The National Football League title game is the most gambled-on sporting event in the nation with more than $100 million legally wagered in recent years on the Super Bowl at sports books in Nevada.
And those winnings, obtained legally or illegally, are taxable if the Internal Revenue Service (IRS) can prove it, reported Bankrate.com. That said, the IRS only tracks down big winners.
For bettors who win $5,000 or more from any sweepstakes, wagering pool or lottery or from betting proceeds that are 300 times or more the amount of the bet, 25 percent is withheld.
Even if you don't receive an official W-2G form from a casino or betting operation with your tax ID, you're required to report all your gambling winnings to the IRS. "In reality, that doesn't happen," the article states.
In 2010, legal sports wagers totaled $2.76 billion annually, according to American Gaming Association data. That figure is drastically dwarfed by illegal bets, which the National Gambling Impact Study Commission estimates to amount to as much as $380 billion annually.