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Bonus Bets Explained: What "Bet $5, Get $200" Actually Pays

✓ Last verified: 2026-08-13

Yes, the bonus arrives. No, it is not $200 you can withdraw. A “bet $5, get $200” offer pays in bonus bets, which are credits that behave differently from cash in one decisive way: when a bonus bet wins, the sportsbook keeps the stake and pays you only the profit. A winning $25 bonus bet at a standard price puts about $22.73 in your wallet. A winning $25 cash bet at that same price puts $47.73 there. The credits also expire, usually in about a week, and you cannot withdraw them.

That is the whole trick, and it is not hidden. It is written in the operators’ own help pages and, in two states, it is written into the regulations. What follows is the mechanism, not any particular offer. Headline numbers change every few weeks and differ by state, so the durable skill is reading the structure.

Bonus bets versus site credit: the distinction that decides the value

These two get used interchangeably in marketing and they are not the same product. FanDuel’s own explainer draws the line in one sentence: “With Bonus Bets, only the winnings are returned to you. You will not get the stake returned as cash in your wallet. If you’re using site credit, the stake will also be returned to you if your bet wins.”

So site credit behaves almost like money, and a bonus bet does not. Their own worked example: put $5 of bonus bets on a spread, and if it wins, “your winnings will be added to your wallet, but the $5 in Bonus Bets you wagered would not be included.”

A few more mechanics from the same page, captured in January 2026:

Read that as a checklist rather than as gospel. Terms change, and “unless otherwise stated” is doing real work in that sentence.

What “$200” is actually worth

Here is the arithmetic, which is ours and which you can redo in ten seconds.

At -110, the standard price on a point spread, a $25 bonus bet returns $22.73 if it wins and nothing if it loses. The sportsbook’s own price implies a 52.4% chance of winning. Expected cash is therefore about $11.91, roughly 48 cents on the dollar of face value.

Now put the same credit on a longer price. At +300, a $25 bonus bet returns $75 if it wins, at an implied 25% chance, so expected cash is about $18.75, roughly 75 cents on the dollar.

Both numbers use the book’s own implied probabilities, which include its margin, so the true figures sit a little lower. The direction is what matters, and it explains the one piece of genuinely useful bonus-bet advice: longer odds convert better, because the forfeited stake is a fixed cost that shrinks relative to a bigger payout. A “$200 bonus” is realistically worth somewhere around $100 to $150 in cash terms depending on how you use it, and only if you use all of it before it expires.

The five shapes an offer takes

The word “bonus” covers products that work differently. One operator’s own menu lists five side by side:

The question worth asking of any of them is the same: when this pays, does it pay cash or credit, and if credit, does the stake come back?

The fine print that costs people money

Four items, in rough order of how often they bite:

  1. Expiry. Unused credits are worth zero. A seven-day window across a slow sports week is the most common way a bonus evaporates.
  2. The order your funds are used. If you have both cash and bonus funds and the app spends the wrong one, you have quietly bet real money. Massachusetts is the state that forces this to be disclosed, which tells you how often it matters.
  3. Minimum odds. Many offers refuse to count a heavy favorite, which is precisely the bet most people would use to bank the credit safely.
  4. Playthrough on matched deposits. Ohio’s rule draws the line clearly: a book “may require promotion or bonus funds be played through in order to be withdrawn but must not restrict the patron from withdrawing their own funds or withdrawing winnings from wagers placed using their own funds.” They can lock the bonus. They cannot lock your money.

The word “free” is regulated, and two states regulate different things

The reason the industry says “bonus bets” today, and said “free bets” and “risk-free bets” a few years ago, is that regulators went after the language. The two clearest rulebooks attack it from opposite ends.

Ohio regulates the offer. Ohio Adm. Code 3775-16-09(C), effective October 26, 2024, says promotions “described as free or risk-free must not require the patron to incur any loss or risk their own money to use or withdraw winnings from the free wager.” That is a truth condition, not a ban on a word: you may call it free if it is free. Almost none of these offers can meet that test, which is why the word left. Ohio’s advertising rule contains no word ban at all.

Massachusetts regulates the sentence. Under 205 CMR 256.04(6)(c), an advertisement may not “imply or promote Sports Wagering as free of risk in general or in connection with a particular promotion.” A separate provision, (6)(d), covers describing wagering as “free,” “cost free,” or “free of risk” where the player has to risk their own money.

