Everyone likes to place a wager now and then as it adds some excitement to the day. However, for those who are looking to place large sums of money on upcoming sporting events, there are plenty of terms and conditions that they need to be aware of. If you’re looking to place a bet on a sporting event, then you need to understand exactly what -130 means.
The Odds Are Always In Your Favor
When you bet on a sporting event, the house always wins in the long term. The reason for this is somewhat complicated and has to do with the vigorish (or vig) that is levied upon the losing side of the bet. Let’s take a look at how this works in practice.
When you place a wager on a horse race, for example, the odds will always favor the horse. This is because the racecourse bookmakers (the “house”) have to pay out more money on losing bets than they receive in winnings. This is done to discourage people from placing wagers because they know the house will eventually win. It’s the law.
The term “vigorish” refers to the percentage of money that the bookmaker takes as a commission for placing a wager. For every dollar that you wager, the bookmaker will take 30 cents. So when you win $100, they’ll give you $70 and keep the other $30 as commission. This is standard practice in the industry.
Don’t Forget The Taxes
When you win or lose money on a bet, there are several different taxes that you need to be aware of (aside from the standard federal & state income tax).
In the case of a win, you’ll need to pay federal excise tax on winnings at a rate of 20% (or 25% if you’re a non-registered Independent contractor). If you’re a professional gambler and you win $10,000 in one month, you’ll have to pay $2,000 in taxes (state and federal combined).
You’ll also need to pay Medicare tax on your winnings (at a rate of 2.9% or 3.8% if you’re married filing jointly or separately).
In the case of a loss, you’ll need to pay federal excise tax at a rate of 40% (or 50% if you’re a non-registered Independent contractor) on your winnings. You’ll also need to pay state sales tax on your losses (at a rate of 6.0% if you’re in California, for example). In some instances, you might also need to pay city sales tax as well (in the case of an online gambling operation, for example).
You Need To Follow The Rules
While it’s always great to have good fortune coming your way, it’s also important to keep in mind the rules that got you there. If you make a habit of breaking the rules, you might end up in a situation where you lose everything. So it’s important to know what the bookmakers’ terms and conditions are before you start placing bets.
The most important thing to keep in mind is this: if you’re trying to make money playing sports, you’re going to need to put in the work. It might not be possible for a beginner to turn a profit in the long term unless they’re exceedingly lucky. This is probably not what you want to hear, but it’s important to keep in mind.
So if you’re looking to place a bet on a sporting event, then you need to understand what -130 means before you start laying down your dollars. The good news is that it doesn’t have to be this way. If you learn to abide by the rules and follow the procedures, you have a legitimate chance of profiting from gambling. Even if you lose some money in the short term, as long as you continue to bet and follow the advice laid out here, you will eventually come out ahead. The key is to be patient and take it one step at a time.