Does Mississippi Tax Gambling Winnings

Posted By admin On 04.02.21

No doubt about it, winning the lottery dramatically changes a person’s life. A financial windfall of that magnitude quickly grants you a level of financial freedom you probably have trouble imagining.

Gambling Winnings New Tax Law
Does Mississippi Tax Gambling Winnings 2019
Does Mississippi Tax Gambling Winnings Losses

Gambling winnings from Mississippi gaming establishments are not included in gross income. No deduction is allowed for gaming losses incurred at MS gaming establishments. No credit or deduction may be claimed for the amount of tax withheld on gaming winnings. Required Reporting of Gambling Winnings. Casinos are required to report gambling winnings if they exceed a certain limit ($1,200 of slot machine winnings for example). Gambling winnings get reported on the first page of your tax return on line 21. Mississippi taxable income on gambling winnings will be on the W-2G form. Column 3 – Ratio of Income Earned – Divide the amount in Column 2 by the amount reported on Form IT-540, Line 7 or Schedule E, Line 1, if completed, or Form IT-541, Line 1, or Schedule A, Line 1, if completed. Round the percentage to two places after the decimal. Gambling winnings reported on a W-2G, 1099, or other informational return from Mississippi casinos are subject to a three percent (3%) non-refundable income tax. The casinos withhold the tax at the time of payout. The amount withheld is non-refundable to the taxpayer.

But becoming a Mega Millions or Powerball jackpot winner doesn’t change everything. If you are the lucky winner, you still have to worry about bills and taxes. This is when a lottery tax calculator comes handy.

How are lottery winnings taxed under federal and state?

Lottery winnings are considered ordinary taxable income for both federal and state tax purposes. That means your winnings are taxed the same as your wages or salary. And you must report the entire amount you receive each year on your tax return.

For example, let’s say you elected to receive your lottery winnings in the form of annuity payments and received $50,000 in 2019. You must report that money as income on your 2019 tax return. The same is true, however, if you take a lump-sum payout in 2019. You must report that entire amount as well. For this, a tax calculator is an essential tool.

Note: Before you receive one dollar, the IRS automatically takes 25 percent of your winnings as tax money. You’re expected to pay the rest of your tax bill on that prize money when you file your return.

What is the tax rate for lottery winnings?

When it comes to federal taxes, lottery winnings are taxed according to the federal tax brackets. Therefore, you won’t pay the same tax rate on the entire amount. The tax brackets are progressive, which means portions of your winnings are taxed at different rates. Depending on the number of your winnings, your federal tax rate could be as high as 37 percent as per the lottery tax calculation.

State and local tax rates vary by location. Some states don’t impose an income tax while others withhold over 15 percent. Also, some states have withholding rates for non-residents, meaning even if you don’t live there, you still have to pay taxes to that state.

Do I have to pay state taxes on lottery winnings if I don’t live in the state where I bought the ticket?

Most states don’t withhold taxes when the winner doesn’t reside there. In fact, of the 43 states that participate in multistate lotteries, only two withhold taxes from nonresidents. Arizona and Maryland both tax the winnings of people who live out-of-state.

Can I change the amount of tax the lottery withholds?

You don’t have a choice on how much state or federal tax is withheld from your winnings. The only piece you can control is how much money you save to cover any extra money you may owe. For this, you can use a federal tax calculator.

Do lottery winnings count as earned income for Social Security purposes?

Lottery winnings are not considered earned income, no matter how much work it was purchasing your tickets. Therefore, they do not affect your Social Security benefits.

Does winning the lottery affect my tax bracket?

Winning the lottery can affect your tax bracket in a big way. An average family’s top federal tax rate could go from 22 percent to 37 percent. But remember, if that happens, you likely won’t pay the top rate on all of your money.

That is unless your regular household income already places you in the top tax bracket prior to winning. In that case, all of it is taxed at 37 percent. This can be calculated using a tax calculator. Lottery winnings are combined with the rest of your taxable income for the year, meaning that money is not taxed separately.

What are the benefits of taking a lump sum payment versus annuity payments?

If you take a lump sum, you have more control over your money right now. You can choose to invest it into a retirement account or other stock option to generate a return. You could also use it to buy or expand a business.

Several financial advisors recommend taking the lump sum because you typically receive a better return on investing lottery winnings in higher-return assets, like stocks. If you elect annuity payments, however, you can take advantage of your tax deductions each year with the help of lottery tax calculator and a lower tax bracket to reduce your tax bill.

The decision for which option is better is complex. It all depends on the size of the lottery winnings, your current and projected income tax rates, where you reside, and the potential rate of return on any investments. If you win big, it’s in your best interest to work with a financial advisor to determine what’s right for you. However, you can also determine the taxes using a federal tax calculator.

Are you a lucky winner? Determine what you owe in taxes with this Lottery Tax Calculator.

