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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."
The Herald Scotland
06-07-2025
- Automotive
- The Herald Scotland
Trump's 'Big Beautiful Bill' offers car tax credits to add to Biden's
? 2022 Inflation Reduction Act: The Biden-era incentive gives you up to a $7,500 tax credit for new, plug-in EVs or fuel-cell electric vehicles. Trump's massive tax and spending policy bill will end this credit as early as Sept. 30. ? "Big Beautiful Bill": Trump's new law offers an annual tax credit of up to a $10,000 on the interest of loans for new vehicles as long as they're less than 14,000 pounds and assembled in the United States. It covers purchases made in 2025 through 2028. Big Beautiful Bill 101: What you need to know about the new law How long Biden's and Trump's tax credits for new cars last Unable to view our graphics? Click here to see them. More: What new version of Trump's 'Big, Beautiful Bill' could mean for EV car buyers and automakers How to stack the auto tax credits Here's how combining Biden's and Trump's tax credits over the next four years could save you a hunk of money on an EV: A new EV might not be the best investment To be sure, this strategy might not be the best way to stretch your dollar. But perhaps you're set on purchasing a new EV with the latest gadgets and upgrades. The average price paid for a new EV this year has been $57,734, according to Kelley Blue Book. Even with the $7,500 tax credit, the EV premium over a gas-powered car is about $1,500. The math tips in favor of EVs when you look at the five-year fuel costs: $9,490 for gas-powered vs. $4,295, according to Kelley Blue Book. If you can live without the new-car smell, used EVs' average listing price this year is about $20,000 less than for new models, according to Kelley Blue Book. You can also get a $4,000 tax credit from Biden's legislation for a used EV, but that wouldn't qualify you for the Trump tax credit. Some additional fine print to consider if you use either of these tax credits ? Big Beautiful Bill: The tax credit for auto loans phases out for incomes between $100,000 and $150,000 for an individual and between $200,000 and $250,000 if you file jointly. It's not available for fleet purchases, commercial vehicles or leasing. ? Inflation Reduction Act: To take advantage of the EV credit, you also must buy the car - assembled in North America - for your own use. Your income must to fall below $150,000 for an individual and $300,000 for those filing jointly.
USA Today
05-07-2025
- Automotive
- USA Today
How to save thousands on a car by stacking Trump's tax credits with Biden's
If you've been thinking about buying a new electric vehicle, you have less than three months to bundle tax credits from both Joe Biden's and Donald Trump's administrations. Consider how each president's signature piece of legislation could help you save on a new car: ◾ 2022 Inflation Reduction Act: The Biden-era incentive gives you up to a $7,500 tax credit for new, plug-in EVs or fuel-cell electric vehicles. Trump's massive tax and spending policy bill will end this credit on Sept. 30. ◾ 'Big Beautiful Bill': Trump's new law offers an annual tax credit of up to a $10,000 on the interest of loans for new vehicles as long as they're less than 14,000 pounds and assembled in the United States. It covers purchases made in 2025 through 2028. Big Beautiful Bill 101: What you need to know about the new law How long Biden's and Trump's tax credits for new cars last Unable to view our graphics? Click here to see them. More: What new version of Trump's 'Big, Beautiful Bill' could mean for EV car buyers and automakers How to stack the auto tax credits Here's how combining Biden's and Trump's tax credits over the next four years could save you a hunk of money on an EV: A new EV might not be the best investment To be sure, this strategy might not be the best way to stretch your dollar. But perhaps you're set on purchasing a new EV with the latest gadgets and upgrades. The average price paid for a new EV this year has been $57,734, according to Kelley Blue Book. Even with the $7,500 tax credit, the EV premium over a gas-powered car is about $1,500. The math tips in favor of EVs when you look at the five-year fuel costs: $9,490 for gas-powered vs. $4,295, according to Kelley Blue Book. If you can live without the new-car smell, used EVs' average listing price this year is about $20,000 less than for new models, according to Kelley Blue Book. You can also get a $4,000 tax credit from Biden's legislation for a used EV, but that wouldn't qualify you for the Trump tax credit. Some additional fine print to consider if you use either of these tax credits ◾ Big Beautiful Bill: The tax credit for auto loans phases out for incomes between $100,000 and $150,000 for an individual and between $200,000 and $250,000 if you file jointly. It's not available for fleet purchases, commercial vehicles or leasing. ◾ Inflation Reduction Act: To take advantage of the EV credit, you also must buy the car − assembled in North America − for your own use. Your income must to fall below $150,000 for an individual and $300,000 for those filing jointly.
