Michigan Sweepstakes Casinos

Stakester's Take: Michigan 2025

As of mid-2025, sweepstakes casinos are no longer legally available to players in Michigan. The Michigan Gaming Control Board (MGCB) has issued numerous cease-and-desist letters to both offshore and sweepstakes casino operator. With active enforcement and the threat of legal action, nearly all sweepstakes casinos have withdrawn, closing this previously popular avenue for online casino-style gaming in Michigan.

Michigan's Sweepstakes Casino Laws Explained

Michigan law prohibits all forms of gambling unless specifically authorized by statute. Sweepstakes casinos that use dual-currency systems or offer prizes of monetary value are considered illegal unless they are licensed by the MGCB. The MGCB has cited violations of the Lawful Internet Gaming Act, the Michigan Gaming Control and Revenue Act, and the Michigan Penal Code in its enforcement actions.

Key Updates:

• Comprehensive Prohibition: Any online casino-style games, lotteries, raffles, or sports betting platforms using virtual currencies or prizes of value without a license are illegal.
• Enforcement Actions: The MGCB has issued dozens of cease-and-desist letters since late 2023, targeting both offshore and sweepstakes casino operators. Notable brands have left the market following these actions.
• Who Is Affected: The ban covers operators, payment providers, affiliates, and suppliers involved in these platforms.
• Penalties: Operators face legal action and possible referral to the Michigan Attorney General’s Office if they fail to comply within 14 days of receiving a cease-and-desist letter.
• Regulatory Oversight: The MGCB, supported by the Attorney General, leads investigations and enforcement, often using undercover operations and geofencing technology to identify and block illegal operators.

Sweepstakes casinos are no longer a legal option for Michigan residents. The state has decisively closed the legal loophole that allowed these platforms to operate, and enforcement is ongoing.

Michigan's Gambling Regulator

The Michigan Gaming Control Board (MGCB) regulates all gambling in the state, including casinos, sports betting, and charitable gaming. The MGCB is recognized for its strict enforcement and proactive approach to online regulation, frequently issuing cease-and-desist orders and working closely with law enforcement and the Attorney General’s office. The Board’s criminal investigations unit now focuses primarily on illegal online gambling, with undercover investigations and rapid response to complaints.

Responsible Gambling in Michigan

Licensed Michigan online casinos must provide robust responsible gambling tools, including:

• Deposit, loss, and session limits
• Voluntary self-exclusion programs
• Age verification and parental controls

The MGCB also partners with state and national organizations to offer problem gambling resources, such as the Michigan Problem Gambling Helpline and the National Council on Problem Gambling. These tools are not reliably available on unlicensed or sweepstakes platforms, which is a key reason for the regulatory crackdown.

Tax Requirements at Michigan Sweepstakes Casinos

All gambling winnings, including those from sweepstakes, are taxable at both the federal and state levels:

• Federal tax: 24% withholding on winnings over $5,000; all winnings must be reported as income.
• Michigan state tax: Flat rate of 4.25% on gambling winnings.

Licensed operators may withhold state taxes, but players are ultimately responsible for reporting and paying taxes on all prizes and redemptions, typically via IRS Form W-2G and Michigan Form MI-1040.

Latest Michigan Sweepstakes Casino Regulatory Changes

Cease-and-Desist Orders: In June 2025, the MGCB issued new cease-and-desist letters to five more unlicensed online gambling sites, continuing its aggressive enforcement trend.

• Scope of Ban: The state prohibits all unlicensed online casino-style games, lotteries, raffles, and sweepstakes that use virtual currencies or offer prizes of value.
• Penalties: Non-compliant operators face legal action, potential fines, and referral to the Attorney General’s office.
• Enforcement: The MGCB, with support from the Attorney General, investigates and blocks illegal operators, using undercover techniques and technology to enforce compliance.

Status: There is no current legislative movement to legalize or regulate sweepstakes casinos. The MGCB’s strict enforcement of existing laws has effectively eliminated these platforms from Michigan, making it one of the most restrictive states for sweepstakes casino gaming in the U.S..