Gambling winnings tax in the District of Columbia

The District of Columbia allows gambling losses only if you itemize on your federal return. Take the standard deduction and it taxes your gross winnings. Whether only 90 percent of your losses count from 2026 is not settled.

Checked against the District of Columbia’s own sources on 2026-10-09.

In short

When federal withholding applies to your winnings, the District withholds at its top rate, 10.75 percent, whatever your real tax bracket is. You get the excess back when you file the D-40.6, 3
If your District adjusted gross income is above $200,000, or $100,000 married filing separately, the 2025 D-40 worksheet cuts your itemized deductions, gambling losses included, by 5 percent of the income above that line. The D.C. Code exempts gambling losses from this cut, so the two disagree.12, 7
Under a 2026 law, the District standard deduction for 2026 is $15,000 single or married filing separately, $22,500 head of household and $30,000 joint, plus the federal amount for each person 65 or older. The 2026 D-40ES, printed before that law, gives the larger federal amounts.7, 2

How the District of Columbia treats gambling losses

4, 7

The District of Columbia allows the deduction only to filers who itemize on the federal return. Take the federal standard deduction and the offset disappears, so gross winnings are taxed even in a year you finished down.

The two examples below are the same numbers the calculator uses, worked at District of Columbia rates.

Two examples, worked at 2026 District of Columbia rates

A single filer with $60,000 of other income who takes the standard deduction on everything except gambling losses.

A losing year

You win $50,000 and lose $52,000, so you finish down $2,000.

Federal: $3,596
District of Columbia: $1,247
Total: $4,843

You finished the year down and still owe tax.

Federally you itemize, so your losses offset your winnings, but the 2026 rule caps that deduction at 90 percent and leaves $3,200 taxable. The District of Columbia allows the loss deduction only to filers who itemize federally, which you do. Your District of Columbia income, after the District of Columbia's standard deduction or your itemized deductions, whichever your federal return takes, goes from $45,000 without the win to $63,200 with it. The extra $18,200 is taxed at graduated rates, which comes to $1,247.

A winning year

You win $50,000 and lose $10,000, so you finish up $40,000.

Federal: $10,350
District of Columbia: $3,950
Total: $14,300

Federally you take the $16,100 standard deduction, which is worth more than itemizing, so your gambling losses do not reduce your federal tax at all. The District of Columbia allows the loss deduction only to filers who itemize federally, and you do not. Your District of Columbia income, after the District of Columbia's standard deduction or your itemized deductions, whichever your federal return takes, goes from $45,000 without the win to $95,000 with it. The extra $50,000 is taxed at graduated rates, which comes to $3,950.

District of Columbia income tax rates, 2026

Taxable income	Rate
$0 to $10,000	4 percent
$10,000 to $40,000	6 percent
$40,000 to $60,000	6.5 percent
$60,000 to $250,000	8.5 percent
$250,000 to $500,000	9.25 percent
$500,000 to $1,000,000	9.75 percent
$1,000,000 and above	10.75 percent

The calculator also applies what this table leaves out: the federal overall limit on itemized deductions at the top federal bracket, taken before the table.

Withholding on winnings

The District of Columbia withholds 10.75 percent. The payout that triggers it depends on the wager, and the lowest trigger is $5,000. The rules in the state's sources:

the state lottery and other lotteries, sweepstakes and wagering pools: above $5,000, measured after the stake comes off (the District states no figure of its own and defers to 26 U.S.C. 3402(q)).
pari-mutuel wagering, other wagers and sports wagering: above $5,000, and only where the payout is at least 300 times the stake, measured after the stake comes off.
slot machines, keno and bingo: nothing is withheld, at any amount.

These sources give no rule for other kinds of bet, so do not assume tax was withheld on one.

Withholding is a credit against the bill, not the bill itself. It does not settle what you owe.

The federal 90 percent loss limit in the District of Columbia

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From tax year 2026 the federal deduction for gambling losses is cut to 90 percent of what you lost, and never more than what you won. Public Law 119-21 did it, at section 70114(a), by rewriting 26 U.S.C. 165(d).

The District of Columbia has not said whether the federal 90 percent limit applies. Its own law measures the state deduction by the federal figure, so the limit can arrive without the District of Columbia doing anything. The District of Columbia follows the federal code as it changes.

Our estimate assumes the limit applies, which gives the higher tax. The calculator also shows the tax if the limit does not apply. We would rather tell you the number could be lower than let you plan around one that turns out to be too low.

If you do not live in the District of Columbia

The District does not tax nonresidents on District-source income. A nonresident with District withholding files Form D-40B to recover it.

The calculator works the bill for somebody who lives in the District of Columbia. It does not apportion income between states, so a nonresident return is not what the figure above describes.

