Sports gambling has been legal in Michigan for more than three years now. Governor Gretchen Whitmer signed a bill legalizing the pastime in December of 2019. The industry got out to a bit of a false start, as the first retail sportsbooks opened in March of 2020, just as the COVID-19 pandemic began to take hold, causing lockdowns and shuttered businesses all over the world. It was nearly another year before mobile sportsbooks went live in January of 2021, giving customers an option to place bets without having to deal with social distancing measures, and the industry wasted no time exploding.
It’s an exciting time to be a sports fan in Michigan. The Detroit Lions finally look like they’re on the upswing after decades of futility. Detroit’s secondary was a big issue last season, but after a series of free agency signings to improve their pass defense, the Lions have the best Super Bowl odds of any team in the NFC North (and some of the best in the league, tied for seventh at or around +2500).
Whether you’re a veteran bettor who needs a refresher course or you’re just starting to dip your toes in the water, here’s the information you need to know about placing sports wagers in Michigan.
First and foremost is the aforementioned bonus codes. Especially if you’re new to the world of mobile betting, sportsbooks and online casinos in Michigan offer lots of promotions like risk-free first bets and deposit matches to get you interested in making wagers and to give a little advantage to the wary bettor. Even if you’ve been placing wagers for a long time, some of the sportsbooks will still run promotions that you can take part in from time to time, especially ahead of big events like March Madness or the Super Bowl. Keep your eyes peeled for odds boosts and things of the sort that can sweeten the deal.
Another important thing to keep in mind is how taxes work for gambling. Unlike when you make a purchase at a store, state and federal taxes aren’t automatically deducted from the bets you win: if you win a bet today, you’ll have to set some of your winnings aside until tax forms come out in 2024, because they count as taxable income. Some municipalities levy local income taxes too, so you may have to set aside a bit more depending where you live.
If you make more than $600 for the year through sports betting, the casino you placed the bets with should automatically send you a form 1099-MISC. The lone exception to the delay is if you make (and win) a massive wager: operators are required to withhold the 24 percent federal tax rate and the state of Michigan’s 4.25% rate if you win more than $5000 and the amount you won is at least 300 times larger than the amount you wagered.
Tax day isn’t all bad for sports gamblers, though. Just as the government can tax you on your winnings, you can write off and deduct your losses. Of course, that means you have to lose a bet (which isn’t an inviting scenario) but at least there is a financial windfall if you don’t win.
One nice thing is that Michigan has one of the lowest gaming taxes in the entire United States: compare their 4.25 percent to the state of New York’s lofty 36 percent levy and breathe a sigh of relief.That comparatively minuscule rate (combined with Michigan’s large population, the tenth-largest in the US) is part of what’s helped the sports gambling industry to explode in the Great Lakes State.
In 2022, Michigan casinos reported nearly $2 billion handled in sports bets placed. That’s no small number, especially when you consider that Michiganders spent nearly $5 billion on lottery tickets last year. The sports gambling industry is already well on its way to catching up with entrenched industries like the state lottery in a mere fraction of the time.
Michigan got off to a fast start this year too: sportsbooks fielded $498 million in bets in January, as the state put up nearly one quarter of last year’s handle in just one month: that’ll slow down a bit in the dead time following the Super Bowl and March Madness, but expect records to continue to fall this year, especially if the Lions’ season turns out well.
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