Free tool
Prediction Market Tax Estimator
A rough guide to what you might owe on a year’s net trading profit. Enter your net profit and your marginal tax rate for a ballpark federal estimate.
This is a simplified estimate for general guidance only — not tax advice. It applies a single rate to your net profit and ignores your state, deductions, losses carried between years, and the specific tax treatment your contracts may receive. The way prediction-market gains are taxed is genuinely unsettled. Always confirm your position with a qualified tax professional.
Not sure of your rate? US federal brackets commonly land around 10–37%. Use your top bracket, and remember your state may add more.
Estimated tax on this profit
This tool gives a rough federal-only ballpark by applying your marginal rate to your net profit. It does not account for state tax, deductions, how losses are treated, or the specific classification of your contracts. It stores nothing and is not a substitute for professional tax advice.
How the estimate works
The calculator takes your net profit for the year — your winning positions minus your losing ones — and multiplies it by the marginal tax rate you enter, giving a simple federal ballpark. For example, a $1,000 net profit at a 24% rate produces an estimated $240 in tax and $760 kept. It is deliberately basic: real tax bills depend on your total income, your state, available deductions, and how your specific contracts are classified.
Why this is only a starting point
The tax treatment of prediction-market gains in the US is genuinely uncertain and still evolving, as our guide to prediction-market taxes explains in full. Depending on your circumstances and how the contracts are characterised, gains might be handled in more than one way, and your state may tax them too. Keeping thorough records of every trade is the single most useful thing you can do to make tax time straightforward. Treat this estimate as a prompt to plan ahead, and get advice tailored to your situation from a qualified professional.
Frequently asked questions
How much tax will I pay on prediction market profits?
It depends on your total income, your state, and how your gains are classified, so there is no single answer. This estimator gives a rough federal-only ballpark by applying the marginal rate you enter to your net profit. Use it for planning and confirm the specifics with a tax professional.
Can I deduct prediction market losses?
Possibly, depending on how your activity is treated and on your circumstances — the rules around offsetting losses vary. This tool simplifies things by using your net profit (winnings minus losses) as the input. For how losses actually apply to you, seek professional advice.
Does this estimator include state tax?
No. It produces a federal-only ballpark and does not account for any state tax, which may add to what you owe. It also ignores deductions and the specific classification of your contracts, so treat the figure as a rough starting point rather than a precise bill.
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