Hello,
I am wondering how sports betting is taxed if you play on websites like FanDuel/BET/Draftkings.
I need an answer to all 3 questions below.
1. Do you only report when you withdraw to your bank account, or do you report every time you win? So i could bet let's say $600, turn that into $3000, but keep that $3,000 in my DraftKings account never withdraw it and continue placing bets with that balance. Do i have to report my $+2,400 winnings if i don't withdraw them?
1. Casino. Please bare with my example.
You deposit $1,000, and you keep playing poker for weeks on DraftKings, you never make a single withdrawal, you keep losing bets, and winning bets, with that initial $1,000 you deposited. The amount of money you have wagered across these last few weeks amounted to $50,000, but really your balance never changed from around $1,000. You could have placed a $1,000 bet, won +1,000, but then you place another $1,000 bet, and lost, and now you are back at $1,000, and you keep playing with this style over and over and eventually your total bets reaches $50,000 overall. Out of that $50,000 though you are actually at a loss with just $400 remaining, and you decide to cash it out.
Do you report your winnings of $50,000 to the IRS or do you report $400, or do you simply not report anything since your initial deposit was $1,000, but you withdrew $400.
2. Sports Betting (Very similar question).
You deposited $1,000, you keep winning and losing bets, but you never withdraw and your total bets placed over the year is $30,000, but in reality you never withdrew and your balance stays around $1,500. Do you have to report the $30,000?
