If you’ve ever seen a payout of $4.20 instead of $4.23, you’ve encountered breakage — one of the lesser-known quirks of horse racing. Alongside takeout, these two concepts explain why your exact share of a pari-mutuel pool may not match the math. Knowing how breakage and takeout work can help you better understand true odds, track deductions, and where your money goes after the race.
What is breakage in horse racing?
What is breakage in horse racing?
Breakage is the rounding down of payouts to the nearest set amount — typically to the nearest $0.10 or $0.20, depending on the jurisdiction.
For example:
If your bet returns $2.67, the track may round it down to $2.60.
That extra $0.07? That’s breakage — and it's kept by the track or racing commission.
Breakage rules vary by state and can affect small-bet returns the most.
What is takeout in horse racing?
What is takeout in horse racing?
Takeout is the percentage the track removes from each betting pool before payouts are distributed to winners. It’s used to fund:
Racetrack operations
Regulatory bodies
Purse money (for owners, trainers, jockeys)
Racing industry integrity services
Typical takeout rates:
Win/Place/Show: 15–18%
Exacta/Trifecta: 20–25%
Pick 6 and other exotics: Up to 30%
MyWinners adheres to legal takeout rules set by each US state.
Why do breakage and takeout matter to bettors?
Why do breakage and takeout matter to bettors?
They impact your true return on investment
High takeouts reduce overall value — especially for exotics
Breakage eats into small winnings, especially for favourites
Understanding them helps identify value races and bets
Some states are moving to $0.01 breakage to make payouts fairer
When betting at MyWinners, your ticket and results display the net payout after takeout and breakage, so you always know where you stand.
What should bettors know about these deductions?
What should bettors know about these deductions?
Breakage is often unnoticeable on large bets but can add up
Some racetracks and ADWs (Advance Deposit Wagering providers) retain breakage, while others return it to state funds
Low takeout tracks (e.g., Kentucky Downs) attract sharp bettors
Advocacy groups continue to push for modernised breakage rules
Always consider the impact of takeout when constructing exotic bets.
💡 Did You Know? In 2022, New York passed a bill to reduce breakage — returning millions in extra cents to bettors annually. It’s part of a national push toward more transparent and fair pari-mutuel wagering.
Frequently Asked Questions
Who gets the money from breakage?
Who gets the money from breakage?
Typically, the racetrack or state racing commission retains breakage revenue — though some jurisdictions are pushing for bettor-friendly reforms.
Can breakage affect exotic bets?
Can breakage affect exotic bets?
Yes — especially in low-base exotic bets like the $0.10 Superfecta, where small differences in payout are more noticeable after rounding.
Is takeout the same at every track?
Is takeout the same at every track?
No. Each track and state sets its own rates. MyWinners.com always reflects the official takeout on your bet slip and results.
Can I avoid takeout and breakage?
Can I avoid takeout and breakage?
No — they’re built into the pari-mutuel system. But you can choose tracks or bet types with more favourable takeout rates.
Why don’t sportsbooks have breakage?
Why don’t sportsbooks have breakage?
Because sportsbooks use fixed odds — they round payouts less frequently. Horse racing is unique in using pari-mutuel pools that require rounding and deductions.