Iowa Gambling Tax Calculator
Calculate the federal and Iowa state withholding on a sports betting win under the SF 605 rules effective January 1, 2026. Enter your wager amount and odds; the calculator does the rest.
Enter your bet
Result
- Gross profit on this bet
- $500.00
- Total payout (stake + profit)
- $600.00
- Federal withholding triggered?
- Yes (24%)
- Federal withholding amount
- $120.00
- Iowa SF 605 withholding triggered?
- Yes (3.8%)
- Iowa withholding amount
- $19.00
- Net cash you receive
- $461.00
This calculator estimates withholding at the payout stage only. You may still owe additional federal and Iowa state income tax on your gambling winnings at tax-filing time. Consult a tax professional for advice specific to your situation. This tool is for informational purposes and does not constitute tax advice.
How the calculation works
The US federal government and Iowa apply withholding to large sports betting wins at the moment of payout. Here are the two rules:
Federal withholding (24%)
Federal withholding kicks in when both of these are true:
- The total payout (profit) is $5,000 or more.
- The odds are 300-to-1 or greater (a +30000 moneyline or longer; including most long-shot parlays).
When triggered, the sportsbook withholds 24% of the profit and remits it to the IRS. You receive a W-2G documenting the win and the withholding.
Iowa SF 605 withholding (3.8%)
Effective January 1, 2026, Iowa Senate File 605 requires Iowa sportsbooks to withhold 3.8% Iowa state income tax on any winnings that also trigger federal withholding. Practically: if the federal 24% kicks in, the Iowa 3.8% also kicks in.
Small wins ($500 single bets, modest parlays under +300 odds) are not withheld at the payout stage; but you must still report all gambling income on your Iowa Form 1040 at tax time.
Examples
| Scenario | Profit | Fed withheld | IA withheld | Net |
|---|---|---|---|---|
| $100 bet at -110 wins | $91 | -- | -- | $191 |
| $50 bet at +400 wins | $200 | -- | -- | $250 |
| $100 bet at +500 wins | $500 | -- | -- | $600 |
| $10 parlay at +30000 wins | $3,000 | -- | -- | $3,010 |
| $20 parlay at +30000 wins | $6,000 | $1,440 | $228 | $4,352 |
| $100 bet at +5000 wins | $5,000 | -- | -- | $5,100 |
| $50 parlay at +30000 wins | $15,000 | $3,600 | $570 | $10,880 |
Note: federal withholding requires both $5,000+ profit and 300:1+ odds. A $5,000 profit at -110 does not trigger withholding because the odds threshold isn't met.
Annual reporting
Withholding is only the payout-stage piece. At tax time you still must:
- Report all gambling winnings on your federal Form 1040, Schedule 1, line 8b.
- Report on your Iowa Form 1040 as well; Iowa taxes gambling winnings at the standard state income tax rate (5.7% top bracket for 2026).
- Itemize to deduct losses. You can deduct gambling losses up to the amount of winnings, but only if you itemize. With the standard deduction now $14,600+ for singles, most casual bettors take the standard deduction and cannot offset losses.
- Keep records. Save all W-2Gs from operators, plus a session log. Iowa sportsbooks make your win/loss statement available in the cashier; download it annually.