More about the District of Columbia

The standard deduction for 2026

D.C. Law 26-189, in force from October 2, 2026 and applying from 2025, sets the District standard deduction for 2025 to 2029. It rises each year for the cost of living from a 2025 base year, so by our reading the first rise can come in 2027. It adds the federal amount for age, which the 2026 D-40ES gives as $1,650 for each married person 65 or older, or $2,050 if you are unmarried. For 2026 the basic amount is:7, 2

Filing status	2026 basic amount
Single	$15,000
Married filing separately	$15,000
Head of household	$22,500
Married filing jointly	$30,000

The 2026 D-40ES, printed on April 1, 2026, before that law, gives the federal amounts: $16,100 single, $24,150 head of household and $32,200 joint. As of October 9, 2026, the District had not published a form or notice under the new law.2

Withholding

When federal withholding applies to your winnings, the District withholds at its top rate, 10.75 percent, whatever your real tax bracket is. You get the excess back when you file the D-40.6, 3

If you itemize

On the 2025 D-40 worksheet you remove all state and local taxes on Schedule A line 7, then add back real estate taxes from line 5b in full and other taxes from line 6. So the worksheet removes income or sales taxes and personal property taxes, though D.C. Code 47-1803.04(d) bars only income taxes among these. No 2026 D-40 is published.4, 7

The District reduces your itemized deductions by 5 percent of District adjusted gross income above $200,000, or $100,000 married filing separately. D.C. Code 47-1803.04(c)(2) exempts gambling losses from this reduction, but the 2025 D-40 worksheet does not, so it reduces them. The two disagree.12, 7

Rate bands

Every filing status uses the same seven rate bands. A married couple gets no wider bands.3

Local tax

The District is one taxing area. You pay no separate local income tax.

About this estimate

The calculator uses $15,000, $22,500 and $30,000 for 2026, plus the federal amount for age when you enter an age of 65 or older. If the District applies the larger D-40ES amounts instead, a losing year that makes you itemize can cost more than the calculator shows.

The calculator does not include the District’s own 5 percent reduction of itemized deductions, which comes after the federal overall limit on itemized deductions (IRC 68).7

Sources

Every figure above traces to a primary source: a statute, an administrative code, a state agency page, or official form instructions.

1. DC Office of Tax and Revenue, Schedule H: up to $1,425, federal AGI of $90,000 or less at 70 or older, for 2025 (checked 2026-10-12)
2. 2026 Form D-40ES booklet, printed before D.C. Law 26-189, the standard deduction at the federal amounts (checked 2026-09-25)
3. D.C. Code 47-1806.03, imposition of tax and rate table (checked 2026-09-11)
4. Form D-40 booklet (2025), itemized deductions and the 5 percent reduction (checked 2026-09-11)
5. D.C. Code 47-1801.04(28), rolling conformity to the Internal Revenue Code (checked 2026-09-25)
6. D.C. Code 47-1812.08, withholding on lottery and wagering winnings at the top rate (checked 2026-09-15)
7. D.C. Law 26-189, Fiscal Year 2027 Budget Support Act of 2026, subtitle I, enrolled text: 47-1803.04, deductions to the same extent as on the federal return, which carries in the federal limit of IRC 68, the 5 percent reduction and the federal choice, and the basic standard deduction in 47-1801.04(3A) (checked 2026-10-09)
8. D.C. Code 47-1803.03(b) and (b-4), as the Council code site still shows them. D.C. Law 26-189 repeals both from 2025 and moves the rules to 47-1803.04 (checked 2026-10-09)
9. D.C. Code 47-1803.03, editor's note on D.C. Law 26-89 of February 12, 2026, a temporary 225-day amendment. The section it created, 47-1803.04, no longer loads on the Council code site (checked 2026-10-01)
10. Public Law 119-78, disapproving the D.C. Income and Franchise Tax Conformity and Revision Temporary Amendment Act of 2025 (checked 2026-09-25)
11. D.C. Attorney General opinion, February 24, 2026: the temporary act remains in effect to its expiry and is not, at present, expected to govern 2026 tax (checked 2026-09-25)
12. 2025 Form D-40 booklet, Calculation F, the 5 percent reduction of itemized deductions (checked 2026-09-24)
13. D.C. Code 47-1803.03(b), repealed by D.C. Law 26-189 from 2025: deductions "shall be the same (and to the same extent) as the deductions allowed by the Internal Revenue Code of 1986" (checked 2026-10-09)

The federal rule, for the parts of this page that rest on it

14. Public Law 119-21 section 70114(a), which rewrote 26 U.S.C. 165(d) on wagering losses from tax year 2026 and sets out its text (checked 2026-10-18)
15. 26 U.S.C. 3402(q)(3)(A), withholding on wagering proceeds, and 26 U.S.C. 3402(q)(5), which exempts slot machines, keno and bingo, 2024 edition of the US Code (checked 2026-10-18)