Gambling winnings tax in New York

New York allows gambling losses only as an itemized deduction on the state return, whether or not you itemize federally. Take its standard deduction and it taxes your gross winnings.

Checked against New York’s own sources on 2026-09-16.

In short

  • If your New York adjusted gross income is above $1,000,000, your gambling losses give you no New York deduction. A large win can put you over that line by itself.3
  • The IT-196 instructions say your New York gambling loss deduction uses the federal rules that applied to tax year 2017.7, 6
  • For 2026 only the first five New York rates fall, each by a tenth of a point. So if you have a large win, your New York tax is almost the same as in 2025.

How New York treats gambling losses

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New York does not tie the deduction to your federal itemizing choice. You can itemize on the New York return even if you take the federal standard deduction, but the losses count only if you do, in place of New York's standard deduction.

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

Two examples, worked at 2026 New York 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
New York
$589
Total
$4,185

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. New York lets you deduct gambling losses as an itemized deduction on the state return, whether or not you itemize federally. Your New York adjusted gross income, which includes the winnings, takes $2,500 off the gambling loss deduction. Your New York income, after the larger of the standard deduction and your itemized deductions, goes from $52,000 without the win to $62,500 with it. The extra $10,500 is taxed at 5.4 percent, plus $22 the state adds on top, which comes to $589.

A winning year

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

Federal
$10,350
New York
$2,745
Total
$13,095

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. New York lets you deduct gambling losses as an itemized deduction on the state return, whether or not you itemize federally. Your New York adjusted gross income, which includes the winnings, takes $500 off the gambling loss deduction. Your New York income, after the larger of the standard deduction and your itemized deductions, goes from $52,000 without the win to $100,500 with it. The extra $48,500 is taxed at graduated rates, plus $27 the state adds on top, which comes to $2,745.

New York income tax rates, 2026

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Single filer thresholds. Married filing jointly and head of household use different bands. Married filing separately uses the single bands.

Taxable incomeRate
$0 to $8,5003.9 percent
$8,500 to $11,7004.4 percent
$11,700 to $13,9005.15 percent
$13,900 to $80,6505.4 percent
$80,650 to $215,4005.9 percent
$215,400 to $1,077,5506.85 percent
$1,077,550 to $5,000,0009.65 percent
$5,000,000 to $25,000,00010.3 percent
$25,000,000 and above10.9 percent

The calculator also applies what this table leaves out: a supplemental tax that takes back the lower brackets.

Withholding on winnings

5, 9, 10

New York withholds 10.9 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: above $5,000, measured after the stake comes off.
  • pari-mutuel wagering, sports wagering and other wagers: above $5,000, and only where the payout is at least 300 times the stake, measured after the stake comes off (on a wager placed in New York, wherever federal withholding under 26 U.S.C. 3402 applies).
  • 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.

Local tax

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New York City residents pay 3.078 to 3.876 percent on top of state tax. Yonkers residents pay a surcharge of 16.75 percent of the state tax.

The federal 90 percent loss limit in New York

6, 7, 8, 15

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).

New York does not apply the federal 90 percent limit, so a loss deduction on your state return is not cut to 90 percent.

New York 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 New York

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A nonresident owes New York tax on New York Lottery prizes over $5,000 won on or after October 1, 2000, and on gambling winnings over $5,000 from wagering transactions in New York.

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

More about New York

How New York treats gambling losses

New York itemized deductions follow federal law as it was immediately before Public Law 115-97. The IT-196 instructions say your New York gambling loss deduction uses the federal rules that applied to tax year 2017.7, 6
If you file federal Form 1040NR, you get no New York gambling loss deduction.6

If your income is high

If your New York adjusted gross income is above $1,000,000, your New York itemized deduction is only 50 percent of your charitable contributions, and 25 percent above $10,000,000. Your gambling losses then give you no New York deduction. A large win can put you over that line by itself.3
Below $1,000,000, New York cuts your itemized deduction by 25 percent, phased in over $50,000 of New York adjusted gross income above a line for your filing status. It cuts a further 25 percent, phased in over $50,000 above $475,000. The first cut starts above:3
Filing statusFirst 25 percent cut starts above
Single or married filing separately$100,000
Head of household$150,000
Married filing jointly or surviving spouse$200,000

Rates for 2026

For 2026 only the first five New York rates fall, each by a tenth of a point. The band limits and the four top rates are the same as 2025. So if you have a large win, your New York tax is almost the same as in 2025.

City tax withheld on your winnings

If you live in New York City or Yonkers when you win a New York Lottery prize over $5,000, the payer also withholds city tax. New York City withholds 3.876 percent. Yonkers withholds 16.75 percent of the state amount, and Yonkers tax is withheld on every payout that gets New York State withholding, which also takes in winnings from a wager placed in New York that are subject to federal withholding. A 1989 department memo also names New York City withholding on horse racing winnings. No current source we read confirms New York City withholding on other winnings.10, 11, 12, 9, 5
For Yonkers that is 16.75 percent of the state’s 10.9 percent, or about 1.83 percent of the payout.

A bill on the loss deduction

Senate bill S7876 would set the New York gambling loss deduction to zero percent. It is not law. Its last action was January 7, 2026, in the Senate Budget and Revenue Committee.

Sources

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

  1. 1. Form IT-214 instructions: the real property tax credit, federal AGI of $18,000 or less (checked 2026-10-12)
  2. 2. NY Tax Law 601(d-5), supplemental tax recapturing the benefit of the tax tables, for taxable years beginning in 2026 (checked 2026-09-24)
  3. 3. NY Tax Law 615(f) and (g), itemized deduction cut by New York AGI, and charitable gifts only above $1,000,000 (checked 2026-09-24)
  4. 4. Form IT-196 instructions (2025), itemized deduction adjustment worksheet rounding (checked 2026-09-24)
  5. 5. Form IT-2105-I (2026), New York State, New York City and Yonkers rate schedules for 2026 (checked 2026-09-16)
  6. 6. Form IT-196-I, New York itemized deductions, gambling losses on line 29 (checked 2026-09-11)
  7. 7. NY Tax Law 615(a), itemized deductions frozen to pre-P.L. 115-97 federal law (checked 2026-09-11)
  8. 8. NY Tax Law 607, rolling conformity to the Internal Revenue Code (checked 2026-09-11)
  9. 9. TSB-M-89(3)I, withholding on lottery and gambling winnings. Its pari-mutuel figure followed the federal rule of 1989 (checked 2026-09-11)
  10. 10. NY Tax Law 671(b)(2)(D) and (E), withholding on lottery winnings over $5,000 and on winnings from a wager in New York that are subject to federal withholding under IRC 3402, and (b)(3)(D), withheld at the highest rate of tax on New York taxable income (checked 2026-10-11)
  11. 11. NY Tax Law 1332, the Yonkers income tax surcharge, withheld under the provisions of article 22, section 671 included (checked 2026-10-11)
  12. 12. Publication 140-W (10/09), lottery prizes over $5,000 also subject to New York City and Yonkers withholding for a resident of either city when the prize is won (checked 2026-10-11)
  13. 13. Form IT-203-I, New York source income for nonresidents (checked 2026-09-11)
  14. 14. 2026 Form IT-2105 instructions, tax computation worksheets for New York AGI above $107,650 (checked 2026-09-24)

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

  1. 15. 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)

The rules behind these numbers

Other states

Where your sportsbook or app puts your tax forms