Social bettors might not be aware of the situation regarding Sportzino taxes, so I’ve put this guide together to help. As Sportzino is a social sportsbook, you might not think tax would be a concern – but you’d be wrong.
While Sportzino does not use real money, any SC redemptions you make are likely to be subject to tax. Sportzino will not be involved directly, so this means you’ll have to work out your own Sportzino taxes on your tax return to the IRS. This guide will explain which forms you need to help you stay legit.
Sportzino taxes pros and cons
- SC redemptions are not taxed at Sportzino
- SC winnings are only a tax concern when you redeem them
- Use Sportzino account activity to track redemption totals
- Have to complete tax forms yourself
Why is there confusion about Sportzino taxes?
If Sportzino was a regular ‘real money’ sportsbook, then it would be easy to get your head around why you would have to pay taxes on your winnings, but Sportzino is not a regular sportsbook. Instead of cash, it uses two virtual currencies called Gold Coins and Sweeps Coins. You can see how they both work in my companion guide? – What are
Sportzino coins?
This is where the confusion comes in – if the coins aren’t real and you can wager socially for free – what do taxes have to do with any of it? One of the features of Sweeps Coins is that, when certain criteria are met, you can redeem them for a real world prize, and that when the issue of Sportzino taxes needs to be addressed.
Do you pay taxes on Sportzino?
So, the short answer to this is yes, but of course, there’s more to it. Before I go any further I need to be clear that the only taxable factor here is your SC redemptions, and none of this applies to any winnings you happen to have from just making social bets using either type of virtual coin.
Does Sportzino charge taxes?
The first big takeaway is that Sportzino will not deduct tax from any of your winnings. When you read the T&Cs before signing up you’ll see it clearly stated, but the short version here is that it’s all up to you. Federal taxes on winnings over $600 are the same whether you are at a ‘real money’ platform like BetMGM or Bet365 or sweepstakes sites like Sportzino. There are exceptions to every rule though, and if you are in either
- Alaska
- Florida
- Nevada
- South Dakota
- Texas
- Wyoming
State taxes are not payable on sweepstakes winnings. You would also be exempt in Washington, but as Sportzino cannot operate there, the point is moot. If that wasn’t complex enough, you also need to be aware that different
Sportzino legal states
tax at different amounts – here are some examples:
| State | Tax rate |
| Nevada | 6.75% |
| Iowa | 6.75% |
| Tennessee | 20% |
| New York | 51% |
| Rhode Island | 51% |
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Making SC redemptions at Sportzino
Before you get to this stage, you will need to successfully redeem Sweeps Coins from Sportzino. To do this you need to:
- Meet the playthrough requirement for your Sweeps Coins
- Have collected enough redeemable Sweeps Coins
- Passed KYC verification
Here’s how these requirements work in detail:
- Playthrough requirements –
the default for Sportzino is usually 1x, but that can vary according to the promotion. The key here is to read the T&Cs so you know what to do. Some offers might have 2x or greater playthrough requirement, especially some of the promotions you might see on social media giving away free coins.
- SC balance requirement –
this is the minimum number of redeemable SC that can have to be collected before a redemption can be requested. It is currently 50 SC, although there are also maximum amounts as well. The most you can redeem in 24 hours is 9550 Sweeps Coins, except for New York and Florida, where it is 4900 SC.
- KYC Verification –
this can hold up your SC redemption if you don’t follow the rules correctly so this should not be rushed. Here you need to prove you are who you say you are, your
Sportzino age
and your location. This is done by providing ID like a passport or driving license as well as something like a bank statement or tax return. You’ll need to upload copies of these and have them approved before your SC redemption can proceed.
Once you have ticked all of these boxes you can request a SC redemption and wait for the funds to hit your account. The timescale will vary according to which method you have chosen, but typically it should be in your bank or eWallet within 3-5 working days.
It is important that you keep a record of all of your SC redemptions so you can pay any Sportzino taxes, although you’ll also be able to see them in your account activity at Sportzino. This will make life easier when you come to declare all of this to the IRS.
It’s also worth noting that since Sportizino is a sweepstakes brand, there are no
Sportzino withdrawal
or deposits here. If you’re looking for how to withdraw from Sportzino, the closest thing you’ll find is how to make an SC redemption.
How to report your Sportzino taxes
If you have made SC redemptions at Sportzino, you will need to report these to avoid fines, penalties or any other sanctions that the IRS might impose. Doing this will be different at Sportzino from a regular sportsbook.
?? You will not receive a Form W-2G for your Sportzino Taxes
If you have been registered at a regular sportsbook or casino before you might already know that they are likely to send you IRS Form W-2G if you have had winnings in the previous tax year. They will even fill in the amount that you need to report on your tax return as income. The bad news is that Sportzino does not do this, so it is all entirely left up to you.
?? Use form 1040 to declare your Sportzino Taxes
Instead of using a W-2G form, you’ll have to use the 1040 form which you might know is the form U.S. taxpayers like you use to file their annual income tax return. This is divided into a number of sections, and you’ll need to declare it under the ‘other income’ section. This will include any winnings from Sportzino you have redeemed, so ensure you get it right. Not declaring any winnings can get you in trouble with the IRS, so make sure you scour your records to ensure you have not missed anything. Alternatively, over declaring can mean you end up paying too much tax, which nobody wants to do.
?? Get qualified help if you need it
If you are a regular bettor and made plenty of optional GC purchases and SC redemptions over the course of a year, then this might not be something you want to do yourself. With quite a lot at stake if you get it wrong one way or the other, you might want to get an accountant involved to make sure that what you are declaring is correct. This way you have peace of mind – but regardless of whether you do it or you get professional help – you still need to pay Sportzino taxes.
Make sure to report your Sportzino SC redemptions
The tax regulations regarding any type of sportsbook can be complicated, and this is especially true for sweepstakes sportsbooks like Sportszino. Any social wagers made and won using your Gold Coins and Sweeps Coins are not a problem, but any funds you receive as part of a SC redemption will be subject to state and federal taxes, at a rate that will vary according to which state you are in. The biggest takeaway here is that declaring that is all on you, and completing the relevant forms for your Sportzino taxes is essential to ensure you are using Sportzino safely and legally.
Sportzino taxes FAQs
?? Do you have to pay taxes on Sportzino?
You need to pay taxes on SC redemptions from Sportzino, but they do not issue you with a 2-WG. You’ll have to declare those winnings on your regular tax return and pay the appropriate amount which will vary from state to state.
?? What is the threshold for federal taxes at Sportzino?
The federal tax threshold for redeemed winnings at Sportzino is the same as it would be for any regular or sweepstakes sportsbook at $600. There can also be state taxes depending on where you happen to be.
?? Are taxes payable on virtual coins at Sportzino?
No. Your social bets with virtual coins are not subject to tax, but any amount of SC you redeem will have to be declared. Sportzino do not record these, this is all left up to you.
Many sportsbooks will send you a form if you have had winnings during the year, but that does not happen here. Sportzino will not send you a 2-WG, so you or your accountant will need to add any Sportzino SC redemptions to your regular 1040 tax form.
