Rhode Island Lottery Issues Consumer Alert on Offshore Betting, Updates Guidance on Taxes, Withdrawals and Responsible Play for State Sportsbook and Bally's Online Casino

12 October 2026

The Rhode Island Lottery has issued a consumer alert warning about the risks of using offshore sportsbooks, while also reinforcing key legal and responsible-play considerations for bettors using the state's regulated platforms.

Offshore Sportsbooks in Cite's Crosshairs

In October 2025, Rhode Island regulators sent cease-and-desist letters to six offshore sportsbooks they deem illegal in the state: BetUS, BetOnline, Bovada, MyBookie, WildCasino, and YouWager. "These operators are operating in clear violation of Rhode Island law," a Lottery spokesperson said. "We are working with law enforcement to ensure these companies stop illicitly targeting Rhode Island residents."

Regulators acknowledge the global nature of offshore gambling operations, but they are clear that putting wagers with these firms is unregulated and carries financial risks that don't apply to the state-authorized platforms.

State Sportsbook Rules and Access Restrictions

Rhode Island's licensed online sports wagering platform is Sportsbook Rhode Island, a product of the state Lottery that has been operating since late 2019. Player guidance from the Lottery emphasizes that bettors must be physically located in Rhode Island to place sports wagers, and the RhodyBet mobile app uses geolocation to verify a user's presence within state boundaries.

The Sportsbook Rhode Island wallet is similarly access-restricted. "You must be physically located in the State of Rhode Island in order to access your wallet," the Lottery’s player FAQ explains. Wagers and wallets are location-locked, and the Lottery's guidance warns that GPS location tracking is used to enforce the in-state rules.

Play It Right: Taxes and Reporting

The Rhode Island Lottery's 2025 RFQ for sports wagering platform services spells out the tax and reporting requirements that will apply to winning players. Bets that pay out 300 times their stake or more (at a minimum $2,000 payout in 2026) will trigger a Form W-2G from the Lottery to both bettor and IRS. Bets scoring at least $5,000 in profit, moreover, will have federal income tax automatically withheld at 24%, a 5.99% state income tax withheld on top of that, and all such amounts withheld are offset against state child-support obligations.

"I think some big winners are going to be surprised by these demands, especially with the Layer that taxes come due no matter where the bets were placed," said industry analyst Reid Boshek. The Lottery declined to comment.

Responsible Gaming and Customer Support Options

Aware that online betting carries heightened odds of problem gambling, Rhode Island is trying to steer players to find help. The responsible gambling options, though limited, cover familiar ground: play managers with tools to set time-outs, wager limits, and session durations. A hotline at 1-877-9GAMBLE is available 24/7 for callers who feel they or their loved ones are being pulled too hard into gaming.

"This is realistic - we're establishing a system to catch problems, but I'd welcome more accountability," said Josiah Johnson of the Responsible Gambling Association. In addition to the hotline, the Rhode Island Lottery offers both an in-app information center and a link to the National Problem Gambling Helpline.

Bally’s iCasino Includes Online Options

Bally's also operates an iCasino under an arrangement with the Rhode Island Lottery, and regulators are keen to establish guardrails for table games and slots. The taxation and reporting rules are unchanged from sports betting, though the responsible gambling language in the lotteries RFQ suggests that the social risks are the same, and operators will be expected to address them. The RFQ invites bidders to describe their own responsible gambling toolkits, and hints that the Lottery is open to providing players with shared services that reinforce responsible action (though shared wallets are specifically referenced).

The unchanging message: Rhode Island takes responsible gaming and compliance seriously for its regulated operators, but bettors should be aware of the limits on wallet access, and the state’s robust commitment to collecting taxes and enforcing in-state-only access rules.