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WinningsTax

Casino and slots winnings tax in Kentucky

Kentucky taxes slot machine winnings as ordinary income at a flat 3.5%.

Updated · 2026 tax rules · How we calculate

$
$
$
More options
$

You keep

$4,225

Cash at payout

$5,000

Total tax

$775

Due when you file

$775

Form W-2G
Yes

$5,000 is at or above the $2,000 reporting threshold, so the payer files a W-2G with the IRS and gives you a copy.

Federal withholding at payout
$0

Casino and slots 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.

Federal tax on the winnings
$600

Winnings are ordinary income stacked on your other $60,000. Your top dollar lands in the 12% bracket.

State tax
$175

Kentucky taxes gambling winnings as ordinary income.

Still to pay when you file
$775

Tax owed ($775) minus what was withheld ($0). Set this aside. A large balance can also mean an underpayment penalty unless you make an estimated payment.

You keep
$4,225

$5,000 minus $775 in federal and state tax: an effective rate of 15.5%.

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

Kentucky tax
Kentucky taxes slot machine winnings as ordinary income at a flat 3.5%.[1]
Federal tax form
Slot machine and bingo winnings of $2,000 or more are reported on a W-2G, without subtracting the wager. The threshold was $1,200 before 2026. Keno is also $2,000, after subtracting the wager on the winning game.[2]
Federal withholding
Slot machine, keno and bingo winnings are exempt from regular gambling withholding by statute, whatever the amount.[4]
Kentucky withholding
No Kentucky withholding requirement for slot machine winnings. Tax is due when you file.[5]Unverified
Gambling losses
If you itemize, you can deduct wagering losses allowed under federal law, including the 90% limit, even though Kentucky disallows most other itemized deductions.[6]
Visitors
Kentucky taxes nonresidents on slot machine winnings won there, so visitors may need to file a nonresident return.[7]Unverified
Where to play
Kentucky has no casinos. Winnings from a casino trip to another state are still taxable here.[8]

What you keep at different amounts

For a single filer with $60,000 of other income and no gambling losses, living and winning in Kentucky.

WonW-2GWithheldFederal taxState taxYou keep
$1,500No$0$180$53$1,268
$2,000Yes$0$240$70$1,690
$5,000Yes$0$600$175$4,225
$10,000Yes$0$1,550$350$8,100
$100,000Yes$0$22,114$3,500$74,386

Questions

How much is Kentucky tax on slot machine winnings?
Kentucky taxes slot machine winnings as ordinary income at a flat 3.5%.[1]
Does Kentucky withhold tax from slot machine winnings?
Kentucky has no withholding requirement for slot machine winnings. Tax is due when you file.[5]Unverified
Do visitors pay Kentucky tax on slot machine winnings?
Kentucky taxes nonresidents on slot machine winnings won there, so visitors may need to file a nonresident return.[7]Unverified

More for Kentucky

All of Kentucky's gambling tax rules · Casino and slots in every state

Sources

  1. [1] Tax Foundation, State Individual Income Tax Rates and Brackets, 2026 · checked September 22, 2026
  2. [2] IRS, Instructions for Forms W-2G and 5754 (01/2026) · checked September 22, 2026
  3. [3] Federal Register, REG-113229-25 proposed rule (Apr. 17, 2026) · checked September 22, 2026
  4. [4] 26 U.S. Code § 3402 (withholding) · checked September 22, 2026
  5. [5] KRS 154A.110 Prizes taxable -- Withholdings from prize · checked September 22, 2026
  6. [6] KRS 141.019 Calculation of adjusted gross income and net income (effective July 15, 2026) · checked September 22, 2026
  7. [7] KRS 141.020 Levy of income tax on individuals · checked September 22, 2026
  8. [8] Covers, Legal sports betting in the US · checked September 22, 2026