March Madness comes around every year and generates a huge amount of buzz, this year, we may see a lot more. Now that mobile sports betting is becoming allowed in more and more states, we can expect a historic amount of wagers to be placed during the manic month of March.
Mobile Betting Becomes Mainstream
Sports betting is now legalized in 31 territories throughout the United States, with 11 more currently pending legislation. The AGA predicts a total of 45 million Americans to place bets throughout March Madness this year. They are predicting $3.1 billion in total wagers to be placed.
With the new market influx in the gambling space, such as the legalization of sports betting in New York, we can likely expect the biggest March Madness ever in terms of betting. To put things in perspective, the three major betting apps FanDuel, Caesar’s, and Draft Kings each made $100 million during this year’s Super Bowl, and that was only from New York. Additionally, New York reported that the state took in over $7.9 million in tax revenue from the Super Bowl; which can be compared to the projected $19 million in state tax revenue NY plans to collect from the NCAA Men’s Basketball tournament this year.
Brackets (Not the Tax Kind)
Each year, fans and bettors alike try to predict the entire tournament by filling out brackets with their predictions of who will win every game. No one has ever filled out the “perfect bracket” to this point, which has a prize of $1 billion. If you did, would you know what to do? I wouldn’t, but I do know one thing, the $1 billion is subject to a 24% federal tax rate, with an additional state tax added on (if applicable)! This means if someone fills out the perfect bracket, the IRS will be collecting almost $250 million in tax revenue.
Wrap Up
Betting on big events such as March Madness is becoming more mainstream online betting is making gambling more accessible and user-friendly. All Americans should know that gambling winnings need to be reported to the IRS during filing seasons, even if they are smaller than the $1 billion potential perfect bracket prize. Talk with your accountant to find out if your winnings need to be claimed today!
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