North Carolina Lawmakers Demand Sportsbooks Report Bettors Who Win $2K for Tax Purposes
Posted on: June 26, 2026, 08:17h.
Last updated on: June 26, 2026, 08:17h.
- North Carolina lawmakers approved a bill requiring sportsbooks to report customers who win at least $2,000 annually to the state tax department
- The measure comes after lawmakers also voted to raise the state’s online sports betting tax from 18% to 23%
- Critics warn the changes could push bettors toward offshore sportsbooks and prediction markets, where they face fewer state taxes and reporting requirements
Lawmakers in North Carolina are tightening their grip on the state’s sports betting industry, passing legislation to increase taxes on gross revenue and now telling sportsbooks they must report bettors who win $2,000 a year for tax purposes.
This week, Senate Bill 595 cleared the North Carolina General Assembly, with a 27-18 vote in the Senate and 106-11 tally in the House. The bill was presented to Gov. Joel Stein (D) this morning.
SB595, should Stein sign, would allow the NC Department of Revenue to demand that an online sportsbook provide the state tax agency with information on all customers who won at least $2,000 in the prior calendar year.
“An interactive sports wagering operator must provide the information to the DOR Secretary when the Secretary requests the information,” the bill reads.
The sportsbook would need to include the sports bettor’s name, tax identification number, mailing address, and “any other information that identifies a registered player.” The customer’s betting win/loss statement would also need to be supplied.
‘Insane’ Bill
While most states permit individuals filing itemized tax returns to deduct their gambling losses against their winnings, North Carolina does not. With the federal government still set to restrict the gambling loss deduction to 90% for the 2026 tax year, a change from 100% that came in the Republicans’ One Big Beautiful Bill Act, opponents to SB595 say North Carolinians are being especially penalized for participating in the state’s legal, regulated sports betting industry.
Insane,” summarized the Fairplaygov X account, a policy research handle focused on sports betting and prediction market regulations.
“NC bettors are already not allowed to deduct losses at all from winnings on their state tax returns and are capped at deducting 90% of losses on their federal returns. With this precedent-setting provision, the Secretary of State can request win/loss reports from mobile operators and determine whether taxpayers are accurately reporting,” Fairplaygov wrote.
“Most losing bettors don’t bother reporting, so people generally roll their eyes on these issues. But now NC DOR will know that you were supposed to report, and even worse, it starts with last year,” Fairplaygov continued.
Driving Bettors Offshore
Compounding concerns in the sports betting market is that North Carolina lawmakers increased the state’s tax on sportsbooks from 18% to 23% in the state’s recent budget, though the spending plan hasn’t yet passed. Those higher operating costs could be passed on to consumers in the form of tightened odds and scaled-back promotions and incentives.
If Stein signs SB595, which could require a sports bettor who wins $2,000 during the year but also loses $2,000 to pay state tax on $2,000 in phantom income, federally regulated sports prediction markets and offshore sportsbooks could become more attractive. Since prediction markets and offshore sportsbooks don’t pay state tax, nor would be subject to SB595, the platforms could be a refuge from lawmakers’ heavy hand in Raleigh.
The Sports Betting Alliance believes the state needs to quickly reverse course on sports betting.
“We urge state leaders to instead focus on strengthening the legal framework that protects players, supports jobs, and keeps illegal and unregulated operators out of North Carolina,” said the advocacy dedicated to legal, regulated online sports betting and online gaming.
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