Colorado gambling winnings tax calculator
Colorado taxes gambling winnings as ordinary income at a flat 4.4%.
Updated · 2026 tax rules · How we calculate
You keep
$8,010
Cash at payout
$7,200
Total tax
$1,990
Over-withheld
$810
- Form W-2G
- Yes
- Federal withholding at payout
- $2,400
- Federal tax on the winnings
- $1,550
- State tax
- $440
- Colorado withholding at payout
- $400
- Over-withheld
- $810
- You keep
- $8,010
$10,000 is at or above the $2,000 reporting threshold, so the payer files a W-2G with the IRS and gives you a copy.
The payer holds back 24% of winnings over $5,000 and sends it to the IRS. It's a prepayment, not the final tax.
Winnings are ordinary income stacked on your other $60,000. Your top dollar lands in the 22% bracket.
Colorado taxes gambling winnings as ordinary income.
Colorado requires the payer to hold back 4% for state tax.
More was withheld than these winnings add to your tax. The difference reduces what you owe on the rest of your return, or comes back as a refund.
$10,000 minus $1,990 in federal and state tax: an effective rate of 19.9%.
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.
How Colorado taxes gambling winnings
- State income tax
- Colorado taxes gambling winnings as ordinary income at a flat 4.4%.[1]
- Gambling losses
- Losses reduce Colorado tax only through your federal itemized deductions. Colorado has no separate gambling-loss deduction.[2] How the federal 90% loss rule works
- Withholding
- Payers withhold 4% on winnings paid in Colorado whenever federal withholding applies, whether or not you live in Colorado.[3]
- Nonresidents
- Yes. Winnings from gambling conducted in Colorado, including the Colorado Lottery, are Colorado-source income for nonresidents.[4]
- Tax paid to other states
- Yes. Residents get a credit for tax paid to another state on income from sources there.[2]
- Legal gambling
- Sports betting: legal online and in person. State lottery: yes. Casinos: yes. Online casino: not legal.[5]
Also worth knowing
- Colorado treats in-state gambling winnings as Colorado-source for nonresidents 'regardless of whether the nonresident was present in Colorado' when the game was played or paid.[4]
- From 2026, taxpayers with AGI over $300,000 must add back federal itemized or standard deductions above $1,000 ($2,000 joint), which largely wipes out the Colorado benefit of gambling losses.[2]
- Colorado's 4% withholding generally doesn't apply to bingo, keno or slot jackpots, because federal withholding generally doesn't apply to them.[2]
Examples by game
For a single filer with $60,000 of other income and no gambling losses, living and winning in Colorado. Colorado ranks 23rd of 51 for what you keep from a $10,000 sports bet, and 23rd of 51 for a $1 million lottery prize. See every state ranked.
| Game | Won | Withheld | Federal tax | State tax | You keep |
|---|---|---|---|---|---|
| Sports betting | $10,000 | $2,800 | $1,550 | $440 | $8,010 |
| Casino and slots | $5,000 | $0 | $600 | $220 | $4,180 |
| Table games | $5,000 | $0 | $600 | $220 | $4,180 |
| Poker tournaments | $20,000 | $0 | $3,750 | $880 | $15,370 |
| Lottery | $50,000 | $14,000 | $10,350 | $2,200 | $37,450 |
| Daily fantasy sports | $5,000 | $0 | $600 | $220 | $4,180 |
| Horse racing | $8,000 | $2,240 | $1,110 | $352 | $6,538 |
Questions
- Does Colorado tax gambling winnings?
- Yes, at a flat 4.4%.[1]
- Can you deduct gambling losses in Colorado?
- Losses reduce Colorado tax only through your federal itemized deductions. Colorado has no separate gambling-loss deduction.[2]
- Does Colorado withhold tax from gambling winnings?
- Payers withhold 4% on winnings paid in Colorado whenever federal withholding applies, whether or not you live in Colorado.[3]
- Do nonresidents pay Colorado tax on gambling winnings?
- Yes. Winnings from gambling conducted in Colorado, including the Colorado Lottery, are Colorado-source income for nonresidents.[4]
Gambling across the border from Colorado
Win in a neighboring state and both states can tax it: the state you won in as a visitor, and Colorado as your home state, usually with a credit for the tax you paid there.
Sources
- [1] Tax Foundation, State Individual Income Tax Rates and Brackets, 2026 · checked September 22, 2026
- [2] Colorado DOR Individual Income Tax Guide · checked September 22, 2026
- [3] Colorado DOR Withholding Tax Topics: Gambling Winnings · checked September 22, 2026
- [4] Colorado DOR Income Tax Topics: Part-Year Residents & Nonresidents · checked September 22, 2026
- [5] American Gaming Association, State of the States 2025 · checked September 22, 2026
- [6] ADOR Private Taxpayer Ruling LR99-012 (1999) · checked September 22, 2026
- [7] Kansas 2025 Individual Income Tax booklet (K-40 instructions) · checked September 22, 2026
- [8] Nebraska DOR Regulations Chapter 22 (REG-22-003.01I) · checked September 22, 2026
- [9] 2025 PIT-B Instructions, Line 7 · checked September 22, 2026
- [10] Oklahoma Tax Commission, 2025 Legislative Update · checked September 22, 2026
- [11] 2025 Oklahoma Form 511-NR Packet (Oklahoma Tax Commission) · checked September 22, 2026
- [12] EY Tax News, Utah law lowers state income tax rate retroactive to January 1, 2026 · checked September 22, 2026
- [13] Utah Constitution Art. VI, Sec. 27 · checked September 22, 2026