It doesn't matter if it is a winning sports bet, lottery winnings or slots at Arizona casinos. Gambling winnings in AZ are considered income and must be reported on state and federal tax returns even if you do not receive a W-2 G, according to the IRS. With new bettors in Arizona, this important to emphasize. The state income tax rate in Arizona ranges from 2.59% to 4.50%, which is the rate your gambling winnings are taxed.īettors have a responsibility to report their winnings on their income tax return. The effective tax rate is the actual percentage you pay after taking the standard deduction and other possible deductions. Marginal tax rate is the bracket your income falls into. It's important to consider all of your AZ gambling winnings when preparing your taxes because those winnings, when added to your annual income, could move you into a higher tax bracket.
Your tax rate depends on your filing status, annual income and tax bracket.
