President Donald Trump’s “One Big Beautiful Bill” (OBBB) Act included awful provisions that will negatively affect gamblers.
However, this is one bright spot for the gambling world. The tax and spending initiative increased the tax reporting thresholds on gambling winnings, depending on who you ask.
Casino employees must collect personal information from a patron if they get a slot machine or table game payout of more than $1,200. The new bill increases the threshold to $2,000.
Prior to the increase, the number had not changed since 1977. Gamblers most commonly associate the rule with slot machine and video poker payouts.
Additionally, it mostly affects brick-and-mortar casinos. Online casinos will have a complete record of bettors wins and losses.
The bill also spells out that the amount will increase annually based on inflation. A representative told Casino.org that the section “applies to any reporting under section 6041 of the Internal Revenue Code. The slot threshold is tied to that section of the code.”
Disagreement on Impact to Gamblers
The increase comes up short of the Shifting Limits on Thresholds (SLOTS) Act proposed earlier this year. That bill would increase the reporting threshold to $5,000.
Not all tax professionals are in agreement that the OBBB raises the reporting threshold for most winning players. Russ Fox, of Clayston Financial and Tax, noted in a blog post that the amount won to receive a W-2G form remains at $1,200 under current tax law and that the change applies only to 1099-MISC filers.
However, the IRS could read the law differently.
“It is possible the IRS will interpret this law change to mean the W-2G threshold is increased to $2,000. That would be welcome by almost everyone but I would not hold my breath waiting for that interpretation,” Fox said.
The bill has brought some consternation among poker players and gamblers, who would only be able to write off 90% of their losses. Several prominent poker players said it would severely harm the gambling industry, especially live and online poker pros since they would be paying taxes on money they didn’t win.
Nevada Rep. Dina Titus’ FAIR BET Act (Fair Accounting for Income Realized from Betting Earnings Taxation Act) to nullify that provision and received some bipartisan support. But some Senate Republicans oppose the proposal. the proposal has seen some opposition in the Senate.
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