Las Vegas on alert over gambling tax change in Trump bill
Players claim the Big Beautiful Act will end professional gambling in the US.
US.- After Donald Trump’s so-called “One Big Beautiful Act” was passed on Friday, one largely overlooked amendment tucked into the text is raising concerns for the gambling sector. Amid the hundreds of provisions in the more than 1,000-page piece of legislation is a change to how gambling losses are treated under federal tax law.
Section 165(d) of the Internal Revenue Code currently allows US taxpayers to deduct all gambling losses up to the amount of their winnings, which means they pay no tax if they break even from gambling. But from 2026, gamblers will only be able to deduct 90 per cent of losses, which could result in a tax liability even if they make a net loss.
Several professional gamblers, including pro Poker player Phil Galfond have drawn attention to the amendment.
“This new amendment to the One Big Beautiful Bill Act would end professional gambling in the US and hurt casual gamblers, too,” he wrote on X. “You could pay more in tax than you won.”
“A pro who earns $200k/year might have $3m in winnings and $2.8m in losses,” he added. “This means earning $200k and being taxed as if they earned $480k. This applies to both recreational and professional gamblers.”
The Democrat representative Dina Titus of Nevada said the provision penalised responsible gamblers and harmed districts that depend on the casino economy. She raised concerns that players could turn to unlicensed operators and said she would seek a “legislative fix” for the provision.
“This is just another attack on gaming and tourism and on districts like mine that rely on these industries,” she said in a statement to the Las Vegas Review-Journal. “This also punishes people who are trying to do the right thing by reporting gambling on their taxes, pushing them towards offshore outlets and the predictions market, which unlike legitimate gambling sources, do not invest in bricks and mortar, pay state taxes, hire union labor, or contribute to problem gaming efforts.”
Russell Fox, a Nevada-based accountant specialising in gambling, told The Washington Post. “They thought: ‘We’ll bury this somewhere in the bill. No one will see it, and now we’ve got $1bn of income to offset $1bn of tax cuts’. This is bad long-term for the casino industry. It’s bad for gamblers. It’s actually bad for the IRS, too. We need a less-complex tax system.”
Some suggest that the tax change could have an impact on casino loyalty programmes like MGM Rewards and Caesars Rewards. These keep a record of al gambling transactions, which are tied to awards. But the prospect of a tax liability could mean that players no longer want their wagers and winnings recorded. That could lead to a decline in casino footfall as well as fewer hotel bookings and lower attendance at events.
