How does the IRS know if you won money gambling online?

The IRS knows about your online gambling winnings because operators are required to issue Form W-2G for any win of $1,200 or more from slots, bingo, or keno, and for certain other gambling winnings like $600 or more from poker tournaments or pari-mutuel wagering. These forms are submitted directly to the IRS, and a copy is sent to you. Additionally, all winnings are tracked through your player account, and operators report aggregate winnings annually. Even if you don't receive a W-2G, you are still required to report all gambling income on your tax return. The IRS can cross-reference operator reports with your tax filings, so underreporting is risky. State tax authorities may also receive this information if your state has income tax.

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