Latest news with #AmericanGamingAssociation
Bloomberg
5 days ago
- Business
- Bloomberg
Republicans' Surprise Gambling Tax Rolls the Dice on Young Men
Politicians don't typically spend a lot of time talking about the needs of professional gamblers. But they are now — and their fight over a little-known provision in the One Big Beautiful Bill Act that will hit high rollers with a new tax penalty is worth watching because it's exposing the many tensions within MAGA. There are the socially conservative Republicans who don't like gambling. The libertarian Republicans who don't care. The Republicans who say they are for the working class, including casino workers. The business-friendly Republicans who see an opportunity in an industry that made $72 billion in revenue last year, according to the American Gaming Association. And then there's President Donald Trump, a former casino owner who pals around with current casino owners who shower him with campaign donations.
Yahoo
6 days ago
- Business
- Yahoo
Trump's 'big, beautiful bill' is bringing changes to how Tennessee gamblers earn money in 2026
President Donald Trump's new spending bill could cause gamblers to lose out even more. An obscure provision to reduce the tax deduction for gambling losses, which Congress recently approved in President Donald Trump's top priority second-term legislative package, is at the center of this change. The provision is projected to raise $1 billion for the government over the next decade. Starting in 2026, the taxation of gambling will be changed and Tennessee, where online sports betting is roughly a half-billion-dollar industry, could be affected by the changes. Here's what to know about the upcoming changes. What does the tax provision for gambling do? After 2025 gamblers will no longer be able to deduct 100% of their losses from their winnings on their income taxes. Starting Jan. 1, 2026, under the new law, the deduction for losses goes down to 90%. In practice, under the previous rule, if someone won $100,000 but also lost $100,000, they could deduct the entire $100,000 in losses and owe nothing in taxes. However, under the new rule, they can only deduct $90,000 and would still need to pay taxes on the remaining $10,000, even after losing all their winnings. While the provision begins on Jan. 1, 2026, we will not see the effects of this change until the 2026 tax season begins in January 2027. Although a 10% decrease may not sound like much, experts who study the industry say it would cut severely into a gambler's profits. In some cases, a professional gambler could owe taxes despite losing more than they win in a year. Phil Galfond, a professional poker player, said on social media: 'What this means in plain English" is that a gambler who wins $100,000 and loses $100,000 in one year will still owe tax on $10,000 of 'phantom' income because only $90,000 of the losses will be deductible. As the numbers ramp up, the implications become more dire for high rollers. A professional who wins $3 million and loses $2.8 million in one year would have earned $200,000 but will be taxed on $480,000. How many people does the gambling provision affect? The change in tax law comes amid an explosion in online betting, through the widespread legalization of online sports wagering. U.S. commercial gaming revenue reached an annual record of nearly $72 billion in 2024, according to the American Gaming Association. It was the fourth straight year of record revenue, up from $66.5 billion in 2023. The overall revenue reached nearly $50 billion from traditional casinos, with approximately $14 billion coming from sports betting and $8.4 billion generated through online gaming. Notably, online gaming saw a significant increase, rising from around $2.4 billion in the previous year. Is gambling legal in Tennessee? The only legal form of online gambling in Tennessee is online sports betting, and it has been legal since 2020. Other forms of gambling that are allowed in the state include the state lottery, horse race waging, charitable gambling and futures or commodities trading. For those in Tennessee wanting to bet on sports, they must be at least 21 years of age and register with approved, licensed sportsbook operators who verify locations and identity. Tennessee is among the states that allow online sports betting but not online casino games, such as online slots, table games, or poker. Some of these states enable casinos, but Tennessee does not. Arizona, Colorado, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Mississippi, Missouri, Montana, Nevada, New Hampshire, New York, North Carolina, Ohio, Oregon, Tennessee, Vermont, Virginia, and Wyoming all allow online sports betting but not casino games. How much money does gambling make in Tennessee? In 2025, sports gambling is slightly down compared to the end of 2024, but it is up compared to the same time in 2024. January had a gross handle of $543,646,737. This is a 16.71% year-over-year increase from January 2024. February had a gross handle of $413,505,815. This is a 9.33% year-over-year increase from February 2024. March had a gross handle of $548,598,949. This is a 16.23% year-over-year increase from March 2024. April had a gross handle of $463,591,024. This is a 21.71% year-over-year increase from April 2024. May had a gross handle of $437,543,866. This is a 15.40% year-over-year increase from May 2024. June had a gross handle of $350,943,907. This is a 2.56% year-over-year increase from June 2024. Some Democratic lawmakers seek to erase provision from GOP bill Industry lobbyists and Nevada lawmakers are trying to erase the two paragraphs from the nearly 900-page bill. But those prospects are uncertain because Republicans narrowly approved the carefully calibrated bill in the House and Senate, and the president has since signed it into law. Reps. Dina Titus, D-Nevada, and Ro Khanna, D-California, introduced legislation July 7 – three days after Trump signed the bill into law – to remove the provision. Jordan Green covers trending news for The Commercial Appeal. She can be reached at This article originally appeared on Memphis Commercial Appeal: How Trump bill could impact sports betting winnings in Tennessee
Miami Herald
13-07-2025
- Business
- Miami Herald
Break even at the casino? You may still owe taxes.
