PA casinos will have to pay a 36% tax on winnings to the state Sports bettors are generally subject to a flat 24% tax but tack on 3.07% more in PA Neighboring NJ casinos pay the state just shy of. There is zero business opportunity if the online gambling tax rate goes above 20 percent. There is zero incentive for casinos to pursue such a business. That is particularly the case when Pennsylvania is charging an upfront licensing fee of $8 million. You will have to pay state income tax on your winnings in 39 states. If you live in one of the 11 states that don’t tax sweepstakes prizes, you may be spared state income taxes. Casinos in Pennsylvania pay a tax rate of 55 percent on slots, video poker, and electronic table games. Live poker and table games have a tax rate of 16 percent. Charities may apply for a bingo license. These cost $100 and are active for one year. Bingo games may have no prize larger than $250 for a single game except for the jackpot drawing.

• Year Pennsylvania Regulated Gambling: Horse racing (1963), Lottery (1972), Bingo (1981), Slot Casinos (2004), Table Games (2010)
• Estimated Tax Revenue from Gambling: $2.8 billion
• Estimated Gambling Revenue: $6.8 billion
• Pennsylvania Gambling Age: 18 for lottery, bingo, and racing, 21 for casinos
• Smoking ban: Pennsylvania permits casinos to set aside a percentage of the floor for smoking areas
• Online gambling status: Horse racing is the only form of legal online gambling

Pennsylvania is the second largest casino state in terms of gambling revenue. Most of the state’s casinos are racetracks with attached casinos. There are three resort-style Pennsylvania casinos. Those offer fewer slots than the main gaming establishments in the state. This is unusual compared to most other states where casinos offer amenities. Most Pennsylvania casinos offer little more than gambling on slots, video poker, and table games.

Casinos are not the only forms of Pennsylvania gambling within the state. There is a state lottery that sells instant games and holds lotto drawings. There are live horse racing and off-track betting. Charities may hold limit games of chance to raise funds.

Paying Gambling Taxes in Pennsylvania

Do you have to pay taxes on your gambling winnings? OnlineUnitedStatesCasinos has gathered everything you need to know about paying taxes on your gambling winnings straight from a Certified Public Accountant. For more information please visit our exclusive Gambling Taxes article.

Pennsylvania Casinos Map & Guide

• Harrah’s
• Parx Casino
• Rivers Casino
• Sands Bethlehem
• Sugarhouse Casino

• Number of B&M Casinos: 12
• Number of Poker Rooms: 10
• Number of Indian Casinos: 0

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Types of Pennsylvania Online Gambling Allowed

There is only one form of legalized online Pennsylvania gambling. That is off-track betting on horses. Sites like TVG, TwinSpires, and XpressBet partnered with Pennsylvania tracks to offer this service over the Internet and on mobile apps.

Daily fantasy sports sites claim to be legal in Pennsylvania. There is no law on the books that expressly states that. The companies claim to be skill gaming sites. There are bills under consideration by the Pennsylvania Legislature that would make daily fantasy sports a regulated and legal activity. DraftKings, FanDuel, CBS Sports, and Yahoo! are among the sites that accept Pennsylvania players.

Types of Live Pennsylvania Gambling

• Slots: Yes
• Blackjack: Yes
• Poker: Yes
• Craps/Roulette: Yes
• Horses: Yes
• Lottery: Yes

Pennsylvania gambling offers nearly every form of betting they want in the state. Pennsylvania casinos started out only offering slots, video poker, and electronic table games. That expanded to live poker, blackjack, craps, roulette, and nearly any house-banked card game one can imagine. There are 12 Pennsylvania casinos with one more in the planning stage.

Pa Tax Rate On Gambling Winnings Losses

There are seven racetracks in Pennsylvania. These offer live racing and race books. These tracks moved into the casino business. That helped keep the racing industry above water.

The Pennsylvania Lottery sells scratch-off tickets and lotto drawings. These are available at thousands of convenience stores across the state. There are Pennsylvania-only lotto drawings that include Pick 2, Pick 3, Pick 4, Pick 5, Cash4 Life, Cash5, and Match 6. The Pennsylvania Lottery also participates in multi-state lottery drawings. These are Powerball and Mega Millions.

Bingo is permissible if spread by a charity. There are more than a dozen licensed bingo halls in the state.

Pennsylvania Gambling Laws

The Pennsylvania Gaming Control Board is permitted to issue 14 casino licenses. Seven were guaranteed to the state’s racetracks. There were five standalone Pennsylvania casino licenses awarded. Two resorts receive licensure. A third resort will receive a license in 2017 to bring the total to 15 Pennsylvania casinos within its borders.

Casinos in Pennsylvania pay a tax rate of 55 percent on slots, video poker, and electronic table games. Live poker and table games have a tax rate of 16 percent.

Charities may apply for a bingo license. These cost $100 and are active for one year. Bingo games may have no prize larger than $250 for a single game except for the jackpot drawing. That bingo game may have a $2,000 prize pool. The largest amount of money that may be awarded in one day by a bingo charity is $4,000. Bingo halls may not spread more than two nights of action a week. Exceptions are made for charities that only hold annual celebrations. These nonprofit groups can hold 10 consecutive days of bingo games.

The Pennsylvania Lottery may only spread two types of games. One is instant games, sometimes referred to as scratch-off tickets. The other is lotto drawings. The Pennsylvania Lottery holds its own drawings as well as joins multi-state pools.

Pa Tax Rate On Gambling Winnings Real Money

Horse racing is active in Pennsylvania. Seven tracks are licensed to offer live races. Each has a race book. Horse racing tracks may partner with online betting apps for remote wagering. Players may make deposits and withdrawals at the partner tracks.

