Do FanDuel automatically deduct taxes from winnings?

Yes, FanDuel does automatically deduct taxes from winnings. When a player has net earnings that exceed $600 in a year, FanDuel is required by the Internal Revenue Service (IRS) to issue a 1099-MISC tax form to the winner and report those winnings to the IRS. For certain larger prizes, usually over $5,000, FanDuel will withhold federal taxes at a standard rate and issue a W-2G form instead. This ensures that the necessary taxes are collected upfront. However, it is important for winners to understand that they may still be responsible for any additional state taxes or for reporting their winnings if they fall below the reporting thresholds. Players should consult with a tax professional to comply fully with all tax requirements and to understand their individual tax liability.