(DealBook) It's President Donald Trump's casino — and the house always wins. That is the crux of gamblers' frustration after they read Trump's landmark policy legislation, which includes an under-the-radar provision that amends how gambling income is taxed. Previously, gamblers were taxed like any other profession: If a poker player or sports bettor broke even, he or she would report zero taxable income. But starting next year, only 90% of losses will be deductible. When gamblers break even, or incur a net loss, they will still owe taxes — effectively a 10% penalty on gambling winnings. The change is expected to generate an additional $1.1 billion in tax revenue through 2034. 'It makes it impossible to gamble for a living,' said Phil Galfond, a professional poker player. Almost immediately after the law's contents became public, professional gamblers, gaming coalitions, lawmakers and members of the casino industry denounced the betting-related change, vowing to roll back the rule before it goes into effect. The backlash has set up a battle over earnings from the hundreds of billions of dollars that Americans legally wager each year through casinos, racetracks and sports betting apps. A new congressional bill aims to overturn the rule. Monday, Rep. Dina Titus, D-Nev., who is the cochair of the Congressional Gaming Caucus, introduced the Fair Accounting for Income Realized From Betting Earnings Taxation Act, or FAIR BET Act, which would restore the 100% deduction for gambling losses. 'It's taxing people on money that they don't have,' Titus said, 'and unfairly targeting one industry that should be treated like any other.' Cosponsored by a fellow Democrat, Rep. Ro Khanna, D-Calif., the legislation immediately received bipartisan support, with Rep. Troy Nehls, R-Texas, signing on. Poker players fear accounting nightmares. Under the new rules, professional gamblers will not only pay more taxes and take home less net income but see these effects compound as they win and lose more money. For example: If a player wins $100,000 and loses $100,000 in a given year — breaking even, with zero net income — the player would owe taxes on $10,000 in 'earnings,' essentially phantom income. But if a player wins $1 million and loses $1 million — again, breaking even -- the player would owe taxes on $100,000. For professional poker players who regularly have winning and losing streaks well into the millions of dollars, this type of penalty for high-stakes play can spell ruin. Similarly, if a player claims a net loss at the end of the year, he or she will still owe taxes. For example: If a player wins $300,000 in the first half of the year but then goes on a losing streak and counts $315,000 in losses — ending the year with a net loss of $15,000 — the player will owe taxes on $16,500 because the deduction would be capped at 90% of the losses, or $283,500. Lobbyists for the gambling industry are in an awkward position. In May, the American Gaming Association, the lobbying arm of the casino and gambling industry, defended the current way of taxing gambling income in a letter to the House Committee on Ways and Means. 'This longstanding itemized deduction for gaming losses is not a subsidy for gaming customers,' the association wrote. 'It is a tool for properly measuring income.' Despite these tax-related preferences, the group supported Trump's bill, saying in a July 3 statement that the act significantly enhances the gambling industry's 'ability to sustain quality jobs and deliver economic benefits.' Now the American Gaming Association is backing the FAIR BET Act, which criticizes the bill it just endorsed. The tax-code change could have a profound effect. While the industry benefits from some of Trump's new economic policies, it may see a reduction in the amount of money that professional and amateur gamblers play with at commercial outlets, such as casinos, which in 2024 posted a record $72 billion in revenue. 'It will be tens of billions of dollars,' said Derek Stevens, owner and CEO of Circa Sports, a sports betting chain and app. 'It's definitely going to impact jobs, hotel occupancy, visitation and other elements of casino games,' he added. Some industry executives also believe the changes will push professional gamblers away from aboveground commercial establishments and into unregulated and illegal betting markets where they can avoid the financial penalty associated with reporting their income. 'It doesn't take all that much, frankly, to have $20 million a year in winnings and to have $19.8 million in losses,' Stevens said. 'All of that liquidity is going to be moving offshore, or moving to illegal books. I just don't think people fully digest the impact.' This article originally appeared in The New York Times. Copyright 2025
