Let’s face it, the United States sports gambling industry is complex and the rules are constantly changing. Though we are as thorough as possible in the information we provide, sometimes it helps to just get down to the basics. That is why we have compiled a list of the most frequently asked questions about legal sports betting. These are the comments and concerns that we commonly get in our inbox from readers, in one easy-to-digest format. Our running list of sports betting FAQs will help you to better navigate the legal betting world.
Will I Go To Jail For Online Sports Betting?
No, you will not go to jail for online sports betting. Even in states that don’t offer legal online sports betting, international gambling websites are legal because they fall outside state jurisdiction. Additionally, anti-gambling laws are written to target providers rather than individual gamblers. No individual has ever gone to jail in the United States just for betting on sports.
How old do I have to be to use legal online sportsbooks?
Every state sets its own laws governing age requirements for sports betting, but with international online sports betting sites, the legal sports betting age to play is 18 years old. You do not have to show a valid ID to sign up, but you do have to present proof of a valid, government issued ID before you can withdraw your winnings. Failure to do so will result in forfeiture of said winnings.
Is it legal to Bet On Sports With My Friends In The USA?
Some states do have prohibitions against social betting, but these are generally archaic laws that were simply never taken off the books. States do not enforce these social betting laws unless there’s some other criminal act involved. Your March Madness office pool or your friendly Sunday wager are completely legal. You can also legally bet with your friends using online sportsbooks.
Can I safely wager on sports with a local bookie?
No, for one, betting with an underground bookie is against the law. While you won’t be prosecuted simply for placing a bet, betting with a local bookie puts your money at risk of government seizure. Two, local bookies shouldn’t be trusted in general, as they will usually give you worse odds and their payouts are unreliable at best. If you want to wager on sports, do so either through a state or internationally regulated sportsbook.
Can I use the phone or Internet to place a bet at a sportsbook in another state?
No, all sportsbooks in the United States are off-limits to bettors physically located in another state. This is the result of the Federal Wire Act of 1961, which has since been re-interpreted to apply to domestic online sports betting. The Wire Act does not apply to international online sports betting.
Of course, all of this applies only to domestically-based, state-licensed sportsbooks. You can use offshore sports betting sites regardless of which state you live in, and you are not violating the Wire Act (or any other law) in doing so.
When Will My State Have Legal Sports Betting?
Unless you live in Utah, soon. Since the 2018 Supreme Court decision to strike down PASPA, states around the country have been passing legislation to legalize retail and online sports betting. While some states have seen heavy opposition to legal sports betting (usually either from religious groups or tribal casino representatives), it is likely only a matter of time until most states have legal sports betting.
Do I have to pay taxes on my winnings when betting on sports?
Yes, you absolutely have to pay federal and (when applicable) state taxes on your gambling winnings. Failure to report gambling winnings on your taxes constitutes felony tax evasion and is prosecutable under the law. The federal gambling winnings tax rate is 25%, while many states also charge gambling winnings as income. Gambling losses are also generally deductible up to the same amount as your winnings.