The Herald Scotland
02-07-2025
- Automotive
- The Herald Scotland
How the Musk-Trump feud played out in media: timeline
More: Big Beautiful Bill 101: What you need to know about Trump's tax bill Shortly after, he made multiple disparaging posts on his platform X, starting by calling the bill a "disgusting abomination." His posts prompted Trump to say he was "very disappointed" with Musk's remarks. As Telsa CEO, Musk's comments may also stem from another portion of the tax bill that would eliminate a $7,500 tax credit for new electric vehicles. Trump suggested as much in his July 1 response. Timeline: How the Elon Musk-Trump dispute played out Here's a look at how their relationship has fluctuated since Musk first endorsed Trump for president: Unable to view our graphic? Click here to see it. The two have had a somewhat tumultuous relationship since 2016 when Musk publicly spoke against Trump's initial presidential campaign. Trump shared both insults and compliments about Musk between then and his third presidential campaign, in which they became closely aligned. Musk spent over $250 million on Trump's 2024 presidential campaign and Trump invited Musk to both his election night party and inauguration speech. Trump then created DOGE and hired Musk as a "special government employee" to lead the department alongside Vivek Ramaswamy. Now, Trump has gone as far to say he's looking into deporting Musk from the United States, and Musk continues to vocalize disdain for the bill on his X account, where he's promoting his concept for a new political party "The America Party" to his 221.5 million followers. CONTRIBUTING Kathryn Palmer, Joey Garrison, Sudiksha Kochi
The Herald Scotland
02-07-2025
- Business
- The Herald Scotland
Trump's big tax bill: Who are the winners and losers?
The U.S. Senate narrowly passed its bill with 50 votes on July 1--with Vice President JD Vance casting the deciding vote--after intense Republican negotiations for changes. It now heads back to the House to reconcile the differences with on another tight deadline so it can be on Trump's desk for signature into law by July 4. Big Beautiful Bill 101: What you need to know about Trump's tax bill What's in the 'Big Beautiful Bill' The plan would make permanent the 2017 tax cuts from Trump's first term. It would reduce some taxes, but it would raise others, and change spending amounts. USA TODAY looked for winners and losers if the bill becomes law. Here are examples of what we found. High-income households would benefit most Unable to view our graphics? Click here to see them. Top 5 winners High-income earners Can't see our graphics? Click here to view them. The bill "would cut taxes on average by about $2,800 in 2026," according to an analysis by the nonpartisan Tax Policy Center. More than two-thirds of the total cuts would go to those with annual incomes of about $217,000 or more, the center said. Those with incomes of $1.1 million or more would get nearly a fourth of the cuts. Families with children The House bill would increase the child tax credit by $500 to $2,500 through 2028. It would drop to $2,000 after that. But an estimated 4.5 million children become ineligible under a new requirement that both parents have a Social Security number, USA TODAY reported. The Senate bill permanently increases the tax credit to $2,200 and adjusts for inflation. Children younger than 8 would be given $1,000 each for their parents to open "money accounts for growth and investment," also known as a "MAGA" savings account. What the Trump administration means for your wallet: Sign up for USA TODAY's Daily Money newsletter. Car buyers From 2025 through 2028, the bills would allow people to deduct up to $10,000 annually in car loan interest payments if they buy an American-made vehicle. The deduction declines as your income rises past $100,000, or $200,000 for joint filers. Those with overtime pay Overtime wages, which are treated like regular wages with federal and state income taxes, Social Security and Medicare withholding, would not be taxed in the House bill. Federal revenue could be reduced by $680 billion to $866 billion from 2025 to 2034 if overtime pay wasn't taxed, according to a study by the Tax Foundation and Yale's Budget Lab in April. In the Senate bill, the first $12,500 of extra overtime pay would be tax-deductible through 2028 with $150,000 income limit. Waiters and workers who get tips All tips would not be taxed through 2028 in the House version. Tips are historically underreported, according to the IRS. Unreported tip income from noncompliant businesses could be as high as $23 billion, according to a report from the Treasury Inspector General for Tax Administration in 2018. In the Senate bill, the first $25,000 of tips are tax-deductible through 2028 with a $150,000 income limit. Top 5 losers Those making less than $50,000 Americans making about $17,000 to $51,000 would lose about $700. Those with an income of less than $17,000 would lose more than $1,000 on average. The losses are mainly a result of cuts in assistance programs including Medicaid, health insurance marketplaces, the Supplemental Nutritional Assistance Program and student loans. SNAP/Medicaid recipients The bill's changes to Medicaid could result in as many as 7.6 million Americans losing health insurance over the next 10 years, according to initial estimates by the CBO. About $698 billion would be cut from the program in the House version. An estimated $1 trillion would be cut in the Senate version. The measure would cut $267 billion in federal spending for Supplemental Nutrition Assistance Program, known as SNAP or food stamps, CBO said of the House version. It would also impose work requirements on those age 55 to 64 who benefit from the program, which provides food assistance to about 42 million Americans. People with student loan debt Student loan relief regulations enacted by President Joe Biden's administration would be repealed in the House version, and the number of repayment plans for federally held loans would shrink to just two programs. The bill would also impose significant caps on loans for parents and undergraduate students, while eliminating a lending program for future graduate students. Higher federal deficit The bill's provisions would increase the federal deficit by $3.8 trillion from 2026 to 2034, according to the CBO, which cited tax changes, including the extension of the 2017 tax act and its revenue and outlays for refundable credits. Undocumented people The bill would increase fees for legal immigration. It would impose a $1,000 fee on requests for asylum and require $500 payments for work authorizations every six months, USA TODAY reported. It would charge immigrants hundreds of dollars if they appeal court decisions, among other fees. The bill would also discourage states from using their own money to provide Medicaid coverage to undocumented children. CONTRIBUTING Riley Beggins, Bailey Schulz, Lauren Villagran Zachary Schermele, Chris Quintana and Dan Morrison SOURCE USA TODAY Network reporting and research; Reuters; Tax Policy Center; Penn Wharton at the University of Pennsylvania; Center on Budget and Policy Priorities; Congressional Budget Office
