Sports Betting, Fantasy Football & Your Taxes: What You Need to Know in 2026

Football season is here, which means fantasy football leagues are in full swing, office pools are heating up, and plenty of fans are putting a little money on their favorite teams, players, and parlays.

The One Big Beautiful Bill Act changed the rules for gambling losses beginning in 2026, which means the tax treatment of your sports bets and fantasy winnings may look different this year.

Here’s what taxpayers should know before the season gets too far down the field.

Winnings Are Still Taxable

Whether your winnings come from a sportsbook, fantasy sports league, office pool, or another type of wager, gambling winnings are generally taxable income.

That means your $50 fantasy football payout, $500 parlay, or $5,000 championship pool win doesn’t simply go straight into your bank account tax-free. The IRS considers gambling and fantasy sports winnings taxable income.

And yes, that can be true even if you had plenty of losing bets throughout the year.

Wins and Losses Don't Play on the Same Team

Gambling winnings and losses are not netted together and reported as one net figure. Winnings are reported on Schedule 1 of Form 1040 as other income. Losses, on the other hand, are reported separately on Schedule A as an itemized deduction. Your app might show you a friendly “net profit” figure, but the IRS doesn’t accept that shortcut. Wins and losses each get their own uniform.

The Real Headline: Only 90% of Gambling Losses Count Now

Under the new rules, beginning with the 2026 tax year, deductible gambling losses are limited to 90% of your wagering losses, and the deduction is still limited to the amount of your gambling winnings.

Here’s an example:

Say you spend the football season betting on games, parlays, and fantasy contests. By the end of the year, you have:

• $10,000 in gambling winnings
• $10,000 in gambling losses

Economically, you broke even.

For tax purposes, however, you generally can’t deduct the full $10,000 of losses. The 2026 rules limit the deduction to 90% of your losses, or $9,000.

That could leave $1,000 of gambling income subject to tax, even though you broke even overall.

In other words, your betting record might say “even,” but your tax return may not.

Standard Deduction Filers: You're on the Sideline

There’s another important piece of the puzzle.

For casual gamblers, gambling losses are deductible only if you itemize deductions on Schedule A. If you take the standard deduction, you generally can’t claim a separate deduction for your gambling losses.

So, for example, someone could have $5,000 of gambling winnings and $5,000 of losses during the year but still have taxable gambling income, depending on their filing situation.

For many casual sports bettors and fantasy players, this makes keeping track of the numbers throughout the year especially important.

Fantasy Football Counts, Too

Fantasy football may feel more like a game of skill than traditional sports betting, but don’t assume that means the tax rules don’t apply.

The IRS specifically includes fantasy sports winnings among gambling winnings.

That means your fantasy football championship payout, paid league winnings, or other fantasy sports prize may have tax consequences.

So while you’re focused on waiver wire pickups and setting your lineup, don’t forget to keep track of the money going in and coming out of your league.

Forms and the Paper Trail

Taxpayers may receive Form W-2G for certain gambling winnings, depending on the type and amount of the wager. Don’t assume no form means no obligation; every dollar of gambling winnings is taxable whether or not a Form W-2G is received. And here’s the kicker: sportsbooks report your wins to the IRS, but they don’t report your losses. That gap is exactly why keeping your own game log — dates, bets, amounts, results — is your best defense at tax time.

And remember: the form you receive from a sportsbook, fantasy platform, or other payer may not tell the complete story of your wins and losses for the year.

Keep Your Own Scorecard

If you’re betting throughout the year, don’t rely solely on your sportsbook or fantasy app to keep track of your tax records.

The IRS recommends keeping an accurate record of gambling winnings and losses, including supporting documentation such as statements, tickets, receipts, or other records.

Consider keeping track of:

• Dates of wagers
• Type of wager
• Amount wagered
• Amount won or lost
• Sportsbook or fantasy platform used
• Account statements
• Relevant tax forms

Think of it as your season-long stat sheet — except this one matters when tax season rolls around.

Final Score

Sports betting and fantasy football can make an already exciting season even more entertaining, but don’t let tax implications catch you off guard.

For 2026:

• Winnings are taxable.
• Gambling losses are handled separately from winnings.
• Only 90% of qualifying gambling losses may be deductible, subject to the amount of gambling winnings.
• Losses generally provide a tax deduction only for taxpayers who itemize.
• And good records are essential.

So go ahead and celebrate the walk-off parlay, the fantasy championship, or the perfect Sunday slate, just remember that when the season ends, you may have one more score to settle: your tax return.