Updated October 19, 2026. Quick answer: A lottery, sweepstakes or wagering pool win produces a Form W-2G when the winnings meet the reporting threshold and are at least 300 times the wager, and the payer must withhold 24% when the winnings minus the wager exceed $5,000. The winner’s copy sends the box 1 amount to Schedule 1 and the box 4 amount to Form 1040 as tax withheld. Boxes 3 and 5 are the ones that identify the lottery and the ticket.
When a lottery or sweepstakes win is reported
The payer’s instructions are written for the lottery, sweepstakes or pool that pays you. They say: “File Form W-2G for each person to whom you pay gambling winnings meeting or exceeding the applicable reporting threshold from a sweepstakes, wagering pool, or lottery (including a state-conducted lottery) if the winnings are at least 300 times the amount of the wager.” The wager is part of the test: “The wager must be subtracted from the total winnings to determine whether withholding is required and, at the option of the payer, to determine whether reporting is required.” “The wager must be subtracted at the time of the first payment.”
Small organizations are covered too: “The requirements in this section apply to church raffles, charity drawings, etc.” “In the case of one wager for multiple raffle tickets, such as five for $1, the wager is considered as $.20 for each ticket.”
The reporting threshold is not a fixed number across years. The instructions say: “For calendar years after 2025, the minimum threshold amount for reporting certain payments and backup withholding on certain information returns, including the Form W-2G, will be adjusted yearly for inflation.” “The minimum threshold amount for payments made in calendar year 2026 is $2,000.”
The general rule for when the form is filed at all is this: “Report gambling winnings on Form W-2G if the winnings are subject to federal income tax withholding (either regular gambling withholding or backup withholding).” The box-by-box walk-through of the whole form is in the Form W-2G boxes guide.
What each box shows for these games
The table below follows the instructions for sweepstakes, wagering pools and lotteries. Box 3 is where the lottery is named and the ticket price is entered, and box 5 is where a state lottery ticket number appears.
| Box | What the payer’s instructions say |
|---|---|
| Box 1, reportable winnings | “Enter payments that meet or exceed the applicable reporting threshold if the payment is at least 300 times the wager.” |
| Box 2, date won | “Enter the date of the winning transaction, such as the date of the drawing of the winning number.” “This might not be the date the winnings are paid.” |
| Box 3, type of wager | The payer enters the type of wager, or “the name of the lottery (such as Instant, Big 50, Baker’s Dozen, or Powerball) and the price of the wager” |
| Box 4, federal income tax withheld | “Enter any federal income tax withheld, whether regular gambling withholding or backup withholding.” |
| Box 5, transaction | “For a state lottery, enter the ticket number or other identifying number.” |
| Boxes 6, 8 and 10 | “Not applicable.” |
| Box 7, winnings from identical wagers | “Enter the amount of additional winnings from identical wagers.” |
| Box 9, winner’s TIN | “This is required information.” “Enter the TIN of the person receiving the winnings.” |
| Boxes 11 and 12, identification | “Except for winnings from state lotteries, as verification of the name, address, and TIN of the person receiving the winnings, enter the identification numbers from two forms of identification.” |
| Boxes 13 to 18, state and local | “These boxes are provided for your convenience only and need not be completed for the IRS.” |
For the amount in box 1 and the identical-wager amount in box 7, see Form W-2G boxes 1 and 7.
What is withheld
The payer’s instructions say: “You must withhold federal income tax from the winnings if the winnings minus the wager exceed $5,000.” “Withhold 24% of the proceeds (the winnings minus the wager).” “This is regular gambling withholding.”
The tax is figured on the whole amount: “Regular gambling withholding is figured on the total amount of gross proceeds (the amount of winnings minus the amount wagered), not merely on the amount in excess of $5,000.”
If you did not give the payer a taxpayer identification number, a second rule applies: “If the winner of reportable gambling winnings doesn’t provide a TIN, you must backup withhold on any such winnings that aren’t subject to regular gambling withholding at the same withholding rate of 24%.” A Form W-9 is how a taxpayer identification number is normally supplied: “You may use Form W-9, Request for Taxpayer Identification Number and Certification, to request the TIN of the recipient.” More on box 4 is in Form W-2G box 4 and boxes 13 to 18.
