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Texas Senate committee hears views on prediction-market sports contracts

Regulation

The Texas Senate State Affairs Committee heard testimony on whether the state could limit prediction-market platforms offering sports event contracts, according to the reported account. American Gaming Association vice-president Tres York urged legal action against the operators, while Kalshi legal and compliance head Robert DeNault argued that advertising limits, risk disclosures and protections for younger customers could address concerns without a ban.

Any state restrictions could affect prediction-market platforms offering sports contracts in Texas.

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Regulation

Tax Law Center urges wagering tax treatment for US sports prediction contracts

It was reported that the Tax Law Center published an analysis on 1 October arguing that US sports prediction contracts qualify as wagers for federal taxation. Its interpretation would bring these contracts within gambling provisions covering excise taxes, winnings and loss deductions. The analysis calls for IRS clarification to reduce uncertainty.

An analysis from the Tax Law Center, dated Oct. 1, examines whether contracts tied to sporting events on venues like Kalshi belong within the federal rules that govern gambling. The center's position is that such contracts amount to wagers for federal tax purposes.

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