In a way sports betting is already legal, regulated and taxed. here’s why:
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Referencing Wikipedia
Sports bettors place their wagers either legally, through a bookmaker/sportsbook, or illegally through privately run enterprises. Many legal sportsbooks are found online, operated over the Internet from jurisdictions separate from the clients they serve, usually to get around various gambling laws in select markets, such as Las Vegas, Nevada, or on gambling cruises through self-serve kiosks. They take bets "up-front", meaning the bettor must pay the sportsbook before placing the bet. Illegal bookies, due to the nature of their business, can operate anywhere but only require money from losing bettors and don't require the wagered money up front, creating the possibility of debt to the bookie from the bettor. This creates a number of other criminal elements, thus furthering their illegality.
There have been a number of sports betting scandals, affecting the integrity of sports events through various acts including point shaving (players affecting the score by missing shots), spot-fixing (a player action is fixed), bad calls from officials at key moments, and overall match fixing (the overall result of the event is fixed).
According to CBS Sports
Most states prohibited sports betting, which left sports gambling legality up to a state-level government. Many states have legalized sports betting or are in the process of doing it.
Here's where the US stands on sports betting for each state, as of 2022.
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Legal:
Arizona
Arkansas
Colorado
Connecticut
Delaware
Illinois
Louisiana: Approved sports betting. Currently, mobile sports betting isn't offered in Louisiana.
Maryland
Michigan
Mississippi
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico: “Legal”.... Sports gambling is only legal at the Santa Ana Star Casino Hotel and four other tribal casinos.
New York
North Carolina
Ohio: Residents won't be able to place any wagers until Jan. 1, 2023 at the earliest.
Oklahoma: Legal, not yet launched.
Oregon
Pennsylvania
Rhode Island: Legal. online/mobile betting is still on its way.
South Dakota: In the 2020 election, South Dakota approved sports betting.There's no word when mobile sports betting will be available.
Tennessee
Virginia
Washington: Legal.Does not allow mobile/online wagering.
Washington D.C.
West Virginia
Wisconsin: Retail authorized. in-person and mobile app betting while at Oneida Nation gaming locations.
Wyoming
Not legal:
Alabama
Alaska
California: Not legal, but legislation proposed.
Georgia
Hawaii
Idaho
Indiana
Iowa
Kansas: Not legal, but legislation proposed.
Kentucky: Not legal, but legislation proposed.
Maine: Not legal, but legislation proposed.
Massachusetts
Minnesota
Missouri: Not legal, but legislation proposed.
North Dakota: Not legal, but legislation proposed.
South Carolina: Not legal, but legislation proposed.
Texas: Not legal, but legislation proposed.
Utah
Vermont: Not legal, but legislation proposed.
Florida: Sports betting was temporarily approved and legal, but now it is awaiting another launch due to a legal issue.
Florida lawmakers approved sports betting in 2021. Unfortunately, court lawsuits have delayed the official beginning of betting. Three weeks after being approved, a judge ruled that an agreement between the state and the Seminole Tribe was illegal. The Seminole Tribe and Hard Rock Sportsbook had launched online sports betting on Nov. 1, 2021, but the app was shut down due to the ongoing legal battle.
Legal Sports Betting states:
Countries With Legal Sports Betting
There are many countries all over the world offering legal sports betting to their residents. Global sports betting is a roughly $150 billion yearly industry, and dozens of countries have recognized or begun to recognize its potential economic benefits. Some companies from other countries have even parlayed all that experience into lucrative partnerships with U.S. based sportsbooks. The sports betting industry is constantly evolving and expanding all over the world.
Other countries with legal sports betting:
Argentina, Australia, Brazil, Canada, China, Colombia, Costa Rica, Ghana, India, Kenya, Mexico, New Zealand, Nigeria, Peru, Philippines, Russia, South Africa, United Kingdom.
As far as regulation goes, here’s what I’ve learned. According to Gambling Sites.org:
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Regulations are important for these reasons:
- To ensure gambling sites are operated lawfully
- To ensure gambling sites are operated ethically
- To ensure online gamblers are safe and treated fairly
To keep this section short and sweet, regulations are here for your safety and are absolutely (in my opinion) necessary to allow bettors a fair playing field.
Taxes are a must, here’s why:
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1040 website states
Sports gambling winnings are subject to income tax and you must report them on your tax return, even if you don’t receive tax documentation for the gambling income.
Gambling agencies aren’t required to report your winnings unless you win at least 300 times, what you bet and that amount is over $600 (or otherwise subject to federal income tax withholding). You are required to report any and all winnings on your personal tax return.
You may be required to pay estimated tax payments if the agency did not withhold Social Security or Medicare taxes.
Reporting your gambling winnings is simple; just find the “Other Income” line on your Form 1040 and report the amount there. If you lost money gambling, you may be able to deduct that amount—losses can be claimed as an itemized deduction on Schedule A.