Axios
10-07-2025
- Business
- Axios
Gamblers full of "rage" over Trump's "big, beautiful bill" tax changes
President Trump's " big, beautiful bill" legislation hasn't hit the jackpot with gamblers and the wider gaming industry. The big picture: Gamblers are angry over a provision that could see bettors lose money even when they come out ahead during tax time — something that lawmakers are already making moves to repeal. The tax rule changes came as sports gambling has become massively popular, replacing the stock market in many states for investors. Revenue from commercial gaming in the U.S. hit over $70 billion in 2024, according to the American Gaming Association. Gambling tax losses in 'big, beautiful bill' Trump's signature legislation includes a provision that allows gamblers to deduct from their winnings equal to 90% of their losses for a tax year. Before, gamblers could deduct all of their losses from their declared income. Case in point: A hypothetical gambler who wins $100,000 but looses $100,000 would have to pay taxes on $10,000 of income. "There could be scenarios where folks have a tax liability that matches or exceeds the amount that they earn," Garrett Watson, director of policy analysis at the Tax Foundation, told Axios earlier this month. The new rule begins in 2026, and could raise $1 billion for the government, according to the Congressional Budget Office. Gamblers upset over gambling tax loss rule Before the bill passed, there was growing angst over the provision from gamblers. Pro poker player Phil Galfond said on X the provision "would end professional gambling in the US and hurt casual gamblers," with pros losing millions based on their wins and losses. Everyday gamblers are still concerned. Many X users have been rolling their eyes at the new tax rule, and some — including those who bet on apps like FanDuel and DraftKings — questioned their gambling habits in the future. "It is something that's driving rage," Brett Abarbanel, executive director of the International Gaming Institute at UNLV told Axios. "There's a lot of frustration." Alexander Korsager, chief gaming officer at agreed: "The emotional tone we're seeing online shows just how real the concern is." Much of the frustration, Abarbanel said, is because the law changes the tax structure for millions of people. Gamblers who place bets on any given Sunday may now take their decision more seriously because there are tax implications, Abarbanel said. What we're watching: This is likely to remain a sore spot for taxpayers through the 2026 midterms — unless something is done about it by lawmakers. "We may even see renewed outrage when people realize what that impact is when they start filing their own taxes," Abarbanel said. Reality check: An American Gaming Association spokesperson said the tax provision is more likely to impact taxpayers who itemize during tax season — like professionals — over those who take the standard deduction. Gambling provision and the FAIR Bet Act Members of Congress have already spun the wheel of walking back the gambling tax provision. Rep Dina Titus (D-Nev.) introduced the the FAIR Bet Act on Monday, which would make gambling deduction 100% again. Reps. Ro Khanna (D-Calif.) and Troy Nehls (R-Texas) are also on board with the new legislation. "This is an attack on freedom, fun, and sports," Khanna wrote on X. The gaming industry has widely shared support for the FAIR Bet Act. A representative for Draft Kings said in a statement that the company is "committed to working with federal lawmakers and the Administration to restore equitable tax treatment for our customers." An American Gaming Association spokesperson said the industry trade group will work with Congress "to restore the long-standing tax treatment of gaming losses." The other side: Republicans on the Senate Finance Committee told HuffPost that the gambling tax went largely unnoticed during "big, beautiful bill" negotiations. (Though there were reportedly negotiations to fix the tax deduction cuts that were denied.)
