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Dina Titus urges House of Representatives to act fast, reverse federal gambling tax change for 2026
Lawmakers are hoping to prevent a new gambling tax deduction policy from taking effect Jan. 1, which President Donald Trump indicated he would consider eliminating
With only a few weeks left in the year, Nevada Rep. Dina Titus is urging other House representatives to expedite consideration on a proposed bill that would reverse a gambling tax deduction change that will go into effect Jan. 1, 2026. What many describe as an inadvertent element included in the One Big Beautiful Bill Act, the new law will set a 90% limit on deductibility of gambling losses with online casinos and sportsbooks, down from the 100% that has been in place for over 60 years.
Starting Jan. 1, online casino users can only deduct 90% of gambling losses
As it currently stands, once the new year hits, one aspect of the One Big Beautiful Bill Act that affects users of legal casino apps is a lower standard for deducting gambling losses against winnings. For over six decades, gamblers have been able to deduct 100% of gambling losses from winnings during tax season. On Jan. 1, that new number will lower to 90%.
To put that into perspective, someone playing casino games online who wins $10,000 but also loses $10,000 would be required to pay taxes on $1,000 despite only breaking even, what many opponents of this new deductible standard are calling "phantom income" tax.
Titus drafted the Fair Accounting for Income from Betting Earnings and Taxation (FAIR BET) Act over the summer, which would restore the 100% tax deduction for gambling losses. Now, the Nevada representative is pushing other legislators to quickly take her bill under consideration and reverse the deduction change that is looming. As it stands, the legislature will adjourn on Dec. 19.
Titus voiced her urgency in a letter to Jason Smith, chair of the House Ways & Means Committee, noting that while the change may appear minor, it could have "significant and harmful consequences" as people would, in essence, be paying taxes on money they did not win. As a result, the deduction change "unfairly burdens" gamblers and would inevitably push them to offshore and unregulated markets, which do not offer the same consumer protections as licensed operators in the U.S.
Bills from House, Senate boast bipartisan support to restore 100% deduction rate
In a release announcing the letter to Smith, it was noted that Titus' FAIR BET Act has drawn strong and bipartisan support from nearly two dozen co-sponsors. It has also received backing from the American Gaming Association (AGA) as well as from prominent online casino companies like MGM, DraftKings, FanDuel, Caesars and Wynn.
Not to be outdone, as Circa Resorts & Casino CEO Derek Stevens highlighted on social media, the Senate has presented similar legislation that would restore the 100% deductible rate – it, too, garnering strong bipartisan support.
Stevens said that he – along with MGM CEO Bill Hornbuckle, Caesars CEO Tom Reeg, Wynn CEO Craig Billings and AGA CEO Bill Miller – met with Smith with the goal of eliminating the deductible change. According to Stevens, Smith emphasized that citizens should contact their state representatives and senators to urge them to reverse course.
For his part, President Donald Trump, when asked by reporters about potentially reinstating the 100% deductible rate, left the door open for potential consideration but added that he would "have to think about that" before making a decision.