Installments, annuities and lump sums
Many lottery prizes are paid over time, and the instructions address that. “Installment payments of $5,000 or less are subject to regular gambling withholding if the total proceeds from the wager will exceed $5,000.” “If payments are to be made for the life of a person (or for the lives of more than one person), and it is actuarially determined that the total proceeds from the wager are expected to exceed $5,000, such payments are subject to 24% regular gambling withholding.” “When a third party makes the payments, for example, an insurance company handling the winnings as an annuity, that third party must withhold.”
The timing of a payment depends on a choice: “A payment of winnings is considered made when it is paid, either actually or constructively, to the winner.” The exception: “if not later than 60 days after the winner becomes entitled to the prize, the winner chooses the option of a lump sum or an annuity payable over at least 10 years, the payment of winnings is considered made when actually paid.” “If the winner chooses an annuity, file Form W-2G each year to report the annuity paid during that year.” So an annuity winner can expect a form for each year a payment is made.
Identical wagers
Box 7 exists because of this rule: “are added together for purposes of the reporting and withholding requirements.” Per the instructions, “Two or more wagers are identical wagers if they are placed with the same payer and winning depends on the occurrence (or non-occurrence) of the same event or events.”
Shared winnings and the signature
If you are the only person entitled to the prize, the winner’s copy says: “You must sign Form W-2G if you are the only person entitled to the winnings and the winnings are subject to regular gambling withholding.” “Return the signed form to the payer, who will give you your copies.”
If someone else is entitled to part of the prize: “Prepare Form 5754 if another person is entitled to any part of these winnings.” For a state lottery in particular, the instructions add: “a recipient of winnings from a state-conducted lottery need not provide identification other than their taxpayer identification number (TIN).”
Where it goes on the return
The winner’s copy of the form tells you where each part goes. For box 1: “Generally, report all gambling winnings under the” Other income line of Schedule 1 (Form 1040), and the Schedule 1 lines 8a and 8b page covers that part of the return. For box 4: “Include the amount shown in box 4 on your Form 1040 or 1040-SR as federal income tax withheld.” That is the line described on the Form 1040 line 25 page.
The winner’s copy also says: “Keep an accurate record of your winnings and losses, and be able to prove those amounts with receipts, tickets, statements, or similar items that you have saved.”
Edition and box numbers
This page reads Form W-2G (Rev. January 2026) and the Instructions for Forms W-2G and 5754 (Rev. January 2026), the current files irs.gov served on 2026-10-19. The instructions state: “Form W-2G and its instructions have been converted from an annual revision to continuous use.” “Both the form and instructions will be updated as needed.” No earlier edition is compared here. Check the year and edition printed on the form you received, because box numbers can change between editions.
Common mistakes
- Judging the withholding threshold on the prize alone. The instructions say the test uses the prize less the ticket: “Withhold 24% of the proceeds (the winnings minus the wager).”
- Expecting one form for a multi-year annuity. The instructions say “If the winner chooses an annuity, file Form W-2G each year to report the annuity paid during that year.”
- Assuming a small installment is never withheld on. The instructions say “Installment payments of $5,000 or less are subject to regular gambling withholding if the total proceeds from the wager will exceed $5,000.”
Related: Schedule 1 lines 8a and 8b, Schedule 1 (Form 1040), Form 1040 line 25, and Form W-9.
Sources
- Form W-2G, Certain Gambling Winnings (Rev. January 2026), with Instructions to Winner: https://www.irs.gov/pub/irs-pdf/fw2g.pdf
- Instructions for Forms W-2G and 5754 (Rev. January 2026): https://www.irs.gov/pub/irs-pdf/iw2g.pdf
- IRS: About Form W-2G: https://www.irs.gov/forms-pubs/about-form-w-2g
Read from the IRS documents linked above on October 19, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.