(NewsNation) — Since states started legalizing sports betting in 2018, tens of thousands of people have failed to declare their winnings, costing the government nearly $1.5 billion in uncollected taxes, a new report said.
According to the Treasury Inspector General for Tax Administration, “148,908 individuals who were issued Forms W-2G with a total amount of more than $15,000 per individual in gambling winnings … did not file a tax return. These nonfilers were associated with approximately $13.2 billion in total gambling winnings.”
The report partially blames the Internal Revenue Service for the uncollected taxes, noting that about two-thirds of the identified nonfilers never received any sort of notice.
The report also said the IRS hasn’t established a process for monitoring the transactions of online sports books, and that hundreds of W-2G forms (“Certain Gambling Winnings”) lacked taxpayer identification numbers.
The report’s recommendations include going after those who failed to report gambling winnings from 2018 to 2020, the first three years after the U.S. Supreme Court struck down the 1992 Professional and Amateur Sports Protection Act.
It also calls on the IRS to expand its regulatory language to specifically include sports betting.
