A win equivalent to 300 times a wager or amounts to $600 is subject to tax. The IRS receives a copy of the W-2G for winnings categorized as taxable. The source of the win is negligible, you can win online or at a physical establishment yet you must pay tax since it's an income. Even earnings still in an online wallet are taxable.A tax charge of 24% is due on all gambling earnings. This may be more depending on the state of the winner. Additional tax from the state law will add to what is already paid as federal tax. By default, sportsbooks often automatically deduct the 24% tax charge from the source. However, based on the tax bracket of an individual, there may be a need to pay more or receive a tax refund. Irrespective of the amount won, or if the W-2G is received or not, the winning must be reported on the tax returns and must be done accurately.On the 1040 form, gambling wins can be recorded as other income. All records should be kept accurately, using the suggestion from IRS, keeping a daily record of gambling activities helps to note every important thing. All gains and losses will be readily available should the need to take deductions suffice. A proper record includes all the W-2G forms for the tax year.