IRS silent on tax treatment for $25B World Cup prediction market bets

The 2026 FIFA World Cup has become the biggest event in prediction market history, with trading volumes potentially exceeding $25 billion across platforms like Polymarket and Kalshi. And yet the IRS, the agency that usually has an opinion on everything involving money, has said precisely nothing about how traders should report their winnings. The numbers are staggering Polymarket’s “World Cup Winner” market alone has surpassed $3.9 billion in trading volume as of early July 2026. Combined World Cup-related volumes from both Polymarket and Kalshi are estimated between $4.8 billion and $6.4 billion, with broader estimates that include all associated betting activity pushing the total past $25 billion. Much of this trading is conducted using stablecoins, which adds another layer of complexity to the tax question. The CFTC, which regulates both Kalshi and Polymarket, watched volumes surge dramatically in June 2026 as World Cup excitement took hold. The tax question nobody can answer The IRS has not issued specific guidance on the taxation of prediction market contracts as of July 2026. That leaves traders guessing between two very different tax treatments, each with materially differen...