Uncertainty persists over tax treatment of $25 billion in World Cup bets as the IRS fails to clarify reporting requirements for traders.
The IRS has not issued guidance on how to tax $25 billion in World Cup prediction market winnings, leaving traders uncertain about reporting obligations. The agency has remained silent despite the 2026 tax year being more than halfway through, even as betting volumes surge.
World Cup markets surpassed $25 billion in total trades, with Kalshi’s Spain-Argentina market alone hitting $1.27 billion. For comparison, NBA finals trading reached about $2 billion. Tax experts warn conflicting advice is creating confusion, though all agree winnings are taxable.
Traders face ambiguity over which tax rules apply, with even industry professionals like Tax Foundation economist Alan Cole unsure of proper reporting. Cole reported a $128,000 profit from a $342,195.63 bet but lacks clarity on tax treatment.