The Herald Scotland
10-07-2025
- Business
- The Herald Scotland
Gamblers are furious over obscure provision in Trump's new tax bill
What does the tax provision for gambling do? The new law gives the phrase "cutting losses" a whole new meaning. Gamblers currently deduct 100% of their losses from their winnings off their income taxes. But starting Jan. 1, 2026, under the new law, the deduction for losses goes down to 90%. While that 10% decrease may not sound like much, experts who study the industry say it would cut severely into a gambler's profits. In some cases, a professional gambler could owe taxes despite losing more than winning in a year. More: As sports betting skyrockets, more Americans search for addiction help, study finds "Professional and high-stakes poker players, sports bettors and handicappers are about to be taxed out of business," said Nelson Rose, a law professor emeritus at Whittier Law School. "Either that or they will move their action overseas to foreign jurisdictions that don't report gambling winnings to the IRS." Phil Galfond, a professional poker player, said on social media "what this means in plain English" is that a gambler who wins $100,000 and loses $100,000 in one year will still owe tax on $10,000 of "phantom" income because only $90,000 of the losses will be deductible. As the numbers ramp up, the implications become more dire for high rollers. A professional who wins $3 million and loses $2.8 million in one year would have earned $200,000 but will be taxed on $480,000. "You could pay more in tax than you won," Galfond said on social media July 1. How many people does the gambling provision affect? The change in tax law comes amid an explosion in online betting, through the widespread legalization of online sports wagering. U.S. commercial gaming revenue reached an annual record of nearly $72 billion in 2024, according to the American Gaming Association. It was the fourth straight year of record revenue, up from $66.5 billion in 2023. The total included nearly $50 billion in revenue at traditional casinos, nearly $14 billion through sports betting and $8.4 billion from online gaming. Online gaming rose from about $2.4 billion the previous year. Gambling experts say the change in tax law could hurt professional gamblers who deal in razor-thin profit margins but probably not casual bettors. In 11 states were sports gambling was legalized, people increased their betting from 99 cents to $4.63 per month, according to an academic study by Wayne Taylor, Daniel McCarthy and Kenneth Wilbur. The study found "the vast majority" - 99% of players during a five-year period - deposited less than $20,500 in their accounts. "For the casual bettor, the direct impact appears negligible," Taylor, an assistant professor of marketing at Southern Methodist University, told USA TODAY. "This volume is unlikely to trigger the need for itemized deductions." More: Big Beautiful Bill 101: What you need to know about the new law The chips quickly add up for heavier hitters. The Congressional Budget Office estimated the gambling tax provision would generate more than $1 billion over 10 years for the federal government. Taylor said professional gamblers facing higher taxes "could make professional gambling in the U.S. entirely unprofitable." "It could mean paying more in taxes than they actually earn," Taylor said. New tax law could send gamblers offshore or to unregulated outlets: experts A risk to the industry and the governments that regulate it is that gamblers will stop reporting their income or move to gambling sites in other countries, according to industry experts. Rose said a double-whammy for gamblers is that casinos, sports books and card rooms report big winnings to the IRS through W-2G or 1099 forms, but gamblers might not track their losses as diligently. "The real risk is pushing high-volume players offshore," Taylor said. Another potential beneficiary is the predictions market, which isn't regulated like gambling. Companies such as host "trades" about predictions like who might be elected president or whether the head of the Federal Reserve will be replaced. One of the president's adult sons, Donald Trump Jr., said he became a strategic adviser to Kalshi in January after trading on the prediction that his father would win the 2024 election while "biased outlets called the race a coin toss." "I'm excited to be a part of what they're building," Trump Jr. said on social media Jan. 13. Some Democratic lawmakers seek to erase provision from GOP bill Industry lobbyists and Nevada lawmakers are trying to erase the two paragraphs from the nearly 900-page bill. But those prospects are uncertain because Republicans narrowly approved the carefully calibrated bill in the House and Senate, and the president has since signed it into law. "We look forward to President Trump's expected signing and will work closely with Congress in the coming months to address the changes to wagering deduction losses and further modernize the tax code," the American Gaming Association said in a statement July 3. Reps. Dina Titus, D-Nevada, and Ro Khanna, D-California, introduced legislation July 7 - three days after Trump signed the bill into law - to remove the provision. "This common-sense legislation will bring fairness back to gaming taxation, making sure that gamblers can fully deduct losses when they report their winnings," Titus said on social media July 3. "We should be encouraging players to properly report their winnings and wager using legal operators."
