Winnings subject to withholding
(b) Winnings subject to withholding(1) In general. Winnings subject to withholding means any payment from (i) A wager placed in a State-conducted lottery (defined in paragraph (c)(2) of this section) but only if the proceeds from the wager exceed $5,000; (ii) A wager placed in a sweepstakes, wagering pool, or lottery other than a State-conducted lottery but only if the proceeds from the wager exceed $5,000; or (iii) Any other wagering transaction (as defined in paragraph (c)(3) of this section) but only if the proceeds from the wager: (A) Exceed $5,000; and (B) Are at least 300 times as large as the amount of the wager. (2) Total proceeds subject to withholding. If proceeds from the wager qualify as winnings subject to withholding, then the total proceeds from the wager, and not merely amounts in excess of $5,000, are subject to withholding.