Latest news with #FAIRBETAct
Miami Herald
7 days ago
- 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
CNBC
09-07-2025
- Business
- CNBC
Jim Cramer is bullish on sports betting despite new tax measure in Trump's megabill. Here's why
CNBC's Jim Cramer on Wednesday unpacked a tax measure in President Donald Trump's megabill that could impact the sports betting industry. He said he's not too worried it will hurt business for big players DraftKings and FanDuel parent Flutter. "Ultimately, I think this is something we need to watch, but it doesn't change my bullish attitude toward DraftKings and Flutter," he said. "The thesis here is very simple: these two companies have emerged as an effective duopoly in online sports betting." At present, gamblers can deduct the entirety of their losses from their winnings so that they are only paying taxes on net winnings. The new tax provision changes this system so that gamblers can only deduct 90% of their losses from their winnings. For example, under the current law, if someone wins $1,000 but also loses $1,000, they do not have to pay any taxes. But under the new bill, they would only be able to deduct $900 and would have to pay taxes on $100 of winnings. Cramer said this rule is likely problematic for professional gamblers who deal with millions in winnings and losses. It could also discourage recreational gamblers from betting, he continued, especially those who tend to win big or those who are worried they'll be taxed if they break even or lose slightly. However, he suggested that the law may not actually have a huge effect on DraftKings and Flutter, in part because the companies aren't trying to court customers who win frequently. Most gamblers on these platforms lose money, Cramer said, and those with substantial losses won't be as impacted by the changes. He also said there's a good chance the provision will be reversed, pointing out that lawmakers in Las Vegas introduced a bill on Monday that would rollback the tax changes. Cramer also listed off reasons he thinks DraftKings and Flutter will perform well regardless of the new tax, saying there's "built-in growth to these stories," as states gradually roll out legal sports betting. States like California, Texas and Florida are huge opportunities for the gambling giants, he said. Cramer added that the industry in general has become less competitive, so DraftKings and Flutter no longer need major incentives to draw in customers, which makes them more profitable. "The gambling tax change is clearly not ideal, but there's a very good chance it won't have much impact on either of these companies, and it could even help them," he said. "DraftKings applauds Congresswoman Dina Titus and Congressman Ro Khanna for introducing the FAIR BET Act," a spokesperson for DraftKings told CNBC, referring to the bill aiming to restore the old tax law. "We are committed to working with federal lawmakers and the administration to restore equitable tax treatment for our customers." Flutter did not respond to request for comment. Click here to download Jim Cramer's Guide to Investing at no cost to help you build long-term wealth and invest
New York Post
09-07-2025
- Business
- New York Post
The One Big Beautiful Bill burns sports bettors — and how Senator Dina Titus aims to fix it
Gambling content 21+. The New York Post may receive an affiliate commission if you sign up through our links. Read our editorial standards for more information. The One Big Beautiful Bill has caught the eyes of gamblers across the country — and not in a good way. Section 70114 limits gambling deductions in taxes to 90 percent of losses, down from the current mark of 100 percent. If a bettor places $200,000 in wagers and breaks even ($100,000 in both losses and profit), they could only deduct $90,000 of their losses on their taxes, leaving them liable for $10,000 of phantom income. Nevada Senator Dina Titus is presenting the FAIR BET Act, an amendment to the bill that would address the issue and reinstate the ability to deduct 100 percent of losses from their betting record. 'It is a very simple amendment that changes it from 90% to 100%,' Titus told The Post in a phone interview on the proposed changes. The root of this notable change from has been the subject of much debate. One pro-bettor speculated The Post that the American Gaming Association (AGA) lobbied for this change to be included in the 940-page bill, but Titus threw cold water on that idea. 