Gambling winnings tax in Illinois

Illinois taxes your gross gambling winnings and allows no deduction for losses, so a losing year can still produce a state tax bill.

Checked against Illinois’s own sources on 2026-09-11.

In short

A win that takes your federal AGI to more than $250,000, or $500,000 if you file jointly, costs you all of the Illinois exemption.10, 9
For casino, track and sports wagering, Illinois withholds only on winnings of more than $5,000, and only where federal withholding applies.7

How Illinois treats gambling losses

Illinois does not let a casual gambler offset winnings with losses at all, so how you file federally makes no difference to the state figure.

The two examples below are the same numbers the calculator uses, worked at Illinois rates.

Two examples, worked at 2026 Illinois 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
Illinois: $2,475
Total: $6,071

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. Illinois starts from your federal income and allows no deduction for gambling losses, so the full $50,000 is taxed at 4.95 percent, which comes to $2,475.

A winning year

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

Federal: $10,350
Illinois: $2,475
Total: $12,825

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. Illinois starts from your federal income and allows no deduction for gambling losses, so the full $50,000 is taxed at 4.95 percent, which comes to $2,475.

Illinois income tax rates, 2026

2, 5

Taxable income	Rate
$0 and above	4.95 percent

The calculator also applies what this table leaves out: the personal exemption, which ends at higher incomes, taken before the table.

Withholding on winnings

5, 7

Illinois withholds 4.95 percent. The payout that triggers it depends on the wager, and the lowest trigger is $1,000. The rules in the state's sources:

the state lottery: $1,000 or more.
other lotteries, sweepstakes and wagering pools: above $5,000 (only where federal withholding applies).
pari-mutuel wagering, sports wagering and other wagers: above $5,000, and only where the payout is at least 300 times the stake (only where federal withholding applies).

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 Illinois

11, 12

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).

Illinois allows no loss deduction at all, so the federal limit changes your federal bill and not your Illinois bill.

Illinois follows the federal code as it changes. The paragraph above says what this means for the federal 90 percent limit.

If you do not live in Illinois

Illinois taxes nonresidents on Illinois lottery, casino, track and sports wagering winnings, including residents of reciprocal states. Illinois residents may claim a credit for tax paid to another state.

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

More about Illinois

Withholding

For casino, track and sports wagering, Illinois withholds only on winnings of more than $5,000, and only where federal withholding applies. The $1,000 line is for Illinois lottery winnings.7

Illinois does not withhold from gambling winnings that are subject to another state’s withholding.7

Losing the exemption at high incomes

For 2026 the Illinois exemption is $2,925 a person. You lose all of it once your federal AGI is more than $250,000, or $500,000 if you file jointly.10, 9

The 2025 exemption is $2,850.4

About this estimate

If you are 65 or older, the calculator takes off Illinois’ extra $1,000 exemption for each person 65 or older. Like the basic exemption, it is lost once federal AGI is over $250,000, or $500,000 joint.

The calculator estimates 2026 and uses the 2026 exemption of $2,925. The 2025 amount was $2,850.4, 10

Sources

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

1. 35 ILCS 5/204(d)(1): an additional exemption of $1,000 for a taxpayer, and a spouse, 65 or older, and 204(g): no exemption above AGI of $250,000, or $500,000 joint (checked 2026-10-12)
2. Form IL-1040 instructions (2025), income tax rate and federal AGI starting point (checked 2026-09-11)
3. Form IL-1040 instructions (2025), no property tax or K-12 education expense credit above $250,000 or $500,000 of federal AGI (checked 2026-09-25)
4. Form IL-1040 instructions (2025), personal exemption of $2,850 for tax year 2025, and none if your federal AGI is greater than $250,000, or $500,000 joint (checked 2026-10-11)
5. Booklet IL-700-T (2026), withholding tax tables, rate 4.95 percent (checked 2026-09-11)
6. Schedule M instructions, Illinois does not allow a deduction for gambling losses (checked 2026-09-11)
7. Publication 130 (R-02/26), withholding on Illinois lottery and gambling winnings (checked 2026-10-05)
8. Schedule NR instructions, Illinois source income for nonresidents (checked 2026-09-11)
9. 35 ILCS 5/204(g), no exemption above $250,000 or $500,000 of adjusted gross income (checked 2026-09-25)
10. 2026 Booklet IL-700-T, the exemption allowance is $2,925 (checked 2026-09-25)
11. 35 ILCS 5/1501(a)(11), the Internal Revenue Code as in effect for the taxable year (checked 2026-10-11)

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

12. 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)

We could not confirm these from an official source: whether any city or county tax applies.