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Taxes on gambling winnings in sports

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Poker and online gambling
Poker and online gambling © charles taylor/Shutterstock.com

Poker is viewed by many as a game rather than a sport, although poker tournaments have shown up on sports cable channels. However you characterize it, poker's popularity is growing. It's a particular favorite of online players.

For many years, online gambling, including poker, was the target of federal prosecutors. Under the Unlawful Internet Gambling Enforcement Act, Internet gambling sites were effectively shut down. The biggest strike against poker came in 2011 when an FBI sting operation closed the three largest online poker sites for violating Internet gambling prohibitions.

States are still allowed, however, to set their own online gambling laws. So far Nevada, New Jersey and Delaware have officially legalized online gambling, including poker playing.

Meanwhile, legislation has been introduced in Congress to legalize online gambling in general by Rep. Peter King, R-N.Y., and Internet poker in particular by Rep. Joe Barton, R-Texas.

The reason for this shift at state and federal levels? Once again, it's money. Dr. Kahlil Philander of the University of Nevada Las Vegas has researched the U.S. online poker market and says it could be worth more than $2 billion a year.

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