'It was an amendment that came from U.S. Senator Mike Crapo's office and the Finance Committee and they estimate it will generate a billion over the next 10 years, but I think that's high,' Titus said. 'People will stop reporting income. People will go offshore or use prediction markets and other unregulated markets.' 'When they continued the [President Donald] Trump tax cuts, they needed to offset that with revenue. Looking for different pots of revenue, so there was this tax. They see it raising a billion over 10 years.' Maxx Crosby of the Las Vegas Raiders. Getty Images Titus adds that the AGA is now supporting her bill, and she is looking for bipartisan support for what she calls an 'easy-fix' amendment. 'I don't believe that the AGA would lobby for this to kill off sharp [professional] bettors, and now they are going to support my bill,' Titus added. 'If they did lobby for it, they kept it extremely quiet. I don't think it was anti-gaming people; it was people looking for money. Gaming is an easy target like cigarettes and alcohol.' Big bettors in Vegas were furious over the gambling proivison aded to the One Big Beautiful Bill. Getty Images Get the lowdown on the Best USA Sports Betting Sites and Apps Sportsbooks have not yet considered this a significant issue in the betting world, as the cost is not imposed on them but rather it is levied on the bettor when they file their taxes. But bettors, specifically the ones wagered significant amounts of money in Las Vegas, were furious at this provision being thrown into the One Big Beautiful Billnow that they're facing the prospect of being taxed on 10 percent of phantom revenue. Why Trust New York Post Betting Erich Richter is a brazilian jiu-jitsu blue belt but he has a black belt in MMA betting. During the football season he's showcased massive profits at The Post in the player prop market the last two seasons. While constantly betting long shots, his return on investment is 30.15 percent since 2022.
Yahoo
09-07-2025
- Business
- Yahoo
NTRA Announces Support For FAIR BET Act
NTRA Announces Support For FAIR BET Act originally appeared on Paulick Report. The National Thoroughbred Racing Association (NTRA) announced its support for the bipartisan Fair Accounting for Income Realized from Betting Earnings Taxation (FAIR BET) Act on July 8. The FAIR BET Act, introduced by Representative Dina Titus (D-NV), seeks to restore the 100% deduction for gambling losses. The One Big Beautiful Bill Act, just recently signed into law, amended the deduction so that gamblers could only deduct 90% of their losses, instead of 100%. The legislation is co-sponsored by Reps. Troy Nehls (R-TX), Ro Khanna (D-CA), Jeff Van Drew (R-NJ), Steven Horsford (D-NV), and Mark Amodei (R-NV), as of Tuesday, July 8. 'The NTRA commends Congresswoman Titus for introducing the FAIR BET Act, which will restore the 100% tax deduction for gaming losses,' said NTRA President and CEO Tom Rooney.'There is no Thoroughbred racing without horseplayers. The changes to the tax deduction are detrimental to them and must be fixed. We're glad that swift bipartisan action is being taken. Along with Congresswoman Titus, the NTRA will continue to work alongside the Trump administration and leaders in the House and Senate to restore the tax deduction.'The Congresswoman has led the charge on rectifying this change to the tax code, which is set to take effect next year. 'My FAIR BET Act would rightfully restore the full deduction for losses so gamblers don't pay taxes on money they haven't won,' Congresswoman Titus 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.''While I proudly voted for the One Big Beautiful Bill Act, which prevents the largest tax hike in American history, the Senate's version contained a provision that I strongly disagree with,' said Congressman Nehls. 'Prior to the passage of the OBBBA, the tax code contained a 100% deduction for gambling losses and expenses up to the amount of the individual's winnings. This deduction was not changed in the House-passed version of the bill. The Senate, unfortunately, included a provision in their version of the legislation that reduced the allowable deduction to 90%, creating an overly punitive tax on gambling. This provision is unfair, which is exactly why I am a cosponsor of Rep. Dina Titus' FAIR BET Act.'Rep. Titus's bill can be found here. This story was originally reported by Paulick Report on Jul 8, 2025, where it first appeared.
