It was back in 1995 when the first online betting site accepted it’s the first wager. From this point onwards, the number of legal betting sites in the USA didn’t stop growing. The industry has grown into an industry that was worth $155 billion in 2019 and has become a staple part of the enjoyment many fans take from sports events.
The evolution of the sports betting industry has seen the introduction of live betting and a variety of complex wagers brought about by an ever-growing community of players. Bettors have an array of legal betting sites at their fingertips.
Bettors often wonder where to find the best legal sports betting sites, which is something we’ll go into detail about here – answering all questions regarding legality and discussing betting regulations that are in place to ensure our readers have the best betting experience possible!
As it stands, there is no US federal law against gambling online – certainly, as a player, sportsbooks may break the law, but that isn’t of much concern to our readers. The laws in the US are quite loose, which means at a federal level, gambling online is perfectly legal due to the lack of a law against it.
Some years ago, US attorney Catherine Hanaway admitted in a courtroom that just placing wagers online as a punter doesn’t violate federal law and won’t justify a case for the prosecution. As of today, (July 1, 2020) no American has ever been arrested, indicted, or prosecuted by the feds for gambling online, simply due to the fact punters can’t be prosecuted for a non-existent law.
While this is true, the fact that the laws regarding online gambling remain relatively unclear, or unannounced, it means that there always remains a question as to the legality. With so many great online betting sites available, it’s important to choose the right provider and certainly one that is legal and follows the correct protocols.
Back in 2007, there were rumblings from Congress about the legality of online gaming. While this sent a message to the gambling industry, the reports were unfounded and swiftly forgotten. There was also a statement released by the FBI in 2007 stating that online gambling was illegal. However, it was found that they’d lied.
While bettors can break any federal laws from wagering, it’s not legal to run a gambling operation, except the states in the US that do not allow gambling outright; Utah and Hawaii.
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The first and most common question is regarding legal sports betting sites and whether winnings from these sites are taxable or not. The answer is yes. Gambling winnings are much like any other earnings. If the earnings go beyond a certain value it’s common for the gambling site, or casino to report the winnings themselves. However, this isn’t always the case and something bettors should check out and be aware of when playing.
It’s imperative that every player is able to deduct gambling losses from their tax declaration. Players that wager with Bitcoin betting sites will face the same taxation laws that players depositing using a more mainstream payment method like PayPal would be under. In order to do this, bettors must deduct gambling losses and provide records that show the amounts of both your winnings and losses; this can be done using casino or online betting receipts, tickets, and statements.
It’s important we emphasize the importance of recording movements of money with regard to gambling. While these rules don’t concern casual bettors, who simply have a flutter on the horses now and again, or place accumulators on the weekend. It does concern the more hardcore players. Gamblers that are invested in the business of gambling, who use it as a primary income, must be aware of declaring these funds or they may get caught out by the taxman.
There are winners and losers in gambling. But even winners can become losers if they don’t pay their taxes. All gambling winnings are generally subject to a flat 24% tax. While this is true, there is a threshold which must be exceeded in order to trigger the necessity to pay tax.
Any gambling winnings that go beyond $5,000, with regard to players involved in sweepstakes, wagering pools (including poker payments), lottery., or any other wager that exceeds 300 times the amount of the bet.
Equally, if an online user wins a non-cash prize, such as a car, boat, or trip, they will be responsible for paying taxes on the fair market value of each prize. While this may seem excessive to some, these strict rules regarding taxation in the US ensure the legality of gambling is untouched. In the case a bettor has wagered with an online legal betting site, they’ll be sent a W2-G form from the payer.
In the US, the question of how much money should be paid as taxes on winnings relates almost entirely to the amount of money. However, gambling winners in Canada can win millions of dollars and never have to pay a penny. The question of great value is about whether you’re a professional gambler making a living from the industry, or just a punter enjoying playing the odds for recreational value.
Taxation isn’t concerned with online and offline gambling, the rules apply the same to both types of gambling. The only exception to the rule is online poker, which is considered professional gambling. The skill component attached to poker means players must pay tax on winnings.
While many bettors in the UK wager regularly on a range of different types of betting markets, these players are entirely exempt from having to pay any form of tax. There is no tax to pay at all on either gambling winnings or stakes in the UK.
The British government will take any opportunity to squeeze even a pound out of citizens, which won’t surprise you to hear that these laws weren’t always this way. The change came into force in 2001, when Gordon Brown decided to make the change – the law came into effect on January 1st, 2002.
The lack of taxation regarding gambling winnings is one of the main reasons gambling is so popular in Great Britain.
It is said that Australia has one of the highest rates of gambling in the world, with an estimated 80% of adults engaging in gambling of some sort. Each region in Australia has its own laws and regulations regarding gambling. But, generally speaking, players don’t have to pay tax on winnings.
Australia has its own laws when it comes to charging tax. Operators are asked to front the money, with the amount of tax being dictated by the type of game and location. For players of online casinos and sportsbooks, the only charges they may incur are fees that are attached to deposits and withdrawals, which may go towards the tax payments said sportsbook pays. But this is unconfirmed.
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There are hundreds of legal betting sites in operation and bettors are gifted with an array of betting sites to choose from – but how much are the government taking from the winners?
Well for most nations across the world, nothing. While in the US, the government is taking a 24% tax on most winnings. This seems to be a unique case and one which must frustrate punters in the states. Gambling in countries like Canada, the UK, and Australia don’t follow the same rules, allowing players to enjoy 100% of their winnings online, or in the casino.