Pub-130, Withholding Illinois Income Tax for Lottery or Gambling Winnings

1. When must I withhold Illinois Income Tax from lottery winnings?
2. When must I withhold Illinois Income Tax from gambling winnings?
3. What forms must a winner complete?
4. What forms must I give each recipient?
5. What forms must I submit to the Illinois Department of Revenue?
6. What if the due date falls on a weekend or state recognized holiday?
7. Where do I get help?

You must withhold Illinois Income Tax each time you make a single payment of Illinois lottery winnings of $1,000 or more. It does not matter that several individuals may jointly hold the winning ticket and each person’s “share” is less than $1,000. You must withhold Illinois Income Tax for both residents and nonresidents.

You must withhold Illinois Income Tax from gambling winnings, including sports wagering winnings, you pay any time the winnings are subject to federal income tax withholding requirements and are not subject to another state’s withholding requirements.

In general, winnings that currently are subject to federal income tax withholding include proceeds of more than $5,000 in a single payment from

• a wager placed in a sweepstakes, wagering pool, or lottery (other than a state-conducted lottery); or
• all other wagering transactions, including a wagering transaction in a parimutuel pool with respect to horse races, dog races, or jai alai, if the amount of the proceeds is at least 300 times as large as the amount wagered.

Bingo and slot machine winnings are subject to federal withholding requirements for amounts of $1,200 or more. Winnings from keno of $1,500 or more also are subject to federal withholding requirements. See 26 USCA 3402(q) of the Internal Revenue Code and the IRS’ instructions for federal Forms 5754 and W-2G for more information.

Each time you pay Illinois lottery winnings of $1,000 or more or gambling winnings of more than $5,000 in a single payment, the winner must complete Form IL‑5754, Statement by Person Receiving Gambling Winnings. This form helps you identify which winners are Illinois residents. Keep this form in your records to show who received winnings and to whom the winnings are taxable. You will use this information when you prepare federal Form W-2G.

By January 31 of each year, you must give each recipient two copies of federal Form W‑2G.

Note: You must keep any undeliverable Form W-2G for at least three years after the date you are required to give the form to the recipient.

You are required to

• electronically submit Form W-2G to Illinois Department of Revenue by January 31.
• electronically file Form IL-941, Illinois Withholding Income Tax Return, quarterly. See Publication 131 for more information on filing and payment requirements.

If you are unable to file your forms electronically, you may request Form IL-900-EW, Waiver Request, through our Taxpayer Assistance Division at 1 800 732-8866 or 217 782-3336. The Waiver Request must be completed and submitted back to IDOR. You will be notified if the Waiver Request is approved or denied.

Any time a due date falls on a weekend or state recognized holiday, we adjust the due date to the next business day.

• Visit our website at tax.illinois.gov
• Call us at 1 800 732-8866 or 217 782-3336
• Call our TDD (telecommunications device for the deaf) at 1 800 544-5304
• Write to