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WinningsTax

New Jersey gambling winnings tax calculator

New Jersey taxes gambling winnings as ordinary income at graduated rates from 1.4% to 10.75%.

Updated · 2026 tax rules · How we calculate

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$
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More options
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You keep

$7,898

Cash at payout

$7,300

Total tax

$2,103

Over-withheld

$598

Form W-2G
Yes

$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.

Federal withholding at payout
$2,400

The payer holds back 24% of winnings over $5,000 and sends it to the IRS. It's a prepayment, not the final tax.

Federal tax on the winnings
$1,550

Winnings are ordinary income stacked on your other $60,000. Your top dollar lands in the 22% bracket.

State tax
$553

New Jersey taxes gambling winnings as ordinary income.

New Jersey withholding at payout
$300

New Jersey requires the payer to hold back 3% for state tax.

Over-withheld
$598

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.

You keep
$7,898

$10,000 minus $2,103 in federal and state tax: an effective rate of 21%.

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 New Jersey taxes gambling winnings

State income tax
New Jersey taxes gambling winnings as ordinary income at graduated rates from 1.4% to 10.75%.[1]
Lottery prizes
New Jersey Lottery prizes of $10,000 or less are exempt, including Powerball and Mega Millions tickets bought in New Jersey. Larger prizes and all out-of-state lottery prizes are taxable.[2]
Gambling losses
You can subtract gambling and lottery losses from the same year from your winnings on NJ-1040 line 24 without itemizing, down to zero. The federal 90% limit doesn't apply.[2]
Withholding
Casinos and sportsbooks withhold 3% from payouts for residents and nonresidents. The New Jersey Lottery withholds 5% from prizes over $10,000 and 8% from prizes over $500,000.[3]Unverified
Nonresidents
Nonresidents owe New Jersey tax on gambling winnings from a New Jersey location and file Form NJ-1040NR.[3]
Tax paid to other states
Residents can claim a credit (Schedule NJ-COJ) for income taxed by both New Jersey and another jurisdiction, limited to the New Jersey tax on it.[2]
Legal gambling
Sports betting: legal online and in person. State lottery: yes. Casinos: yes. Online casino: legal.[4]

Also worth knowing

  • Gambling losses can offset winnings on the NJ-1040 without itemizing, but a net gambling loss can't be reported or used against wages or other income.[2]
  • Technical Bulletin TB-20(R) is the Division of Taxation's detailed guidance on gambling winnings and losses.[2]

Examples by game

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

GameWonWithheldFederal taxState taxYou keep
Sports betting$10,000$2,700$1,550$553$7,898
Casino and slots$5,000$0$600$276$4,124
Table games$5,000$0$600$276$4,124
Poker tournaments$20,000$0$3,750$1,139$15,111
Lottery$50,000$14,500$10,350$3,050$36,600
Daily fantasy sports$5,000$0$600$276$4,124
Horse racing$8,000$2,160$1,110$442$6,448

Questions

Does New Jersey tax gambling winnings?
Yes, at graduated rates from 1.4% to 10.75%. New Jersey Lottery prizes of $10,000 or less are exempt, including Powerball and Mega Millions tickets bought in New Jersey. Larger prizes and all out-of-state lottery prizes are taxable.[1]
Can you deduct gambling losses in New Jersey?
You can subtract gambling and lottery losses from the same year from your winnings on NJ-1040 line 24 without itemizing, down to zero. The federal 90% limit doesn't apply.[2]
Does New Jersey withhold tax from gambling winnings?
Casinos and sportsbooks withhold 3% from payouts for residents and nonresidents. The New Jersey Lottery withholds 5% from prizes over $10,000 and 8% from prizes over $500,000.[3]Unverified
Do nonresidents pay New Jersey tax on gambling winnings?
Nonresidents owe New Jersey tax on gambling winnings from a New Jersey location and file Form NJ-1040NR.[3]

New Jersey by game

Sources

  1. [1] Tax Foundation, State Individual Income Tax Rates and Brackets, 2026 · checked September 22, 2026
  2. [2] 2025 NJ-1040 Instructions, Line 24 · checked September 22, 2026
  3. [3] NJ Division of Taxation - Lottery and Gambling Winnings · checked September 22, 2026
  4. [4] NJ Division of Gaming Enforcement · checked September 22, 2026