Is Illinois Really Not Complying with the New Tax Threshold of $2000?

I’m at the Hard Rock casino in Rockford, Illinois, and the workers tell me that Illinois isn’t complying with the new $2,000 hand-pay rule. Has Gov. Pritzker taken us out of the Union?

Leaving J.B. Pritzker, a known gambler, aside, this question seems to be a thorny one. Nobody wanted to touch it. Not Hard Rock Rockford, which wouldn’t talk. Not Hard Rock International, which didn’t respond to us. Not Illinois gambling regulators, who were downright smug and evasive. Not even normally chatty Boyd Gaming, which owns the Par-A-Dice casino in Peoria, Illinois.

So we can only wonder if Illinois intends to keep the jackpot-reporting threshold at $1,200 for state-tax purposes, i.e., continued revenue generation. It certainly sounds like it from what you heard at the Hard Rock -- and from the smugness of the regulators questioned about this.

And from what one unconfirmed source told us: "Illinois hasn't aligned with the federal increase for its own purposes. The state continues to treat gambling winnings (including slots) as taxable income at its flat 4.95% rate and maintains a lower threshold tied to the prior federal rules."

To us, this would mean that Illinois casinos are not issuing or would not issue federal W-2Gs for jackpots between $1,200 and $2,000, but are issuing/would issue the state IL-5754 (Statement by Person Receiving Gambling Winnings) in applicable cases. They would, of course, issue W-2Gs for jackpots of $2,000 or higher.

The only other scenario we can imagine is simply the slow implementation of the new rules, which weren’t well publicized when they went into effect on New Year’s Day. Even here in Gambling Central, a.k.a. Las Vegas, casinos have been slow to react. Bob Dancer told us he couldn’t find a compliant machine until January 17.

If anyone in the Land of Lincoln has hit a jackpot between $1,200 and $2,000, we'd like to hear from you about how that process unfolded.

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Donzack Feb-10-2026

Thanks

Grand Victoria/Harrahs in Elgin Illinois related the same information. Wonder why Pritzker  doesn’t gamble in Illinois.

Jeremy Gray Feb-10-2026

Illinois isn’t alone…

I live in Iowa and the Caesars properties (of which there are 4 in the state) sent an explicit email saying the Iowa Lege had not raised the threshold and that state taxes would be taken out from $1200-$1999.99 though a W2G would not issued in those circumstances. 

It sucks that states haven’t aligned; that said, the clarity came so late in the year that most legislatures wouldn’t have been in session. I don’t imagine Illinois will change the threshold unless there’s significant backlash, which given January numbers up as much as they were despite horrible weather, they won’t change it. I’d say Iowa is 50/50 as to whether they change it. I imagine other states are also in that boat too.

hawks242424 Feb-10-2026

Donzack

I'm pretty sure there would be a giant conflict of interest in either actually not allowed or the look of it is why he doesn't gamble in IL.  No matter what he would pay the state flat tax on gambling winnings like everyone else.  Sadly no losses can be written off in IL, also if you pay tax to another state you also have to pay IL tax still.  I assume it's to incentivize residents to gamble in IL.

Joe Nunziata Feb-10-2026

Massachusetts

I hit a $1,200 Video Poker win @ MGM Springfield Mass on Janauary 30. To my surprise, the machine locked up and the slot attendant said they were giving me a W2. After 15 minutes of trying to get the real explanation, I threw up my hands and got my money and W2-G. 

I sent a message to Mass Gaming via their website and the next morning I received this reply:

"The Department of Revenue’s law under Massachusetts General Laws chapter 62B section 2 requires the gaming operators to lock up slot machines at $1,200, issue a W-2G, and check for owed back taxes or child support. The federal threshold of $2K is a separate law by the IRS for income purposes.  In Massachusetts, slot machines will continue to be locked up at $1,200 so that the casino can check to see if any back taxes or child support are outstanding, a W-2G will be provided to the patron and the only time slot earnings will be reported to the IRS is at or above $2K.  -continued-

Joe Nunziata Feb-10-2026

Massachusetts 2

-continued -

...This is a Department of Revenue requirement and part of the agreement between the gaming operators and DOR. "


And the answer to my follow up question to the very professional Mass Gaming lawyer...

"Only individual W2s $2,000 and over will be reported to the IRS."

Larry Stone Feb-10-2026

winning/losing

winning a jackpot is too complicated.  that's why i'm happier when i lose.

Donzack Feb-10-2026

Pritzker

Security could be a problem unless the casino would let him play in a closed room. Probably not as recognizable in Vegas. So,,, is he a whale??

Michael Feb-10-2026

Iowa

My wife hit a $1495 progressive royal on VP at Diamond Jo Worth(Boyd) 2 days ago. Machine locked up. They took state tax only as leg has not updated rule on their end. She was issued a tax form but I have not looked at it yet to see which form. So Federal is updated but state is not in Iowa.

PD89117 Feb-10-2026

W-2Gs under $2000

Rivers Casino in Des Plaines is still issuing W-2Gs for all wins over $1200.  I was not pleased as I received 6 that day (yes I was very lucky!) but only 2 of the 6 were over the new threshold.  I'd love to know if this is the way it will stay as I didn't realize that the states would deviate from federal rules.

Robbie Feb-10-2026

Joe Nunziata

Holy crap Joe!!!  They certainly like to have their noses in your business, don't they??

Will Mass kick in to help you out when you are losing...?

Best of luck to you Joe!

O2bnVegas Feb-10-2026

State tax

It seems some of the confusion is related to state taxes.  Some states require state tax deducted, some don't.  Nevada doesn't.  New Jersey does.  When I hit a couple of over $1200s a few weeks ago in AC the machines locked up, the attendant came, took my players card and ID, went somewhere, came back with the money, no W-2G.  So I don't know how I will be dunned for the NJ state tax.  I was under the impression the $2000 thing did not apply to state taxes from gambling.

Candy

VP Fan Feb-12-2026

Ron Brown

why then would anybody in their right mind play machines in any of those states???

VP4LIFE Feb-24-2026

IL is now at $2k for taxables

That said, most are still locking up at $1,200 and handpaying to "check if you're excluded or if you owe the state money". They just don't print W-2s.In reality, it's so the casinos didn't have to fire most of their slots people since such a huge amount of handpays are between $1,200-$1,999.99.

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