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- The House Ways and Means Committee voted 38-5 to advance a broader tax package incorporating the FULL HOUSE Act, moving Congress closer to restoring the full 100% federal deduction for gambling losses.
- Lawmakers and industry stakeholders pushed for the correction to prevent a scheduled Jan. 1, 2027 rule change that drops the deduction cap to 90%, which would otherwise force gamblers to pay taxes on “phantom winnings” even if they broke even or lost money overall.
The House Ways and Means Committee voted 38-5 to advance legislation that would restore the 100% federal deduction for gambling losses, moving the issue closer to a full House vote.
The measure matters because the current federal rule reduces the deductible amount to 90%, a change supporters say could leave some gamblers owing taxes even when they did not finish the year with a net profit. Backers want Congress to act before the revised rule is set to take effect on Jan. 1, 2027.
Rep. Dina Titus has pushed the FAIR BET Act, while Rep. Steven Horsford backed the FULL HOUSE Act, which was incorporated into a broader tax package approved by the committee. According to the source report, the legislation now heads to the full House and would still need Senate approval and the president’s signature to become law.
Why lawmakers and the gaming industry want the rule changed
Supporters argue the 90% cap can create tax liability on what Titus called “phantom money they never won.” The source report used an example in which a gambler records $100,000 in winnings and $100,000 in losses. Under a 90% deduction, $10,000 could still be treated as taxable income.
Titus said after the vote, “After 14 months of fighting to get this commonsense, bipartisan fix through committee, we must now encourage the House to approve this measure before Jan. 1, 2027.” She also said House and Senate leaders need to move quickly if Congress is going to prevent the tax change from taking effect.
Horsford tied the issue to Nevada’s broader gaming and tourism economy, which relies on retail operations as well as the growing online casino sector. “No one should pay taxes on money they never earned,” he said, adding that the current tax treatment puts jobs and businesses at risk.
What happens next in Congress
The bill’s next stop is the full House of Representatives. If it clears that chamber, the proposal would still need to pass the Senate and receive the president’s signature.
The effort has support from 25 co-sponsors and from several major gaming companies and trade groups, including the American Gaming Association, MGM Resorts International, Caesars Entertainment, Wynn Resorts, DraftKings, FanDuel, the Nevada Resort Association, and the National Thoroughbred Racing Association.
In the Senate, Catherine Cortez Masto, Jackie Rosen, and Ted Cruz have co-sponsored related legislation, according to the source report.
AGA President Bill Miller said the group supports restoring the full deduction and urged Congress to pass the measure. For online betting and casino operators, the issue is broader than Nevada: it affects a federal tax rule that could shape how legal-market customers are taxed across the U.S.
Source: As reported by news.worldcasinodirectory.com.