Newsweek
08-07-2025
- Business
- Newsweek
Republican Backs Push to Repeal Part of Trump Bill Days After Voting For It
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Representative Troy Nehls, a Texas Republican, told Newsweek why he is cosponsoring a bill to repeal a measure included in President Donald Trump's One Big Beautiful Bill Act (OBBBA). "While I proudly voted for the One Big Beautiful Bill Act, which prevents the largest tax hike in American history, the Senate's version contained a provision that I strongly disagree with," Nehls told Newsweek in a statement. Nehls is the first Republican to cosponsor the FAIR BET Act, introduced by Representative Dina Titus, a Nevada Democrat. The bill aims to reverse a measure added by Senate Republicans that would reduce the amount of losses gamblers can deduct from their taxes from 100 percent to 90 percent. In simple terms, this means that if a gambler loses $10,000 during a trip to Las Vegas but wins back $10,000 on a trip later in the year, they would still have to pay taxes on $1,000 in losses. He continued, "Prior to the passage of the OBBBA, the tax code contained a 100% deduction for gambling losses and expenses up to the amount of the individual's winnings. This deduction was not changed in the House-passed version of the bill. The Senate, unfortunately, included a provision in their version of the legislation that reduced the allowable deduction to 90%, creating an overly punitive tax on gambling. This provision is unfair, which is exactly why I am a cosponsor of Rep. Dina Titus' FAIR BET Act." Why It Matters Nehls' support for the FAIR BET Act highlights how some Republicans voted for the bill despite not agreeing with every single measure in the reconciliation package. It's not uncommon for lawmakers often vote in support of large bills even if they view the legislation as imperfect, as they may support other parts of the bill. Critics say the measure included in Trump's would harm the gambling industry, result in players reporting taxable income even if they have net losses and potentially undermine tax compliance. What To Know Titus, whose district includes parts of Las Vegas, introduced the bill on Monday. It would apply to both professional and amateur gamblers. The tax deduction measure was notably added by the Senate as it made significant changes to the bill from the original version passed by the House of Representatives. The Nevada Democrat wrote in a statement that the FAIR BET Act "would rightfully restore the full deduction for losses so gamblers don't pay taxes on money they haven't won." A stock image shows slot machines in Dallas, Texas, on February 27, 2014. A stock image shows slot machines in Dallas, Texas, on February 27, 2014. skodonnell /iStock via Getty Images "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," Titus wrote. Representative Ro Khanna, a California Democrat, is also co-sponsoring the bill. "The Republican budget would kneecap sports and gambling by making Americans pay taxes on gambling losses. This is deeply unfair. I'm proud to introduce the FAIR BET Act with Rep. Titus to restore the 100% tax deduction for gaming losses," Khanna told Newsweek in a statement. Nehls explained his vote for the One Big Beautiful Bill Act in a statement released last week, describing it as "promises made, promises kept." "This bill puts the American people first. It prevents the largest tax hike in American history by making President Trump's Tax Cuts permanent, eliminates taxes on tips and overtime, and delivers meaningful tax relief for seniors—all core promises from President Trump's campaign," he said. What People Are Saying Titus wrote in a post to X (formerly Twitter): "The FAIR BET Act now has bipartisan support! Thank you @RepTroyNehls for signing on. I will continue championing this legislation through Congress. Keep the momentum going!" Professional poker player Phil Galfond wrote to X on July 1: "If you win $100k and lose $100k – You'll owe tax on $10k of 'phantom' income. If you win $100k and lose $50k – You actually profited $50k, but you'll owe tax on $55k. If you win $100k and lose $150k – No tax owed (your deduction is capped at $100k, which is more than 90% of $150k ($135k))." The American Gaming Association, which supported Trump's bill, also backed Titus' bill in a statement reported by ESPN: "The American Gaming Association applauds Congresswoman Titus for introducing the FAIR BET Act. 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." What Happens Next If the FAIR BET Act does not pass, the new tax deduction provision will go into effect in 2026.
