WeVote
Log In

Bill

Bill

SSB 1152

A bill for an act relating to state income tax withholdings on winnings from sports wagering, and including effective date provisions.

2025-2026 Regular Session

Iowa would withhold state income tax from sports wagering winnings that are federally subject to withholding, aligning state rules with federal treatment.

Committee report approving bill, renumbered as SF 605.
#gambling #incometaxes #internalrevenuecode #revenuedepartment #sportswagering
0
WeVote Research Nonpartisan
Bill Summary · SSB 1152

Summary of SSB 1152 (renumbered as SF 605) — Iowa

Overview

SSB 1152 proposes to require Iowa state income tax withholding on winnings from sports wagering, but only to the extent those winnings are subject to federal income tax withholding. The bill sets an effective date of January 1, 2026. It is part of the state’s tax handling related to gambling and aligns Iowa withholding with federal withholding when applicable.

What the bill would do

  • When sports wagering winnings are subject to federal income tax withholding, Iowa state income tax must be withheld from those winnings.
  • The withholding would be imposed as part of the payout process for eligible sports wagering winnings, with the payer (likely the wagering operator or casino) responsible for withholding.
  • The proposal ties Iowa withholding requirements to the existence of federal withholding on the same winnings, making the state withholding contingent on federal treatment.

Who is affected

  • Individuals who win sports wagering prizes/winnings that are also subject to federal withholding.
  • Sports wagering operators, casinos, or any entity responsible for paying out winnings, which would assume the obligation to withhold Iowa state income tax from eligible winnings.
  • The Iowa Department of Revenue and related tax administration entities would implement rules and guidance to administer the withholding.

Key provisions and details

  • The central provision is a withholding obligation: if winnings are federally subject to withholding, Iowa state income tax must be withheld from the winnings.
  • The bill does not specify withholding rates within the summary; it establishes the requirement and alignment with federal withholding where applicable.
  • Effective date: January 1, 2026.

Procedural/timeline context

  • Introduced: February 18, 2025.
  • Referred to the Ways and Means committee.
  • February 20–25, 2025: Subcommittee process (Dawson, Bisignano, Rowley) with a subcommittee meeting on February 25.
  • February 25, 2025: Subcommittee recommends passage.
  • March 11, 2025: Committee report approving the bill; renumbered as SF 605.

Potential implications

  • Increased compliance and administrative requirements for sports wagering payers.
  • Potential impact on bettors who may see net winnings reduced by withholding, depending on withholding rates and timing.
  • Additional state revenue management considerations for Iowa, depending on how withholding is implemented and reported.

Next steps

  • As SF 605, further committee action, floor consideration, and any amendments would determine final text, rates (if specified elsewhere), reporting requirements, and interaction with other tax provisions.

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.