Fort Smith, AR asked in Tax Law for Arkansas

Q: 2018 tax law? Gambling winnings in 2018. I paid Arkansas State taxes. Was I required to pay Oklahoma? 2018 OK. Tax law?

My tax professional told me the law in 2018 did not require me to pay oklahoma. Now he says they've made the law retroactive. Is that constitutional?

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James L. Arrasmith
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Answered

A: In 2018, the tax laws regarding gambling winnings varied by state. If you won the gambling income in Oklahoma, the state laws at that time would determine your tax obligations there. Generally, states tax income earned within their borders, including gambling winnings.

If your tax professional initially informed you that Oklahoma law did not require you to pay taxes on those winnings, and now states that the law has been made retroactive, this can indeed raise questions about constitutionality. Retroactive tax laws, while not common, are not inherently unconstitutional, but they are subject to specific legal standards and scrutiny. The key is whether the retroactive application of the law meets the legal standards for fairness and reasonableness.

Given this complex situation, it would be wise to seek a detailed review of your case. You might want to consult with another tax professional or a tax attorney who can assess the specifics of your situation, including the changes in Oklahoma tax law and its applicability to your case. They can provide guidance on your rights and options, including any potential challenges to a retroactive tax law.

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