Are Polymarket wins taxable?
Yes, Polymarket wins are taxable. Similar to other forms of gambling winnings, profits from prediction markets must be reported as income.
According to IRS Topic 420, you must include in gross income the fair market value of goods or services received from betting activities. Wins on Polymarket should be reported on your tax return, either on Schedule C if related to a business activity or Schedule 1 for personal income. If you receive Form 1099-B from a barter exchange, this must be reported.
Important considerations: Estimated tax payments may be required for significant winnings. Losses cannot necessarily be deducted against winnings for personal bets. Tax treatment may differ for those who trade as a business.
Consult a tax professional for personalized advice.