A provision in Donald Trump’s recently passed Big Beautiful states that starting next year, only 90% of gambling losses will be eligible for deduction, and a congresswoman from Nevada has countered that with the FAIR BET Act to restore the present 100% deduction.
Gamblers’ Rights
President Trump recently signed the budget reconciliation bill, but there was a section to reduce the standard 100% gambling losses on one’s tax filings to 90% of the losses, which is stipulated in what has become known as Trump’s Big Beautiful Bill. The reason for the decrease was to raise $1.1 billion over eight years. The gambling tax code amendment was included in the budget bill by Idaho’s U.S. Sen. Mike Crapo.
However, U.S. Representative Dina Titus from Nevada’s first district, which includes parts of Las Vegas, decided that it was unfair to bettors everywhere, and she created the Fair Accounting for Income Realized from Betting Earnings Taxation (FAIR BET) Act, which would restore the 100% tax deduction for gambling losses.
“The recently passed budget bill included a provision inserted by Senate Republicans without consent of the House that imposed a tax increase on Americans who gamble by reducing from 100 percent to 90 percent the amount of losses they can deduct from gambling winnings for their income taxes,” Titus said in a release. “My FAIR BET Act would rightfully restore the full deduction for losses so gamblers don’t pay taxes on money they haven’t won.”
Bill Backed by AGA
The American Gaming Association (AGA), the trade group for gambling operators, backed the 10% reduction in the budget bill but also applauded Representative Titus’s FAIR BET Act. It’s unusual for any person or organization to support both sides of an issue, but it appears the AGA is more concerned with backing the right pony in this legislative tussle.
“The American Gaming Association applauds Congresswoman Titus for introducing the FAIR BET Act,” the organization said in a statement. “We are committed to working with Congresswoman Titus, other congressional leaders, and the Trump Administration to restore the long-standing tax treatment of gaming losses.”
Tribal Casinos Sound the Alarm
And even the tribal casinos are frantic about the damage the bill would cause to their land-based casino industry. Indian Gaming Association chairperson Victor Rocha stated, “The entire industry is freaking out. It will have an effect on tribes. There’s pain all the way across. I heard a gambler say, ‘We’ll just go offshore and won’t report it.’”
Titus’s statement also said, “This common-sense legislation will bring fairness back to gaming taxation, making sure that gamblers can fully deduct losses when they report their winnings. It gives everyone — from recreational gamblers to high-stakes gamblers — a fair shake. We should be encouraging players to properly report their winnings and wager using legal operators. The Senate change will only push people to not report their winnings and to use unregulated platforms.”
The real-world example would be someone getting reports showing they had $100,000 in gambling winnings over the course of a year but could justify writing off $100,000 in losses, leaving that gambler to pay zero to the IRS in winnings.
However, using the same scenario but with the new tax code in place, the gambler could only write off $90,000, which would have them on the hook for $10,000 worth of gambling winnings.
The new tax code will be implemented in 2026 if Titus’s FAIR BET Act does not rescind the measure.
