Kentucky is like most states in that its gambling laws are vague and enforcement of the law is spotty. The situation can be confusing so my goal with this page is to give you a clear-cut overview of the legal situation for online betting in Kentucky. This will include an explanation of the state’s gaming laws, a list of legal places to bet online and a healthy dose of speculation about the future of online gaming in the state.
Let’s start with the good news. Most forms of internet betting that are legal at the federal level are also legal in Kentucky. This includes online horse racing betting, fantasy sports and skill games. Each state has the ability to prohibit anything that is legal at the national level but Kentucky has no problem with any of those.
The bad news is that Kentucky has no plans in place to join the short list of states that are in the process of legalizing and regulating online sports betting, poker or gambling. States such as Nevada and New Jersey already have a licensing system in place for poker sites and internet casinos. Kentucky probably won’t be joining the party for at least several more years.
List of Legal Betting Sites
Fantasy Sports:
Horse and Greyhound Betting:
Games of Skill:
There’s quite a bit of misinformation regarding what is legal and what is not in Kentucky. Even today, I can run a search on Google for Kentucky gambling sites and find dozens of websites recommending online casinos and poker sites that aren’t actually legal. In most cases, they fail to mention that those sites are located overseas, are unregulated and do break US law by accepting customers from the state.
I don’t mean to pass judgment on other websites, but I would like to let you know the reality of the situation. It’s not a crime for YOU to place bets at offshore sites but those sites most definitely are committing a crime. And not only that, but all of the big legitimate names in the UK and Europe do not do business in the US. This leaves you with smaller, lesser-known operators whose financial conditions are completely unknown.
What you see above is a list of sites that are truly legal in Kentucky. Each one of these is located in the United States and answers to the law of the land right here in the USA. These sites all accept real money customers from Kentucky.
Gaming Laws in Kentucky
Kentucky’s revised statutes provide a good deal of reading material if you’re inclined to read the nuanced details. What stands out as most important are the state’s definitions of “gambling” and what happens if someone is caught partaking in or promoting unlawful gambling.
The state defines gambling as follows:
“…staking or risking something of value upon the outcome of a contest, game, gaming scheme, or gaming device which is based upon an element of chance, in accord with an agreement or understanding that someone will receive something of value in the event of a certain outcome…”
This is interpreted to include poker (both online and real-world) and all other forms of gambling not explicitly legalized in KY. The state does not punish people who participate in gambling as players, but it does consider it a crime to “advance” or “profit from” gambling activity.
The text “profit from” does not include winning money as a gambler. The state defines profiting from gambling as making money in some way other than as a player. For example, you would be considered in violation if you ran your own sportsbook, charged people a fee to play casino games in your house, etc.
Promoting gambling is considered a Class A misdemeanor punishable by a fine of up to $500. This is bumped up to a Class D felony if you operate a bookmaking organization that utilizes 3 or more people and accepts more than $500 in a single day of operating, if you run a lottery scheme that accumulates more than $500 in any one day or if you operate an illegal gambling device. The punishment for which is imprisonment of 1 to 5 years.
The most important things to take away from this are that:
- Poker counts as gambling in Kentucky
- It is not a crime to participate in gambling as a player
- It is a crime to promote, profit from or advance gambling activity
Sports Betting in Kentucky
Kentucky does not yet have legal sports betting, but some lawmakers are intent on seeing that change. A bill introduced by Senator Julian Carroll in 2017 wants to legalize sports betting now that the federal prohibition of sports betting has ended.
BR 155 amends Kentucky gambling laws to allow sports wagering, calls for a $250,000 licensing fee for operators, sets a 20% tax on betting handle and establishes the Kentucky Horse Racing Commission as the agency in charge of regulating sports betting.
The 20% tax on betting handle is entirely too high considering the average sportsbook in Nevada is only able to retain 5% of total betting handle after paying out winnings. A 20% tax on handle would make it absolutely impossible to run a profitable sportsbook. But, as Legal Sports Report optimistically noted at the time, it is at least a way to start the conversation.
For the bill to take effect, it plainly stated the federal Professional and Amateur Sports Protection Act (PASPA) must be repealed, amended or stricken down in such a way to make it legal for Kentucky to regulate sports betting. After the Supreme Court ruled against PASPA in May of 2018, it opened the pathway for this bill to make real progress.
At the time the bill was introduced, the most likely avenue for PASPA to be ended was a Supreme Court case pitting New Jersey against the major North American sports leagues. New Jersey had passed a law effectively legalizing sports betting, and the sports leagues sued to stop the law from taking effect. New Jersey challenged the constitutionality of PASPA and the case went all the way to the Supreme Court.
Before the Supreme Court issued a ruling, many predicted it would rule in favor of New Jersey and possibly strike down PASPA as unconstitutional. Kentucky and a number of other states got an early start in crafting sports betting legislation just in case – and were rewarded when the Supreme Court did indeed strike down PASPA.
Future of Online Poker and Casinos
Kentucky won’t be voted “most likely state to legalize online poker” any time soon. This is, after all, the state that seized 141 poker and gambling domains in 2008 with no notice to the defendants. The Commonwealth of Kentucky argued that the sites in question accepted wagers from players within the state in flagrant disregard of Kentucky law.
The domain owners never even had a chance to make the case that Kentucky had no jurisdiction to enforce its laws over domains hosted in completely different countries. Nevertheless, Kentucky moved to take the domains. PokerStars later agreed to pay $6,000,000 to gets its domain back while many of the other sites simply moved to other URLs.
On a more positive side, Kentucky does embrace some forms of online betting now. The state has no problem with online fantasy sports, horse betting and skill games. Some other state have recoiled at the thought of even those forms of online wagering, but Kentucky has so far shown no interest in prohibiting those activities.
What’s missing now is any desire to change the current state of affairs. At the time of this writing, there are no initiatives to bring online casinos or poker to the state. This could change at some point but as of now, it’s a waiting game.
Fantasy Sports Sites in Kentucky
The major fantasy sports sites operate in Kentucky due to the prevailing interpretation of Kentucky gambling law being favorable to DFS. The next step for Kentucky fantasy sites is to achieve firm legal clarity with the passage of DFS legislation.
Lawmakers attempted to do exactly that with HB 414 introduced in February of 2017. That bill made it to a full house vote and received a favorable vote of 37-36, but came up short of the 40 votes required to send that bill to the Senate.
If successful, HB 414 would have been an excellent bill for the daily fantasy industry. It sought initial licensing and annual renewal fees of just $5,000 and established a tax rate of 6%. Furthermore, if the tax bill for the year came out to more than $5,000, the initial registration or annual renewal fee could be used to offset taxes due for the year.
Although the bill was defeated, players can take heart knowing it wasn’t defeated due to overwhelming opposition. The lack of success ultimately came down to apathy more than any sort of deep-seated anti-DFS sentiment in Kentucky. The issue simply does not register very high on the list on the list of priorities for most lawmakers. Today, it is business as usual for the daily fantasy industry in Kentucky.
