The Law Office of Melanie L. Ryan, LLC  •  9 Cottage Place, Nutley, New Jersey 07110  •  917.346.6547

IS MY FANTASY POOL ILLEGAL?

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It may be......right now the two biggest online fantasy companies, Fan Duel and Draft Kings, are under seige by the NY courts as prosecutors liken participation in fantasy leagues as "games of chance" and a defacto "lottery."   Organizers of fantasy pools such as Fan Duel and Draft Kings argue that their their games are "skilled based" and not at all gambling of the chance sort.  The IRS has long considered gambling winnings reportable, as it does any income whatsoever, regardless of the legality of the activity.  No big surprise that federal and state interests would arise in this arena, but what about how these developments relate to you as as a fantasy sports league player?  Historically, neither the IRS or state regulators will shut down an office or family/friends pool where the stakes are small and the pool administator pays out all fees as winnings, but technically, it is gambling.  They arent going to be too concerned when the enforcement costs are more than the winnings in local pools, but the winnings on Fan Duel and Draft Kings can go into the hundred of thousands,  Long story short, if you are on Fan Duel or Draft Kings, just make sure you report any winnings to the IRS! 

The Law Office of Melanie L. Ryan, LLC

9 Cottage Place
Nutley, NJ 07110
917.346.6547

Contact Melanie