Is Sports Betting Legal?

Online sportsbooks may generate over $4 billion per year, but there are plenty of American residents still wondering the answer to one question - is sports betting legal in the United States? The answer is both yes and no depending on the type of sports betting that you are interested in. Offshore online sportsbooks are legitimate betting sites that are licensed to accept players from the U.S. These sites follow the regulations outlined in their jurisdiction and are able to provide American bettors with legal Vegas-style sports betting action online. The legality of land-based sports betting is more complicated due to the federal and state laws that exist in the states. Rather than having to research every piece of legislation related to U.S. sports betting, we can provide you with a crash course.

The good news is that there are not as many sports betting laws in the U.S. as you would think. We will walk you through the most important laws to know and also give you more information on legal online sports betting sites. By the end of the guide, you should have a clear picture of the legal sports betting landscape in the United States, along with the online sports betting sites that are safe to use.

In 1992, PASPA, also known as the Professional and Amateur Sports Protection Act, was enacted by the 102nd United States Congress. With the exclusion of four states, PASPA outlawed sports betting all over the nation. During the late 80’s and early 90’s, the United States saw an expansion of gambling which they thought would lead also lead to the growth of legal sports betting. By making it illegal to issue new sports betting licenses, PASPA was able to stop the potential proliferation of betting on sports.

The four states that were exempted from the Professional and Amateur Sports Protection Act had pre-existing sports betting laws prior to the law being passed. Delaware permitted NFL parlays, which is why you will still find this type of wagering available within the state. Nevada was the only state offering single-game wagering, while Oregon and Montana had written laws for sports lotteries. Oddly enough, OR and MT have prohibited sports betting within the state.

New Jersey has been in an ongoing legal battle to have PASPA declared unconstitutional in order to bring legalized sports betting operations to the state. While they have not had much success as of yet, it is possible that we could see land-based sportsbooks in more states around the nation in the coming years.

The Wire Act of 1961 is one of the first laws that directly targeted the United States sports betting industry. During the era, the sports betting taking place outside of Las Vegas was operated by illegal bookies that were involved in multiple racketeering schemes. The Wire Act sought to put power back into each of the individual state’s hands by enforcing penalties on those that used “wire communication facilities” to accept interstate sports wagers and/or transmit information related to sporting events.

There was no internet back in 1961, and the law only applied to telegraphs and telephone communications. In today’s age, however, the Wire Act has been interpreted to include the internet. A 2011 memo from the Department of Justice clarified that the law only applies to sports wagers rather than all types of online betting. The positive aspect of this law is that it is explicitly clear that it only applies to U.S. operators of sports betting sites, not those placing bets.

The UIGEA stands for the Unlawful Internet Gambling Enforcement Act of 2006. As deceptive as the title sounds, the law does not make gambling on the internet illegal in the United States. The UIGEA outlines requirements set forth by the Federal Reserve Board and Department of the Treasury for financial institutions in the U.S. regarding online gambling transactions. The UIGEA states that financial entities participating in certain designated payment systems – credit card, ACH, check, wire transfer, and money transmittal services – have policies in place to restrict transactions related to internet gambling.

As with other federal laws, the UIGEA only targets businesses and not casual bettors. The only impact that the law has on betting is that certain banking methods, such as credit cards, may get declined occasionally. That is why offshore online sports betting sites offer several different deposit and withdrawal methods for United States sports bettors.

Many states have taken a backseat when it comes to sports betting laws, instead relying on federal laws for sports betting regulation. There are only a handful of states that even mention the phrase “sports betting” within their law books, which serves as a huge benefit to American sports bettors. None of the federal laws explicitly outlaw using offshore online sports betting sites, which means in 9 out 10 situations these sites are completely legal. Only states such as Montana and Washington have strict laws against all forms of sports betting. You can always check your individual state laws, but even if there are sports betting statutes, they almost always target operators rather than bettors.

SportsbookPayout.com wants you to know that the legal sports betting age in the U.S. will vary by state, and you should always verify this before joining an online sportsbook. The federal government has given each state the power to enforce gambling ages, though this age will either be 18 years old or 21 years old. When you use an online sports betting site, keep in mind that they are based offshore and therefore have different laws. Even if an online sportsbook accepts bettors at an age different than the one required in your state, always abide by your local age requirement.