The IRS will increase the W-2G minimum from $1,200 to $2,000 on January 1, 2026. Thereafter, the IRS claims it will raise the threshold annually with inflation. This changed the games that may be played without worrying about a tax form in 2026 and beyond.
Casinos may need more time to adjust to the new rules. Others may intentionally keep the handpay at $1200 to encourage slop attendant tips, while not issuing a W-2G.
Some states will continue to require local taxes to be paid on jackpots from $1200 to $1999. Ohio is known to be one. However, Mississippi raised it to $2000. If you play in states that withhold taxes on jackpots, check local rules.
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Quarter W-2G reporting will almost entirely disappear
Most quarter video poker games are now excluded from the W-2G reporting requirement. The exceptions are large royal flush progressives and games with five wilds. For example, Plaza has a 99% version of Deuces Joker Wild. The quarter denomination pays $2500 when the player makes a hand with all five wild cards.
Half-dollar video poker will remain mostly unchanged
Most half-dollar video poker games remain unchanged because the only handpay is typically for a $2000 royal flush. The main exception is Loose Deuces, a rare game at this denomination. Four Deuces pays $1250 at the $0.50 denomination when five coins are wagered.
I suggested that casinos lower the $0.50 royal flush to just below $2000, like 799 coins for each one wagered. This would prevent triggering a W-2G. There is precedent for this. Some $1 games that normally pay 240 or 250 coins at the $1 denomination only pay 239 to keep the payout at $1195. Hopefully, IGT and the casinos can quickly find a similar solution for $0.50 royal flushes. However, this may only apply to 2026 if the minimum increases in 2027.
The $1 video poker players need help to get the most relief
The $1 video poker players got some relief, but also need some help with some paytable adjustments in 2026. A five-coin royal flush pays $4000, so getting a W-2G there will not change. Four aces with a 2, 3, or 4 kicker in Triple Double Bonus also still gets a handpay at $4000.
Games like Triple Bonus Plus, Triple Bonus, and White Hot Aces pay exactly $1200 on four aces if the paytable is not already adjusted to make it $1195 to avoid this situation at the $1200 minimum handpay level.
Several $2000 payouts exist at the $1 level that could be slightly lowered to avoid the threshold. Four deuces with an ace kicker in Bonus Deuces Wild, four aces with a 2, 3, or 4 kicker in Double Double Bonus, four aces in Super Aces, and four 2s, 3s, or 4s, with an ace, 2, 3, or 4 kicker in Triple Double Bonus, will all trigger $2000 handpays without that change.
Best $1 video poker games to stay under $2000 payouts: Bonus Poker, Bonus Poker Deluxe, Deuces Wild, Double Bonus, Jacks or Better, and Joker Poker.
Several changes to $2 video poker
A $2 royal flush on five coins is $8000. Several other hands stayed above the new $2000 W-2G threshold, including everything already above the limit in the $1 section. The royal flush remains the only handpay in most major games.
Four aces in Double Bonus pays $1600 and is now removed from the handpay category. In Double Double Bonus, four 2s, 3s, and 4s with a kicker and four aces without one are also $1600 and below the new W-2G limit, while four aces with a kicker pays $4000 and stays above it. More exotic aces games like Triple Bonus, Triple Bonus Plus, and White Hot Aces pay over $2000 on quad aces, making all of those games a handpay for that hand at the $2 denomination.
In Joker Poker, five of a kind lands right on $2000. Four deuces in all Deuces Wild games also pay $2000 in standard versions and higher in some exotic ones.
Best $2 video poker games to stay under $2000 payouts: Bonus Poker, Bonus Poker Deluxe, and Jacks or Better.
The $5 denomination gets the most help
Many hands land just above $1200 when five coins are wagered on the $5 denomination. Straight flushes in games without deuces being wild pay $1250 at the $5 denomination on five coins. Double Bonus and Double Double Bonus pay $1250 on quad 5s to kings. That hand is no longer a W-2G handpay.
Bonus Poker would need to drop the four aces payout from 400 coins to get below $2000, as it lands right on the number. The same can be said of all quads on $5 Bonus Poker Deluxe, and four 2s, 3s, and 4s on Double Bonus and Double Double Bonus. Triple Double Bonus becomes tricky, as several special four of a kind hands are above the $2000 W-2G minimum.
This leaves Jacks or Better as the best option for $5 video poker. A royal flush is the only hand above $2000 at $5 Jacks or Better.
The $10 denomination gets tough
No $10 games keep straight flushes out of the $2000 handpay range. Jacks or Better becomes the best option as quads are at $1250. Bonus Poker keeps four fives to kings at $1250. All special quads in Bonus Poker games are $2000 or higher.
Wildcard games are a good option. In Deuces Wild, only four deuces and a natural royal flush are over the limit on the $10 denomination. Bonus Deuces games add more hands. Joker Poker only has five of a kind and a natural royal flush as handpays when the minimum is $2000.
Taxes Must Be Paid on All Gambling Winnings
As a reminder, all gambling winnings must be declared to the IRS, even when they are not large enough to trigger a W-2G. Keep proper records. This article is not meant to be tax advice. Consult with a tax professional before filing your taxes.
