(The Center Square) – Legal betting nationwide for Sunday’s 59th Super Bowl between the Eagles and Chiefs is expected to generate a record-setting $1.5 billion or more in what will be North Carolina’s first time with legal wagers.
Rep. Erin Paré, R-Wake, hopes to bring the state in line in another way, too, offering a proposal for sports gambling losses to be deducted on taxes. It is at the federal level and in most states.
“This bill conforms North Carolina law to federal law and seeks to prevent confusion and surprise tax bills,” Paré says. “The vast majority of states that have legal sports betting allow this deduction capped at winnings.”
Gambling Losses Tax Deduction, also known as House Bill 14, would become retroactive to Jan. 1, 2024, if signed into law. Given such a move was supported by the last Democratic governor, the legislation has high probability to become law.
North Carolina, like every state in the South sans Florida, Tennessee and Texas, has a state income tax. To deduct gambling losses, a filer would have to be itemizing and exceeding the amounts of the standard deduction.
Single filers standard deduction is $12,750, and married filing jointly is $25,500.
Under current format, two taxpayers could each win $100,000 in sports gambling – the first without losses, the second with $100,000 in losses for a net $0. The winnings – gross not net – of each are treated equally for tax purposes.
North Carolina is the 38th state to allow legal sports wagering. Promotionals, like when it debuted on March 11 of last year just before March Madness, are flooding in from multiple sportsbooks.
More than $5 billion has been wagered, yielding more than $105 million to state coffers. The gross wagering revenue – amounts received by interactive sports wagering operators from sports wagers as authorized under state law, less the amounts paid as winnings before any deductions for expenses, fees or taxes – is multiplied by 18% to give the state its take.
Through the first 296 days ending Dec. 31, North Carolina is averaging a gain of $354,919 per day on the $105,056,250 total.
