Polymarket and Kalshi in Texas
Current access status and legal context for prediction market users in Texas. Kalshi is available under federal CFTC authority; Polymarket geoblocks all US residents.
Short answer for Texas residents: Polymarket geoblocks US IPs; users typically access it via a VPN and crypto deposits (no KYC at signup). Kalshi is the CFTC-regulated US exchange available under federal designation regardless of state law.
Polymarket in Texas
Blocked by IP. Texas has one of the largest prediction market interest bases in the US despite restrictive state gambling law.
Access via VPN and crypto deposits is the typical US-user path. Polymarket does not require KYC at signup — identity checks trigger only at large fiat offramps, where US IDs can lead to account restriction. Gains are US-taxable; Polymarket does not issue 1099s.
Kalshi in Texas
Available. Kalshi is used extensively in Texas despite the absence of legal sports betting.
PredictIt in Texas
Available.
Texas sports betting law
No legal sportsbooks (constitutional amendment required).
State gambling law
Tex. Penal Code §47.
For federally-designated contract markets (DCMs) like Kalshi, the Commodity Exchange Act and CFTC jurisdiction provide preemption over state gambling statutes. This means Kalshi operates legally in Texas even though the state itself may restrict unlicensed online gambling.
Tax treatment in Texas
No state income tax.
Kalshi issues IRS Form 1099 to customers whose gains exceed reporting thresholds. Gains are federal ordinary income and flow through to Texas state income tax (where applicable). For detailed tax planning, see our sister site polytaxes.com.
Common questions from Texas users
Can I use Polymarket from Texas with a VPN?
Yes, technically — and the typical US-user path. A non-US IP via VPN plus crypto deposits (USDC on Polygon) gets you a working Polymarket account with no KYC at signup. KYC triggers at fiat offramps, where a US ID can result in restrictions. Keep withdrawals to self-custody crypto wallets if you want to avoid that.
Does Kalshi report my gains to the IRS?
Yes. Kalshi issues 1099s. Gains are federal ordinary income or short-term capital gains depending on activity.
Does Polymarket report my gains to the IRS?
No 1099 from Polymarket. US users are personally responsible for reporting gains.
What happens if Texas passes its own prediction-market rule?
State-level rules cannot override federal CFTC designation for event contracts — this is the preemption question at the heart of several 2024–2026 court cases between Kalshi and various state regulators. Kalshi has consistently prevailed at federal court level.
Related states
Last verified: April 16, 2026. Nothing on this page constitutes legal or tax advice.