Kansas is one of a growing number of states where lawmakers are thinking about legalizing sports betting.

Kansas Income Tax Gambling Losses

A new bill appeared in the Kansas legislature that would allow the state’s horse racing tracks to offer single-game wagering. The interesting part: There are currently no active tracks in the state.

The Kansas sports betting bill

1. IRS Withholding. All casino winnings are subject to federal taxes. However, the IRS only requires the casinos to report wins over $1,200 on slots and video poker machines or other games such as keno, lottery or horse racing.
2. State gaming and tax revenue totals do not include revenue and taxes from these non-commercial casino locations—with the exception of Nevada, due to its unique nature, in which revenue and tax data from some locations which offer gaming as incidental to their primary business is included. Also excluded from state gaming revenue.

H 2533 is a short bill that allows for the Kansas lottery to authorize sports betting at tracks where horse betting already takes place.

Of course, like all other states, the Kansas law would need a change in the federal sports betting ban — PASPA — to be able to offer sports betting. That could come as soon as this spring with a decision from the US Supreme Court in the New Jersey sports betting case. The nation’s highest court could rule that the federal ban is unconstitutional.

I'm having an issue with my 2016 taxes. Originally turbo tax calculated that I owed Ohio approximately $8,000 because of my gambling winnings in Indiana. At the time I was unable to pay for a second state and open a Indiana return. After updating my software yesterday and going to amend my taxes now TurboTax says they don't think I need to file a Indiana return and that I owe Ohio 6000. Kansas Source Income from a Kansas source includes all of the following: All income earned while a Kansas resident, Income from services performed in Kansas, Kansas lottery, pari-mutel, casino and gambling winnings, Income earned from real or tangible personal property located in Kansas.

From the bill:

Any sports gambling authorized by the Kansas lottery in accordance with this act shall be conducted solely on the premises of a racetrack gaming facility and shall be managed and operated by one or more racetrack gaming facility managers.

The bill was introduced by the Committee on Federal and State Affairs.

Kansas was one if the first states to legalize paid-entry fantasy sports back in 2015, although it did nothing to regulate the daily fantasy sports industry.

College wagering OK

Oklahoma Gambling Taxes

The bill does not go into great detail about how the state would regulate wagering. The lottery would be in charge of logistics.

One of the few details in the bill is that wagering on amateur sporting events — including wagering on collegiate games — could take place alongside professional sports. Kansas University basketball is a big draw in the state. There are also MLB’s Kansas City Royals and the NFL’s Kansas City Chiefs in neighboring Missouri.

So where could betting take place?

The purpose of the bill — given the current lack of active racing tracks — is not clear. There has been no pari-mutuel racing in the state since 2008. All licenses “have lapsed and been revoked” according to the state racing and gaming commission.

Kansas Income Tax Gambling Winnings

The bill could presumably be meant to restart the state’s horse racing industry. Tracks in the state can partner with the lottery to offer slot machines, under state law. A racing license tied to the prospect of sports betting would no doubt be attractive.

The bill appears to shut out casinos in the state. Kansas has both commercial and tribal casinos. Trying to authorize sports betting at casinos could create problems vis a vis tribal gaming compacts.

The legislation does not appear to allow for any form of online wagering.

State interest in sports betting reaching a crescendo

The number of states with interest in sports wagering grows nearly every day.

Just this week, we’ve seen Massachusetts introduce a bill to study sports wagering and a hearing in New York about the possibility of sports betting expansion. Last week, Rhode Island’s governor included revenue from potential legal sports betting in the state budget.

As legislatures around the country start to stir to action to start to 2018, we’re only going to see more sports betting bills like the one in Kansas.