropriate tax from your winnings if it meets the specified criteria.

But whether it does so or not, you still need to report your net gambling winnings as income when you file your tax return.

Obviously, gamblers who win big will find it disappointing, in most instances, to have to fork over a sizable chunk to the government.

But here’s some other news that may help you.

Ultimately, the amount of tax you owe on your gambling winnings will depend on your taxable income bracket. And, if you itemize your deductions, the extent to which you could offset those winnings with documentable gambling losses.

How gambling losses can help offset winnings

You can deduct your gambling losses, but only to the extent of your winnings.

If you lost more money gambling than you won that year, you could only deduct losses up to the amount reported as winnings. You cannot report any amount above that.

In other words, you can’t report your gambling income as a negative amount.

However, you can combine your losses from different types of gambling.

For example, if you won a big jackpot on a slots machine, but lost money on other casino games, poker and sports betting, then those losses count.

On the flip side, due to the recent substantial increase in the allotted amount you can take on your tax return as a standard deduction, itemizing your deductions may not be more beneficial tax-wise after all.

Seeking the advice and services of a professional accountant could be a worthwhile investment.

Which tax forms should you use to report gambling wins and losses?

If you are a casual gambler and received Form W-2G, be sure to include the winnings on that form. Also, include any tax withheld and any other gambling winnings you are reporting for the year on Form 1040 as “Other Income.”

Then, if you itemize your deductions, enter any offsetting gambling losses on line 28 of Schedule A (Other Miscellaneous Deductions.)

If it turns out that you paid more in taxes than you should have on your gambling winnings, you will receive a refund.

However, if too little money was withheld or you have other gambling winnings to report, you could owe more money in taxes.

In fact, casinos are not required to issue a W2-G and withhold taxes for winnings at table games (blackjack, roulette, baccarat and craps).

However, casinos expect players to keep track of such wins and include them on their tax returns.

The same applies to winnings from sports bets. You may be able to offset those wins, at least in part, with your gambling losses and other related expenses.

What happens if you receive a W-2G but don’t report the income on your tax return?

If you receive Form W-2G, whether money was withheld from your winnings or not, ignoring it is a mistake.

You need to file a tax return and show this income on the appropriate forms. If you don’t, the IRS will likely send you Form CP2000, which is a notice of underreported income.

You will be assessed additional taxes, penalties and interest on your unreported or underreported gambling winnings.

NJ taxes on sports betting winnings

If you win money from sports betting, you must pay taxes on those winnings as you would on other forms of gambling.

Furthermore, if you win more than $5,000 from betting during the calendar year, the NJ casino or racetrack is required to file a W-2G with the IRS.

In fact, for anyone betting anonymously at a retail sportsbook, keeping accurate tabs on wins for a year seems impossible.

Of course, any betting that you do online or through a mobile app is tracked within your registered betting account. As a result, the gambling operator would have an accurate record of every transaction.

Sports betting winnings are subject to the same 24% federal tax rate as other gambling winnings.

The winners are also responsible for paying the applicable local taxes.

The current NJ tax rate is 8.5% for retail sportsbook wins and 13% for wins at online sportsbooks or on mobile apps.

Whether or not the place where the winning occurs reports it to the IRS, keep in mind, these winnings are taxable income. Therefore, it is a gambler’s responsibility to report them and pay any associated taxes.

As with any type of gambling winnings, if you itemize your deductions on your tax return, you can deduct your documentable losses. However, your reported losses cannot exceed your reported winnings.

Taxpaying rules for professional gamblers

If gambling is the way you earn your living, different rules and guidelines apply in determining your tax liability.

So, if you are a professional poker player, blackjack player or sports bettor, proceeds from gambling are considered regular earned income from self-employment and taxed accordingly.

When filing your tax return, you must complete Schedule C, not Schedule A.

Here, you would name gambling as your business and deduct any gambling losses and other gambling-related costs as business expenses.

For example, you can deduct the cost of travel to a gambling facility, including the expenses associated with attending out-of-town gambling seminars and conferences. Also, you can deduct the costs for tournaments and handicapping contests.

You can also deduct the fees you paid for professional services, part of your internet bill and the cost of any materials purchased to help make you a better gambler.

Accurate record-keeping for all gamblers is a must

Regardless of the type of gambling and whether it is a profession or recreational activity, there are benefits to keeping a betting diary.

Every time you gamble, record the date, place, type of bets made, and amount won or lost. This information will help you identify the types of situations that are the most profitable for you as well as others you should avoid.

Also, if you are over-betting your bankroll and need to cut down, your records will show you that as well.

Furthermore, no one wins 100% of the time.

If you have reportable gambling winnings, you may be able to reduce your tax liability if you show that you have incurred significant losses.

Besides a gambling diary, other types of acceptable documentation include:

Nj Sports Gambling Tax Refund

• Receipts
• Betting tickets
• Win-loss statements from gambling establishments