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Betting Laws – Your Essential Update

With New Jersey’s Supreme Court victory, many states have legalized sports betting. People can now place bets 24 hours a day through virtual mobile casinos in their pockets.

John T. Holden from Oklahoma State’s Spears School of Business and Kathryn Kisska-Schulze from Clemson University have suggested in the Cardozo Law Review that Congress promote equity within this lucrative industry by diverting tax revenue generated by sports gambling towards higher education.


Since 1988, PASPA had prohibited states from legalizing sports betting; however, the Supreme Court recently overturned that ban to enable regulated sports gambling within individual states.

Even though sports betting has become legalized, concerns remain regarding any illegal activity associated with it. The NFL, NBA and MLB have asked Congress to create a regulatory framework to govern sports betting; college athletes have reported receiving threats from bettors who lost money betting on them.

Though many states have introduced laws legalizing sports betting, others remain on the waitlist. Some, like South Dakota, have legalized betting only in Deadwood but not throughout their state; others face deep-seated political opposition or complex tribal relations that stymie progress on this front; nevertheless, legalization seems to be rapidly progressing; traditionally anti-gambling states like Georgia even introduced bills this year!


With states soon to legalize sports betting, they should enact clear rules to regulate and safeguard it – such as prohibiting advertising on college campuses, self-exclusion from gambling apps and mandating those apps include tools for helping manage players’ gambling habits.

Kathryn Kisska-Schulze and John T. Holden in the American University Law Review suggest that lawmakers allocate some of the revenue generated from sports betting toward education to help avoid issues like bettors behaving violently when losing money on games involving their favorite teams. Doing this could prevent problems like bettors behaving aggressively when losing.

Some state lawmakers have taken steps to address some of these concerns. Vermont’s new law, for instance, mandates payment systems which prevent credit cards, electronic fund transfers or checks being used illegally online gambling transactions. Furthermore, Vermont must produce an annual report on problem gambling while allocating $250,000 towards research and treatment of problem gambling next year.


Gambling winnings count as income and must be reported and taxed accordingly. State and federal laws dictate how to tax gambling winnings; typically winnings should be reported to your local department of revenue or withheld as income tax from them by you as required by each state.

The government intends to implement a statutory gambling operator levy so operators contribute towards funding treatment services and research at NHS institutions, replacing a voluntary one which doesn’t reach enough of a threshold level of contributions.

The NCAA is also advocating that lawmakers adopt other responsible gaming measures, including mandatory reporting hotlines for gambling operators and increased penalties for those who violate sports betting laws. By doing this, it hopes to prevent young people from becoming addicted to gambling while helping prevent misuse of sports betting data by illegal operators.


The Federal Wire Act prohibits the transmission of information that assists in placing bets or wagers on any sporting contest, and also forbids money or credit transfers to pay for said bet or wager. It applies to anyone operating, managing, directing or supervising an Internet website where unlawful bets or wagers are placed or received and made.

House Judiciary Committee recently conducted a hearing regarding sports gambling. A key issue at hand is whether to extend the Wire Act to cover such betting and, if that should occur, how it could be enforced.

AGA advocates for an enforcement effort that ensures sports wagering companies adhere to regulations designed to keep consumers safe. Regulations may include advertising rules requiring sports wagering companies to display the number for gambling hotline and harassment-free sports gambling environments; age-appropriate advertisements and education as well as promotion of responsible betting practices should also be promoted by these regulations. Sports gambling generates crucial state, local, and federal tax revenue that finances infrastructure needs as well as responsible gaming education and problem gambling programs.