Delaware Sports Betting

Delaware is giving Las Vegas a good run for its money. On a Tuesday afternoon recently, the tiny state located on the Eastern Seaboard started offering full-scale sports betting, becoming the very first state to take advantage of the Supreme Court’s decision that was decided only recently. It effectively strikes down a 1992 federal law that had banned commercial sports betting in almost all US states. Gamblers can now stake single-game bets on professional sports including baseball, football, hockey, basketball, soccer, golf and even auto racing. In-game bets and wagers that are placed while play is ongoing will not be permitted, however. On 14th May 2018, the Supreme Court finally overturned the antiquated Professional and Amateur Sports Protection Act, which had primarily prohibited all sports betting outside of the state of Nevada, citing the law as unconstitutional. With this seminal decision, the Supreme Court finally opened the doors to legalising an estimated $150 billion of illegal wagers that are placed on professional and amateur sports by Americans every year. Delaware’s geographical position is ideal for drawing in visitors from other major cities. Delaware is reasonably close to Philadelphia, Baltimore as well as Washington. However, it may soon face stiff competition from other East Coast states. New Jersey and also Pennsylvania are expected to follow suit very soon, as are the states of West Virginia and Mississippi. The expected changes include the following. The First State, which already allows multi-game betting on professional football, will now start allowing gamblers to bet on single games on a wide variety of professional sports. If more than $5,000 is won from gambling activities, one can expect the casino to withhold 24 per cent of the total for tax purposes. The IRS will surely want a piece of the action! Basically, the total amount of gambling winnings, less the losses, is tacked on to all other income the players have and is taxed as regular income. This was reported by Bill Smith, the managing director of CBIZ MHM's National Tax Office based in Washington. This move came just three weeks after the U.S. Supreme Court had struck down a previous 1992 federal law that had banned sports betting in all states that did not already have a specific law on their books. Delaware had already arranged a partial exemption from that law and already offer parlay betting, and multi-game betting on professional American football. Gamblers in Delaware will now be permitted to wager on single games as well as championships on a broad variety of professional sports, that includes baseball, football, hockey, basketball, soccer, golf and even auto racing, as reported by the governor's office. Although this is typically a much slower time of the year for sports betting, gamblers are now able to bet on NBA championship series and also the Stanley Cup hockey finals, both of them are currently underway. As for taxation of bettors winnings, the brand new taxation law already came into effect earlier this year, and it continues to permit winners to deduct any gambling related losses, up to the corresponding amount of gambling income. This will be as long as they itemise all the deductions rather than using the standard deduction method. The information will be reported on Form 1040, put down as "other income." In comparison, the standard deduction method has almost doubled for taxpayers, and most deductions have been eliminated; therefore, few taxpayers will be expected to have enough deductions to make itemising worth its while. Professional gamblers, on the other hand, will face some additional rules for 2018 up until 2025. When expenses are deducted, such as travelling to and fro a casino, must be added to any gambling losses made when calculating the total value of the tax deduction, rather than just writing them off separately as a reasonable business expense. Generally speaking, if the winnings are in excess of $5,000, the casino is required by law to withhold any federal taxes. Effective this year, the withholding rate is 24 per cent, which is down from the previous rate of 25 per cent. However, one must not assume that the amount withheld is what is actually owed. Since an online casino does not know if one makes $2,000, or $26 million a year, they will have to withhold at that specific rate; however, they do not know what tax bracket someone is in. Taxes might also be withheld on any winnings of less than $5,000 for specific situations. They could include if the amount won is 300 times the original bet, for instance. That would equate to a $600 win on a $2 bet. Additionally, depending on how much anyone wins, they will receive the Form W-2G from the casino itself, even if one does not, the IRS will still expect the individual to pony up everything at tax collection time!