Since this value is below the $600 threshold for federal tax, you will only need to pay state tax. According to the paytable, you should get a $100 prize. Let’s imagine that you’ve played the PA Powerball and correctly guessed four white numbers. The following table outlines state and federal tax on lottery winnings: This means that even Powerball or Mega Millions in PA are subject to the same taxes on lottery winnings in the State. As long as you’re participating in a draw that’s sold to you through an authorized ticket vendor, including the Pennsylvania online lottery site, any winnings are subject to the same gambling tax. Pennsylvania is home to a number of state-based lotteries as well as multi-state draws. Calculating Gambling Tax by Activityĭetermining if your winnings are subject to gambling taxes can be confusing, so to simplify matters, we’ve outlined when and how much taxes are due according to the gambling activity. Gambling taxes are due on winnings from all these types of activities, and these are generally a state tax of 3.07% and a federal tax of 24%. Since 2017, you can also enjoy online gambling in PA using both websites and mobile apps. If you are located in the State and are over the legal gambling age, you can play the lottery and casino games and bet on sports. Pennsylvania is one of the most liberal US states for gambling. In this guide, we’ve explained everything you need to know about taxes on gambling winnings.

Moreover, you only need to pay federal tax if your winning exceeds a certain threshold. The good news is that Pennsylvania has one of the lowest tax rates in the country. Whether playing online casino games, betting on sports, or participating in the lottery, you’ll need to pay State and possibly federal governments some money. Gambling taxes are the unfortunate repercussion of scoring a payout.

Pennsylvania legalized gambling revenue