More to explore:

Introduction to Mississippi Slot Machine Casino Gambling in 2020

Mississippi slot machine casino gambling consists of 27 riverboat casinos and three American Indian tribal casinos. International cruise ships with onboard casinos also depart from ports in Biloxi and Gulfport.

Minimum and maximum payout return limits have been legally set by the state. Further, comprehensive actual payout return statistics are available by gaming machine type and state region.

This post continues my weekly State-By-State Slot Machine Casino Gambling Series, an online resource dedicated to guiding slot machine casino gambler to success. Now in its third year, each weekly post reviews slots gambling in a single U.S. state, territory, or federal district.

Keep Reading … or Watch Instead!

Or … Listen Instead!

Relevant Legal Statutes on Gambling in Mississippi*

The minimum legal gambling age in Mississippi depends upon the gambling activity:

Land-Based Casinos: 21
Poker Rooms: 21
Bingo: 18
Lottery: Not available
Pari-Mutuel Wagering: Not available

Gambling in Mississippi has aided to the economy of the state and breathed new life into its tourism industry. In 1990, the Mississippi state legislature was the third U.S. state to legalize riverboat gambling.

By law, Mississippi’s riverboat casinos must be located on coastal waters, the Mississippi River, and in navigable waters of counties bordering the Mississippi River.

After Hurricane Katrina in 2005, the Mississippi legislature allowed the state’s gulf coast casinos to rebuild on land within 800 feet of the shoreline.

Winning a jackpot of $1,200 or more in Mississippi results in a nonrefundable 3% tax of those winnings paid to the Mississippi Gaming Commission. This limit also applies to any cash prizes won in casino drawings and tournaments.

*The purpose of this section is to inform the public of state gambling laws and how the laws might apply to various forms of gaming. It is not legal advice.

Slot Machine Private Ownership in Mississippi

It is legal to own a slot machine privately in Mississippi if it is at least 25 years old.

Gaming Control Board in Mississippi

The Mississippi Gaming Commission (MGC) is responsible for non-tribal, commercial casinos. The gaming regulations used are from MGC but also from state law, specifically the Gaming Control Act.

The Mississippi Band of Choctaw Indians also has its Choctaw Gaming Commission for Mississippi’s three tribal casinos. The gaming compacts which authorized tribal gaming in Mississippi established this gaming commission.

Casinos in Mississippi

Mississippi has 27 commercial casinos, three American Indian tribal casinos, and cruise ships sailing out of the ports of Biloxi and Gulfport to international destinations.

The largest casino in Mississippi is Island View Casino Resort with 2,700 gaming machines.

The second-largest casino is Silver Star Casino at Pearl River with 2,500 gaming machines.

Commercial Casinos in Mississippi

Mississippi’s 27 riverboat casinos are:

Ameristar Casino Hotel Vicksburg within the Central Region located 44 miles west of Jackson on the Mississippi River.
Beau Rivage Resort & Casino in Biloxi within the Coastal Region located 63 miles west of Mobile, Alabama on the Gulf Coast.
Boomtown Casino – Biloxi within the Coastal Region located 63 miles west of Mobile, Alabama on the Gulf Coast.
1st Jackpot Casino Tunica within the Northern Region located 41 miles southwest of Memphis, Tennessee on the Mississippi River.
Fitz Casino Hotel in Tunica within the Northern Region located 41 miles southwest of Memphis, Tennessee on the Mississippi River.
Gold Strike in Tunica within the Northern Region located 41 miles southwest of Memphis, Tennessee on the Mississippi River.
Golden Nugget – Biloxi within the Coastal Region located 63 miles west of Mobile, Alabama on the Gulf Coast.
Hard Rock Hotel & Casino – Biloxi within the Coastal Region located 63 miles west of Mobile, Alabama on the Gulf Coast.
Harlow’s Casino Resort in Greenville within the Northern Region located 119 miles northwest of Jackson on the Mississippi River.
Harrah’s Gulf Coast in Biloxi within the Coastal Region located 63 miles west of Mobile, Alabama on the Gulf Coast.
Hollywood Casino Gulf Coast in Bay St. Louis within the Coastal Region located 91 miles west of Mobile, Alabama on the Gulf Coast.
Hollywood Casino Tunica within the Northern Region located 41 miles southwest of Memphis, Tennessee on the Mississippi River.
Horseshoe Tunica Hotel & Casino within the Northern Region located 41 miles southwest of Memphis, Tennessee on the Mississippi River.
IP Casino Resort Spa in Biloxi within the Coastal Region located 63 miles west of Mobile, Alabama on the Gulf Coast.
Island View Casino Resort in Gulfport within the Coastal Region located 75 miles west of Mobile, Alabama on the Gulf Coast.
Isle of Capri Casino Hotel Lula within the Northern Region located 59 miles southwest of Memphis, Tennessee on the Mississippi River.
Lady Luck Casino Vicksburg within the Central Region located 44 miles west of Jackson on the Mississippi River.
Magnolia Bluffs Casino Hotel in Natchez within the Central Region located 103 miles southwest of Jackson on the Mississippi River.
Palace Casino Resort in Biloxi within the Coastal Region located 63 miles west of Mobile, Alabama on the Gulf Coast.
Riverwalk Casino Hotel in Vicksburg within the Central Region located 44 miles west of Jackson on the Mississippi River.
Sam’s Town Tunica within the Northern Region located 41 miles southwest of Memphis, Tennessee on the Mississippi River.
Scarlet Pearl Casino Resort in Biloxi within the Coastal Region located 63 miles west of Mobile, Alabama on the Gulf Coast.
Silver Slipper Casino in Bay St. Louis within the Coastal Region located 91 miles west of Mobile, Alabama on the Gulf Coast.
Treasure Bay Casino and Hotel in Biloxi within the Coastal Region located 63 miles west of Mobile, Alabama on the Gulf Coast.
Trop Casino Greenville within the Northern Region located 119 miles northwest of Jackson on the Mississippi River.
Tunica Roadhouse Casino and Hotel within the Northern Region located 41 miles southwest of Memphis, Tennessee on the Mississippi River.
WaterView Casino & Hotel in Vicksburg within the Central Region located 44 miles west of Jackson on the Mississippi River.

