Yes, casinos do track your winnings, but if you're worried about the IRS, you'd have to be winning big (extremely big) to be flagged. As long as you stay on the right side of the law as far as taxes are concerned, you can rest easy that your online winnings are safe.
It typically involves a series of checks, such as verifying a player's identity documents and checking them against databases. Some online casinos also use biometric identity verification methods, such as facial recognition technology, to ensure that players are who they say they are.