Tax Center
Plain-English explainers on how prediction-market gains and losses are taxed — what to report, how Section 1256 works, and how to keep clean records. No jargon, no hype.
Arbitrage betting profits are taxable in the US, but how depends on the facts: casual gambling income, a Schedule C business, or possibly Section 1256 capital. Here is how arbitrage betting taxes work and why characterization decides what you owe.
A practical guide to keeping clean Kalshi and Polymarket records for tax season: what to track, how to pull your trade history, and the record-keeping mistakes to avoid.
Starting with tax year 2026, the One Big Beautiful Bill Act (OBBBA) caps the gambling-loss deduction at 90% of losses, so break-even bettors can owe tax on phantom income. Here is how the new IRC §165(d) rule works, who it hurts, and where prediction-market contracts may differ.
The most common tax mistakes sports bettors and prediction-market traders make — from "no 1099 means nothing to report" to neglected records — and what to do instead.
Section 1256 contracts get a blended 60% long-term / 40% short-term tax rate, mark-to-market, and a loss carryback — here is how the 60/40 rule works and why it might matter for prediction-market traders.
Yes — Kalshi winnings are taxable income in the U.S. Here is how event-contract gains and losses are generally reported, why the tax treatment is still unsettled, and what records to keep.
Looking for the bigger picture? Visit the Prediction Market Tax Center.