Prediction Markets in Washington

Washington state has restrictive online gambling laws that impact some prediction market platforms. Polymarket and DraftKings Predictions face limitations, though CFTC-regulated platforms like Kalshi remain available.

Prediction markets regulated by the CFTC (Commodity Futures Trading Commission) are generally permitted under federal law across all US states. However, individual states may impose additional restrictions that affect platform availability.

Washington has no state income tax. Prediction market profits are only subject to federal taxation.

At the federal level, prediction market profits are generally reported as capital gains on IRS Form 8949 and Schedule D. The IRS treats prediction market contracts similarly to other financial derivatives. Consult a qualified tax professional for personalized advice.