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Jennifer Horikawa of Maui, Hawaii, plays on a slot machine at the Main Street Station hotel-casino in downtown Las Vegas on Tuesday, May 26, 2015. The Internal Revenue Service has proposed lowering the reporting level for gambling winnings from $1,200 to $600, a move that the casino industry and its patrons oppose. (Chase Stevens/Las Vegas Review-Journal) Follow Chase Stevens on Twitter @csstevensphoto.
However, for the following sources listed below, gambling winnings over $5,000 are subject to income tax withholding: 1  Any sweepstakes, wagering pool (including payments made to winnners of poker tournaments), or lottery. 2  Any other wager (if the proceeds are at least 300 times the amount of the bet).