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WinningsTax

New Mexico gambling winnings tax calculator

New Mexico taxes gambling winnings as ordinary income at graduated rates from 1.5% to 5.9%.

Updated · 2026 tax rules · How we calculate

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More options
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You keep

$7,980

Cash at payout

$7,000

Total tax

$2,020

Over-withheld

$980

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
$470

New Mexico taxes gambling winnings as ordinary income.

New Mexico withholding at payout
$600

New Mexico requires the payer to hold back 6% for state tax.

Over-withheld
$980

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
$7,980

$10,000 minus $2,020 in federal and state tax: an effective rate of 20.2%.

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 Mexico taxes gambling winnings

State income tax
New Mexico taxes gambling winnings as ordinary income at graduated rates from 1.5% to 5.9%.[1]
Gambling losses
Gambling losses count only through your federal itemized deductions, which New Mexico copies from your Form 1040, so the 90% limit carries over.[2]
Withholding
Racetracks, casinos, the state lottery and bingo operators withhold a flat 6% whenever they must withhold or report the winnings federally, for residents and nonresidents.[3]
Nonresidents
Nonresidents must report New Mexico gambling winnings on Schedule PIT-B and can't offset them with gambling losses there.[4]
Tax paid to other states
Residents can claim a nonrefundable credit for tax paid to another state on income both states tax, attaching the other state's return.[2]
Legal gambling
Sports betting: legal in person only. State lottery: yes. Casinos: yes. Online casino: not legal.[5]

Also worth knowing

  • Nonresidents can't offset New Mexico gambling winnings with gambling losses on Schedule PIT-B.[4]
  • Nonprofit bingo operators, not just casinos, racetracks and the lottery, must withhold New Mexico tax on winnings (FYI-104).[3]

Examples by game

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

GameWonWithheldFederal taxState taxYou keep
Sports betting$10,000$3,000$1,550$470$7,980
Casino and slots$5,000$300$600$235$4,165
Table games$5,000$0$600$235$4,165
Poker tournaments$20,000$1,200$3,750$940$15,310
Lottery$50,000$15,000$10,350$2,405$37,245
Daily fantasy sports$5,000$0$600$235$4,165
Horse racing$8,000$2,400$1,110$376$6,514

Questions

Does New Mexico tax gambling winnings?
Yes, at graduated rates from 1.5% to 5.9%.[1]
Can you deduct gambling losses in New Mexico?
Gambling losses count only through your federal itemized deductions, which New Mexico copies from your Form 1040, so the 90% limit carries over.[2]
Does New Mexico withhold tax from gambling winnings?
Racetracks, casinos, the state lottery and bingo operators withhold a flat 6% whenever they must withhold or report the winnings federally, for residents and nonresidents.[3]
Do nonresidents pay New Mexico tax on gambling winnings?
Nonresidents must report New Mexico gambling winnings on Schedule PIT-B and can't offset them with gambling losses there.[4]

New Mexico by game

Sources

  1. [1] Tax Foundation, State Individual Income Tax Rates and Brackets, 2026 · checked September 22, 2026
  2. [2] 2025 PIT-1 Instructions, Line 12 · checked September 22, 2026
  3. [3] FYI-104 New Mexico Withholding Tax (Rev. 11/2025, effective Jan 1, 2026) · checked September 22, 2026
  4. [4] 2025 PIT-B Instructions, Line 7 · checked September 22, 2026
  5. [5] Fox Sports, Where is sports betting legal? · checked September 22, 2026