Poker tournaments winnings tax in Alabama
Alabama taxes poker tournament winnings as ordinary income at graduated rates from 2% to 5%.
Updated · 2026 tax rules · How we calculate
You keep
$15,250
Cash at payout
$20,000
Total tax
$4,750
Due when you file
$4,750
- Form W-2G
- Yes
- Federal withholding at payout
- $0
- Federal tax on the winnings
- $3,750
- State tax
- $1,000
- Still to pay when you file
- $4,750
- You keep
- $15,250
$20,000 is at or above the $2,000 reporting threshold, so the payer files a W-2G with the IRS and gives you a copy.
Poker tournaments winnings aren't subject to regular federal withholding, whatever the amount. Tax is still owed when you file. If you don't give the payer your Social Security number, 24% backup withholding applies.
Winnings are ordinary income stacked on your other $60,000. Your top dollar lands in the 22% bracket.
Alabama taxes gambling winnings as ordinary income.
Tax owed ($4,750) minus what was withheld ($0). Set this aside. A large balance can also mean an underpayment penalty unless you make an estimated payment.
$20,000 minus $4,750 in federal and state tax: an effective rate of 23.8%.
An estimate for 2026, not tax advice. It treats this win as your only gambling income for the year and leaves out local income taxes. Nothing you enter leaves your browser.
The rules
- Alabama tax
- Alabama taxes poker tournament winnings as ordinary income at graduated rates from 2% to 5%.[1]
- Federal tax form
- Poker tournament winnings of $2,000 or more, net of the buy-in, are reported on a W-2G. No 300x test applies.[2]Unverified
- Federal withholding
- Poker tournament winnings aren't subject to regular withholding if the payer files a W-2G and gives you a copy.[2]Unverified
- Alabama withholding
- No Alabama withholding requirement for poker tournament winnings. Tax is due when you file.[3]Unverified
- Gambling losses
- You can deduct losses only as an Alabama itemized deduction (Schedule A, line 25), up to the gambling winnings you report.[4]Unverified
- Visitors
- Alabama taxes nonresidents on poker tournament winnings won there, so visitors may need to file a nonresident return.[5]
- Where to play
- Alabama has casinos.[3]
What you keep at different amounts
For a single filer with $60,000 of other income and no gambling losses, living and winning in Alabama.
| Won | W-2G | Withheld | Federal tax | State tax | You keep |
|---|---|---|---|---|---|
| $1,500 | No | $0 | $180 | $75 | $1,245 |
| $2,000 | Yes | $0 | $240 | $100 | $1,660 |
| $10,000 | Yes | $0 | $1,550 | $500 | $7,950 |
| $20,000 | Yes | $0 | $3,750 | $1,000 | $15,250 |
| $100,000 | Yes | $0 | $22,114 | $5,000 | $72,886 |
Questions
- How much is Alabama tax on poker tournament winnings?
- Alabama taxes poker tournament winnings as ordinary income at graduated rates from 2% to 5%.[1]
- Does Alabama withhold tax from poker tournament winnings?
- Alabama has no withholding requirement for poker tournament winnings. Tax is due when you file.[3]Unverified
- Do visitors pay Alabama tax on poker tournament winnings?
- Alabama taxes nonresidents on poker tournament winnings won there, so visitors may need to file a nonresident return.[5]
More for Alabama
All of Alabama's gambling tax rules · Poker tournaments in every state
Sources
- [1] Tax Foundation, State Individual Income Tax Rates and Brackets, 2026 · checked September 22, 2026
- [2] IRS, Instructions for Forms W-2G and 5754 (01/2026) · checked September 22, 2026
- [3] AGA State of the States 2025 (legal status as of Dec. 31, 2024) · checked September 22, 2026
- [4] Alabama 2025 Form 40 Booklet (Schedule A line 25 instructions) · checked September 22, 2026
- [5] Alabama 2025 Form 40NR Booklet · checked September 22, 2026