Sweepstakes Casinos in Connecticut

Stakester's Take

Connecticut players should focus on these top sweepstakes casinos while they remain available, as pending legislation may soon eliminate access. These operators offer the best experience for Connecticut residents:

Connecticut's Sweepstakes Casino Laws: Legal Status Explained

Connecticut's sweepstakes casino legal situation is in flux, with major changes anticipated by June 2025. Sweepstakes casinos have historically operated in a legal gray area nationwide using a dual-currency model to avoid classification as gambling operations.

Current Legal Framework

Currently, sweepstakes casinos technically remain legal but operate under the promotional sweepstakes model that allows players to participate in casino-style games through a virtual currency system (typically Gold Coins and Sweeps Coins). However, this status may soon change.

Pending Legislation: Senate Bill 1235

Senate Bill 1235, which has passed Connecticut's Judiciary Committee with a 37-0 vote and the Joint Committee on General Law with a 22-0 vote, directly targets sweepstakes casinos.

The bill explicitly prohibits:

1. Online sweepstakes casinos
2. Lottery ticket resales and courier services
3. Any sweepstakes or promotional drawings that allow or facilitate participation in "real or simulated online casino gaming or sports wagering"

If passed, these operations would be classified as illegal gambling businesses subject to Class D felony charges, which carry penalties of up to five years in prison and $5,000 fines.

Broader Online Gambling Landscape

In 2021, Connecticut made it legal for people to play casino games online. The new law allowed the state’s two tribal casinos:

• Mohegan Sun
• Foxwoods

These tribal casinos offer online gambling by teaming up with big companies: Mohegan Sun partnered with FanDuel, and Foxwoods partnered with DraftKings. They launched in October 2021 and let players enjoy slots, table games, and even live dealer games from home.

Only these two casinos are allowed to run online gambling sites in Connecticut, apart from the Connecticut Lottery's online offers. 

Everything is closely watched by the state’s Department of Consumer Protection to make sure it’s safe and fair. Some of the money the state earns from online gambling goes to important programs like education and responsible gambling support.

Connecticut's Gambling Regulator

The Connecticut Department of Consumer Protection (CDCP) is the main regulatory authority overseeing all gambling activities in the state. As the controlling body for gaming, the CDCP has adopted a more stringent approach toward unregulated gambling operations, including sweepstakes casinos.

In early 2025, the CDCP officially recommended anti-sweepstakes legislation that is currently being considered by the state legislature.

With this, the department has already taken enforcement actions against certain operators, including issuing a suspension order to High 5 Games in March 2025 for offering unregulated casino gambling to Connecticut residents, including individuals on the statewide exclusion list.

Responsible Gambling

To ensure robust, responsible gambling requirements for its licensed operators, the Connecticut Council on Problem Gambling (CCPG) works in partnership with the CDCP to provide resources for those struggling with gambling addiction. All regulated Connecticut gambling operators must participate in the state's voluntary self-exclusion program and provide responsible gambling tools.

Sweepstakes casinos, however, typically operate outside this regulatory framework and are not required to offer the same level of responsible gambling protections, a key criticism cited by regulators pushing for the ban.

Tax Requirements

Taxation of sweepstakes casino redemptions in the 'Constitution State' follows general prize winnings guidelines. Here's a breakdown:

Federal Taxation

• All redemptions over $600 require a W-2G form
• Subject to 24% federal withholding for amounts over $5,000
• All winnings must be reported as "Other Income" on federal tax returns

Connecticut State Taxation

• Connecticut imposes a 6.99% state income tax on all gambling winnings
• Redemptions are considered gambling winnings for state tax purposes
• No threshold exemption; all redemptions are technically taxable

How to Report Winnings 

• Operators must issue 1099-MISC forms for redemptions totaling $600+ in a calendar year
• Players are legally obligated to report all winnings, regardless of whether they received tax forms.

Latest Connecticut Regulatory Changes Affecting Sweepstakes Gaming

Recent developments in Connecticut's approach to sweepstakes casinos:

• May 8, 2025: Senate Bill 1235 cleared the Legislative Commissioners' Office and moved to the Senate floor, with passage expected before the June 4 legislative session deadline
• March 2025: Connecticut Senate's General Law Committee unanimously passed SB 1235 by a vote of 22-0
• February 2025: Public hearing on SB 1235 held on February 14, showing broad support for prohibitions
• January 2025: CDCP investigation found 1,100 Connecticut customers had played at unregulated sweepstakes sites, with 911 of those players losing a collective $937,938
• December 2024: CDCP formally recommended legislation to prohibit sweepstakes casinos, citing consumer protection concerns