The minimum Pennsylvania gambling age is 18 years of age, except for casinos, where the minimum gambling age is 21. Bingo participants may be under 18 if accompanied by an adult.

List of Pennsylvania Casinos

There are 12 Pennsylvania casinos open and currently operating. Seven are at racetracks that also offer live and simulcast betting, and the rest are casino resorts.

History of Pennsylvania Gambling

Horse racing was the first form of legalized gambling in Pennsylvania. Its regulation started in 1964. The racing industry dated back more than 200 years before that. Dozens of tracks operated off the book races where the betting was handled through underground networks. It took until 1964 for the state to determine it was better off regulating and taxing the racing industry than to let it operate without any oversight.

The Pennsylvania Lottery was created by Act 91 on August 26, 1971. The first lottery ticket was sold on March 7, 1972. It was a half-dollar drawing with a $1 million grand prize. The Pennsylvania Lottery joined interstate drawings on June 27, 2002.

The Racehorse Development and Gaming Act was signed into law by Governor Ed Rendell on July 5, 2004. This permitted racetracks to add slots, video poker and electronic table games. It was created to help save the state’s racing industry. Table games and live poker were added in January 2010.

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The new table games helped Pennsylvania’s gambling industry explode. The state surpassed New Jersey as the second highest state in terms of gaming revenue in 2012. Pennsylvania has retained that title ever since. Nevada is the only state with more gaming revenue than Pennsylvania.

Pennsylvania looked again to expand gambling in 2013. This time, it was over the Internet. Multiple attempts have included online poker and casino games. None has reached the assembly or senate floor for a vote.

The Pennsylvania Legislature is also looked to expand gambling to daily fantasy sports in 2016. Those talks have also failed to produce a new law regulating and taxing the contests.

Pennsylvania Casinos & Gambling FAQ

The minimum Pennsylvania gambling age is determined by the types of gambling they want to use. Lottery and racing players must be at least 18. Pennsylvania casino players must be 21 years of age or older. Bingo players must be at least 18 unless accompanied by a parent or guardian.

Slots, video poker, electronic table games, live poker, blackjack, baccarat, Pai Gow, Three Card Poker, Four Card Poker, Ultimate Texas Hold’em, Let it Ride, Mississippi Stud Poker, Texas Hold’em Bonus and Caribbean Stud Poker are among the approved games at Pennsylvania casinos.

Yes. All seven horse racing tracks in Pennsylvania offer race books.

The only form of online gambling legal in Pennsylvania is off-track betting on horses.

State law does not cover daily fantasy sports. Sites like DraftKings, FanDuel, CBS Sports and Yahoo! claim that the contests are skilled games.

Pennsylvania generates more gaming revenue than any other state except Nevada.

The Pennsylvania Lottery sells scratch-off and lotto tickets.

Players dream of hitting a big jackpot when they play the slots. When that day comes for you, you'll have questions about the taxes you must pay on the winnings.

Hand Pay Jackpots

When you hit the winning combination of symbols for a large jackpot, your slot machine locks up. Depending on the machine, the lights on top of the machine may come on and start flashing, music may play or bells ring. A slot attendant arrives promptly to see what you have won.

On jackpots smaller than $5,000, an attendant verifies that you hit the jackpot and then assists you in claiming your money at the cashier's cage. In the case of a large or progressive jackpot, the casino may have technicians come and check the machine to certify that it was functioning properly when the jackpot hit. If you hit one of the wide-area progressive machines such as MegaBucks, the slot company that operates the game comes out and verifies that machine before giving you a check.

When you hit a jackpot, you have the option of taking your winnings in cash or check. Usually, large amounts are paid by check. In the case of the MegaBucks or similar multi-million dollar jackpots, you receive a check for the partial amount, and then you have 90 days to decide if you want to be paid a lump sum or an annual annuity on the balance. If you select the lump sum option, you receive only a percentage of your actual winnings. For example, the full winnings of one multi-million slot jackpot is paid in 25 annual installments, or you can take a lump sum of 60 percent of the winnings.

IRS Withholding

All casino winnings are subject to federal taxes. However, the IRS only requires the casinos to report wins over $1,200 on slots and ​video poker machines or other games such as keno, lottery or horse racing. When you have a win equal to or greater than $1200, you are issued a W-2G form. This form lists your name, address and Social Security number. The casinos are not required to take out withholding tax on jackpots under $5,000 as long you supply your Social Security number. If you don’t provide your Social Security number, the casinos withhold 28 percent on small jackpots.

You can request a specific amount of withholding tax to be taken out of any jackpot you win. Some players like to do this to avoid a big tax payment in April when they file their income tax returns. The additional withholding may not be necessary if you keep a log book. The law allows you to deduct gambling losses up to the amount of your winnings. You can only do this if you have documentation of your losses. Keeping a diary or log book is the way to do this.

Proper Identification

Casinos can refuse to pay you until you produce proper identification—a photo ID such as a driver’s license, military ID or passport.

If you don’t produce an ID, you are photographed and the casino holds your winnings until you come back with proper ID. For this reason, you should always carry a valid form of identification with you when you visit the casino.

When the casino checks your identification, it also checks your age to make sure you are legally old enough to play. The minimum age for gambling varies from state to state, but under-age gamblers are not be paid if they hit a jackpot. This is the law in all jurisdictions, and it has been upheld in court.

Pa Tax Rate On Gambling Winnings Money

Plan Ahead

Before you start playing your favorite slot machine you should have a plan for the day you hit a jackpot. Players become excited when they hit the big one, and this may affect the decisions you make about your winnings. It is helpful if you know ahead of time how much withholding you want taken out or whether you want a check for all or some of the amount.