Got Money on March Madness? Here’s What You Need to Know About Sports Betting

4 min read|Mar 30, 2022|fbtwitteremail

Sports betting doesn't only happen (or stay) in Vegas anymore. As more states legalize it — particularly online — a growing number of fans are looking to cash in on March Madness, the Super Bowl, and more. This year alone, the American Gaming association expects roughly 45 million Americans to wager $3.1 billion on the NCAA men’s March Madness basketball tournament.  

What is sports betting? 

It's when you put money on which team is going to win a game or other factors like how much a team will win by. Oh, and it can also generate significant tax income for local governments. 

Why is betting on sports gaining popularity?

Back in 2018, the Supreme Court ended a federal ban on sports betting. That let individual states join Nevada in legalizing it. Since then, a growing number of states — including huge markets like New York — have legalized gambling on sports, both in-person and online. And has led to Americans wagering more than $87 billion on sports, by some estimates.

How do sports bettors earn money?

They win. And there are a few different ways to place a wager. Here are some of the most common ones:

Money line bets

A money line bet is simply a bet on which team or competitor will win. The final score doesn’t matter. 

Point spread bets

The final score does matter. Betting on the point spread means you wager on a team winning or losing by a certain number of points. So the team you bet on needs to win (or lose) by a certain number of points — aka cover the spread — for you to win your bet. 

Futures bets

As the name suggests, futures bets are wagers on future events. Like when fans bet on a Super Bowl champion before the regular season has even started. 

Prop bets

Short for proposition bets, these are all about the details. Like who wins MVP, how many points a certain player scores, or which team will score first.

Parlay bets

Nothing to do with pirates. Parlay bets combine several different bets. But the catch is you have to win each bet to win your parlay. The payout gets bigger with each wager you win.

…And you get to keep all those winnings?

Absolutely not. If you think taxes on your earned income are annoying, meet taxes on prize winnings. Because you’re legally obligated to tell the IRS about all your gambling earnings and losses. And if you win $600 or more from a sportsbook you’ll likely get a W-2G form on the spot or in the mail.

What are the risks of sports betting?

The obvious one: Losing money. When you place a wager on a sports event, you're betting money on something with an unpredictable outcome. Making it a risk that should be viewed with negative expected returns. Remember: The house always wins. It’s true for casinos, and it’s true for sportsbooks.

Gambling can also be addictive and is heavily regulated for a reason. An addiction can lead to not just financial problems, but also health and relationship troubles, too.

If you or someone you know is dealing with a gambling problem, call the National Problem Gambling Hotline at 1-800-522-4700.

Tips for safely getting into sports betting?

Remember that sports are supposed to be fun. Winning money cheering for your favorite team can certainly add to the excitement, but it’s not worth risking your financial security. So if you’re placing a wager, use these tips to do it safely:

Only bet money you can afford to lose.

Just like you wouldn’t invest money you need to pay your bills, you shouldn’t gamble with money you need. That means if the minimum bet is $500, but that's all you have to pay your rent that's due tomorrow, walk away. 

Do your research.

If you’re going to place a bet, make sure you use sportsbooks that are legal and legitimate. The Better Business Bureau has already reported an increase in sports betting scams.

theSkimm

Sports betting has already begun to transform the world of sports. But it can be devastating for those who lose their fortunes or develop a gambling problem. If you want to get in on the action, make sure you know what you’re getting into and when it might be time to fold.

If you or someone you know is dealing with a gambling problem, call the National Problem Gambling Hotline at 1-800-522-4700.

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Skimm'd by Kamaron McNair, Dae Cason, Megan Beauchamp, and Stacy Rapacon