U.S. Rep. Dina Titus, a Nevada Democrat, on Monday introduced a bill that would roll back a change to the amount of losses gamblers could claim on their taxes to the current level, which would undo a provision in the just-signed Congressional budget.
The Fair Accounting for Income Realized from Betting Earnings Taxation Act (FAIR BET Act) was succinct, proposing only to return to 100% the amount of gambling losses gamblers can deduct for tax purposes against their winnings.
A section of the so-called One Big Beautiful Bill Act (OBBBA) rammed through by Republicans to allow for President Donald Trump to sign it on July 4 reduced the amount gamblers could deduct for wagering losses. Current law is 100% of annual winnings. The new law would reduce that figure to 90%, meaning bettors could owe tax on a losing year. This move was widely viewed as devastating to professional bettors who underpin the gambling industry.
The controversial provision appears to have originated with Senate Finance Chair Mike Crapo, a Utah Republican that Politico described as “the leading advocate for using a legislative accounting method known as current policy baseline that would treat the extension of Trump’s 2017 tax cuts as costing nothing.”
Crapo’s office has not responded to InGame inquiries.
Worry: Big gamblers will move to ‘black market’
“The OBBBA’s new provision to limit deductions for wagering losses to 90 percent of annual winnings will unfortunately hurt the gaming operators by potentially pushing players to the black market,” Bill Pascrell III, a lobbyist with Princeton Public Affairs Group, told InGame. “Players could be forced to pay more in taxes than they make in net winnings. I applauded my dear friend Congresswoman Dina Titus for her leadership and for introducing legislation to fix this provision to avoid the harm it would create. Congress must pass this legislation immediately.”
Titus signaled her intentions on social media on Friday, posting on X:
“On Monday I’m introducing the FAIR BET Act, the Fair Accounting for Income Realized from Betting Earnings Taxation Act, to permanently restore the 100% loss deduction from gambling winnings. I welcome all other members to join this common sense fix.”
Circa Resort & Casino owner Derek Stevens had even more suggestions. He responded on X, urging elimination of the federal tax on sports bets and raising the threshold on slots.
Titus and many gambling industry stakeholders fear the law change would push more gamblers to unregulated black markets that don’t report players’ activity to taxing authorities.
Last week on the News Nation cable network, Titus said, “The black market doesn’t pay taxes, isn’t regulated, doesn’t help with problem gaming, so it’s bad for the industry as well as for the player.”
In keeping with the amount of social media discourse about the OBBBA and the gambling industry response, Titus found a co-sponsor for the FAIR Bet Act on Monday in California Rep. Ro Khanna. Both are Democrats.
Titus will attempt to add more co-sponsors before the bill is eventually taken up by the House Ways and Means Committee. Rep. Troy Nehls (R-Texas) and Rep. Steven Horsford (D-Nev.) joined Titus as co-sponsors on Monday.