Tribal Casinos in Mississippi

Mississippi’s three tribal casinos are each a property of Pearl River Casinos and Resorts, owned and operated by the Mississippi Band of Choctaw Indians, including:

Bok Homa Casino in Sandersville located 93 miles southeast of Jackson.
Golden Moon Hotel & Casino in Philadelphia located 75 miles northeast of Jackson.
Silver Star Hotel & Casino in Philadelphia located 75 miles northeast of Jackson.

Other Gambling Establishments

As an alternative to enjoying Mississippi slot machine casino gambling, consider exploring casino options in a nearby state. Bordering Mississippi is:

North: Tennessee Slots
East: Alabama Slots
South: The Gulf of Mexico
West: Arkansas Slots and Louisiana Slots

Each of the links above will take you to my blog for that neighboring U.S. state to Mississippi.

Our Mississippi Slots Facebook Group

Gambling Winnings New Tax Law

Are you interested in sharing and learning with other slots enthusiasts in Mississippi? If so, join our new Mississippi slots community on Facebook. All you’ll need is a Facebook profile to join this closed Facebook Group freely.

There, you’ll be able to privately share your slots experiences as well as chat with players about slots gambling in Mississippi. Join us!

Payout Returns in Mississippi

The Mississippi Gaming Commission (MGC) offers monthly return statistics for commercial casinos by region of the state:

Does Mississippi Tax Gambling Winnings 2019

Central Region, including the cities of Vicksburg and Natchez
Northern Region, including the cities of Tunica, Greenville, and Lula
Coastal Region, including the cities of Biloxi, Gulfport, and Bay St. Louis

The minimum and maximum theoretical payout limits are 80% and 100% according to MGC’s Regulations, Part 3: Operations, Rule 12.5: Minimum Standards for Gaming Devices.

These limits apply for each wager of a gaming device. If the gaming device played is a skill-based, competition-style machine, these limits apply when playing it with optimal strategy or perfect play.

Does Mississippi Tax Gambling Winnings Losses

MGC’s Monthly Revenue Reports offer the most recent month Slots Player Win Percent. Their Monthly Archives offer return statistics reports from prior months over the last twenty years.

The revenue reports offer the Win% for machine denominations for all casinos within a state region: Central, Northern, and Coastal. Further, progressive machines have separate entries by denomination. Gaming machines include:

Slot machines
Video poker machines
Video keno machines

Another useful monthly report is Gaming Devices Report, which offers how many machines of each denomination are in each commercial casino. Once again, progressive versus non-progressive machines are separate.

Relative to other U.S. gaming jurisdictions, the payout statistics provided by Mississippi are the most thorough treatment I’ve seen for payout returns.

The Mississippi Band of Choctaw Indians has not established theoretical payout limits in their gaming compact or by its Choctaw Gaming Commission. Further, as is often the case, no actual return statistics are publicly available.

Summary of Mississippi Slot Machine Casino Gambling in 2020

Mississippi slot machine casino gambling consists of 28 commercial casinos, three tribal casinos, and cruise ships sailing out of the ports of Biloxi and Gulfport on the Gulf Coast to international destinations.

Minimum and maximum theoretical payout limits at commercial casinos are 80% and 100%. Possibly the best return statistics in the U.S. are available from Mississippi, available by three state regions and machine denominations as well as whether they are progressive machines.

Annual Progress in Mississippi Slot Machine Casino Gambling

In the last year, one commercial casino has closed, the Resorts Casino Tunica.

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