Another day, another dollar lost — well, another 90 cents lost, as yet another attempt to restore the gambling-loss deduction back to 100% didn’t get over the goal line.
This time, an effort to tack on the change via an amendment to H.R.7148, an appropriations bill, failed.
It was led by Rep. Dina Titus (D-NV), who testified before the Rules Committee Wednesday, noting that 25 other legislators on both sides of the aisle were co-sponsoring the notion.
“It’s a fairness issue,” she said. “You shouldn’t tax people on money that they don’t earn. It’s ghost money, it’s not fair, and we can fix it. I urge you all to please make this amendment in order and let’s go back to the way things were and should be.”
Speaking on behalf of the amendment from the Republican side was Rep. Max Miller of Ohio, who said moving the deduction back to 100% would be “aligning tax liability with actual economic reality.”
His points were so well taken that Rep. Jim McGovern (D-MA), ranking member of the Rules Committee, quipped, “Your bipartisan amendment sounds like a no-brainer, which probably means it won’t be made in order. I hope I’m wrong on that. … It just seems to be common sense. Why should you be taxed on money you don’t earn?”
In the end, the amendment appeared not to even make it into the bill and the Rules Committee adjourned without a vote on the matter.
How on Earth did we get to this point?
The problem started late last year, when Republicans passed President Donald Trump’s sweeping tax bill and, almost as an afterthought, changed the long-standing rule on gambling losses. For decades, gamblers could deduct 100% of their losses against their winnings. The new law capped that deduction at 90%.
Under the new rule, anyone who itemizes deductions and wins and loses the same amount over the course of a year would still owe taxes. A gambler who bets $1 million and books a $100,000 profit would be allowed to deduct only $810,000, being forced to pay taxes as if they won $190,000.
The change was slipped in near the end of the process with little public debate, and it didn’t take long for numerous efforts to attempt to undo it, starting with Titus’ FAIR BET Act, and leading to Reps. Steven Horsford, a Nevada Democrat, and Miller’s FULL HOUSE Act.
Supporters have tried a different tactic, like the one that failed Thursday: attaching a fix to larger, must-pass bills, hoping leadership would let it slide through as common sense. So far, that hasn’t worked either.
So the 90% cap stays, at least for now, even as lawmakers from both parties keep saying the same thing: You shouldn’t be taxed on money you never earned.