That distinction is not academic. In August 2024 the Massachusetts Gaming Commission fined Penn Sports Interactive $25,000 over a promotion captioned “Big Cat’s Can’t Lose Parlay,” which bundled four NCAA basketball games played on March 10, 2023. The Commission found a violation of the imply prong, not the “described as free” prong. Nobody in that case used the word “free.” They used the words “can’t lose.” In October 2025 the same operator was fined $15,000 after an ESPN broadcaster described a wager on air as a “risk-free investment.”

What the rules actually entitle you to

Massachusetts also wrote the most useful promotional-offer rule in the country, 205 CMR 247.09, and it is worth knowing even if you bet elsewhere, because it names every term an offer is capable of hiding.

Operators there “shall fully and accurately disclose the material terms of all promotional offers at the time such offers are advertised.” Then the line that has real teeth: “If the material terms of a promotional offer cannot be fully and accurately disclosed within the constraints of a particular advertising medium, the promotional offer may not be advertised in that medium.” If it does not fit on the billboard, it does not go on the billboard.

The terms that must be disclosed include the dates the offer runs, eligibility requirements, any restriction on withdrawals, wagering requirements, the order in which funds are used for wagers, and the rules for cancellation. Two more provisions are worth quoting almost in full:

Use that list as a template anywhere. If your state’s rulebook does not require these disclosures, the terms still exist. You just have to go find them.

Why the same offer is worse in your state

Promotions are a marketing budget, and two things in state law set its size.

The tax rate. Operators in New York pay 51% and in Pennsylvania 36%, against 10% in Arizona and 8.4% in Michigan. Less kept per dollar means thinner offers and slightly worse prices. New Jersey ran that experiment in public when it went from 13% to 19.75% in July 2025.

Whether promo spending is deductible, which is less visible and moving faster. Several states are removing the deduction that let books write off the bonuses they hand out:

A bonus that costs the operator more is a bonus that gets smaller. If offers in your state look worse than the ones in the ads, this is usually why, and it has nothing to do with you.

Advertising rules differ too. Colorado’s SB26-131 has banned promotional text messages and push notifications since August 12, 2026. Maryland bans “risk-free” language. Ohio requires every direct advertisement to describe an opt-out method and requires the operator to act on the request within fifteen days, which is the most concrete thing on this page you can do today if the notifications are the problem.

The tax bill nobody mentions in the ad

Winnings from a bonus bet are ordinary taxable income, exactly like winnings from cash. There is no special treatment because the stake was not yours.

The offset changed on January 1, 2026. Section 70114(a) of the law enacted as Public Law 119-21 on July 4, 2025 amended 165(d) so that the wagering-loss deduction is 90% of losses, and still only up to your total winnings. Read the order carefully, because it is commonly published backwards: the 90% applies to your losses, and the result is then capped at your gains. Treasury and the IRS put the implementing regulation out as a proposed rule on April 17, 2026, so the statute is settled and the regulation is not.

For most people, though, the 90% is not the operative rule at all. Treasury’s own words: “For taxpayers who do not itemize deductions no deduction may be claimed for wagering losses.” Of roughly 2.3 million taxpayers who reported wagering gains in 2022, fewer than a third itemized. If you take the standard deduction, your winnings are taxable and your losses are worth nothing, which is the real reason a break-even year can still produce a tax bill.

Frequently asked questions

Do you really get $200 from DraftKings? You really get $200 in bonus bets, which is not $200 in cash. Bonus bets pay only the winnings and keep the stake, so $200 of credits converts to roughly $100 to $150 depending on the odds you use them at, and to nothing if you let them expire.

Can you withdraw bonus bets? No. The credit itself is never withdrawable. Winnings generated by a bonus bet land in your cash balance and can be withdrawn, subject to whatever playthrough the specific offer imposed.

What happens if I do not use them? They expire, commonly in about seven days, and the value is gone. Check the expiry on your account page rather than assuming.

Are bonus bets taxed? The winnings are, as ordinary income. See above on why the loss deduction probably will not offset them.

Why are the offers in my state smaller? Higher state tax rates and the loss of the promotional-spending deduction. Both are described above with the states doing it.

If any of this is landing because the promotions are the problem rather than the bets, our responsible gambling page lists deposit limits, self-exclusion and the national helpline, and the opt-out route in Ohio’s rule works in a lot of other states too.

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