Federal Budget Proposal Tips Scale in Favor of Anti-Gambling Measures, Puts Nevada at Risk
The U.S. Congress is currently considering three pieces of legislation aimed at restoring the 100% deduction for gambling losses, which was reduced to 90% by a recent tax law. The FAIR BET Act, FULL HOUSE Act, and WAGER Act are all pending in Congress, with the outcome depending on legislative action in the coming months.
The FAIR BET Act, introduced by Rep. Dina Titus, seeks to revert the deduction limit from 90% back to 100% for gambling losses. The bill has garnered bipartisan support and has been assigned to the House Ways and Means Committee. The FULL HOUSE Act, sponsored by Sen. Catherine Cortez Masto, was introduced in the Senate as S. 2230. Despite an unsuccessful attempt to pass it via unanimous consent, it is now pending before the Senate Finance Committee. The WAGER Act, filed by Republican Rep. Andy Barr, also aims to fully restore the gambling loss deduction and is assigned to the House Ways and Means Committee, enjoying bipartisan interest.
The need for these bills arises from a change in the tax code enacted on July 4, 2025, which limits the gambling loss deduction to 90%. This means that gamblers who break even by winning and losing the same amount would face taxable income on 10% of their losses. This change could have significant implications, particularly for professional gamblers and serious recreational bettors, who would be punished by being taxed on money they didn't keep at the end of the year.
The change could also affect casino revenues, state tax coffers, and the earnings of tipped employees. Moreover, it could push bettors underground before the new tax bill takes effect, potentially leading to money flowing into offshore websites and black-market bookies.
Notably, the objection of Sen. Todd Young to the FULL HOUSE Act puts $3 billion in revenue for Indiana at risk of being transferred into unregulated offshore gambling sites. The FAIR BET Act and FULL HOUSE Act are not just aimed at defending gambling industries, but at preserving the integrity of regulated gambling and preventing money from flowing into offshore websites and black-market bookies.
As the deadline for the new deduction limit approaches, lawmakers on both sides of the aisle have expressed a commitment to addressing the change before it takes effect on January 1, 2026. However, with Congress out of session until September, time is tight for any of these bills to be passed and enacted in time to reverse the deduction cut.
| Bill Name | Sponsor(s) | Chamber | Status (as of July 2025) | Aim | |--------------------------|-----------------------------|-----------------|---------------------------------------------------------|---------------------------------------------| | FAIR BET Act (HR 4304) | Rep. Dina Titus (D) | House | Introduced; assigned to House Ways and Means Committee; bipartisan support | Restore 100% gambling loss deduction | | FULL HOUSE Act (S. 2230) | Sen. Catherine Cortez Masto (D) | Senate | Introduced; failed unanimous consent; pending Senate Finance Committee | Restore 100% gambling loss deduction | | WAGER Act | Rep. Andy Barr (R) | House | Introduced; assigned to House Ways and Means Committee; bipartisan interest | Restore 100% gambling loss deduction |
The outcome of these bills will have far-reaching implications for the gaming industry and for taxpayers who gamble. As the debate continues, it is clear that Congress must move past partisanship and pass Titus' and Cortez Masto's proposals as soon as possible to prevent this ill-considered policy from being implemented.
- The FAIR BET Act has gained bipartisan support and is aimed at reinstating the 100% deduction for gambling losses, a move that could significantly impact not only the gambling industry but also taxpayers who gamble.
- The FULL HOUSE Act, also attempting to restore the full deduction for gambling losses, currently resides in the Senate Finance Committee, following an unsuccessful attempt at passage via unanimous consent.
- The WAGER Act proposes to reinstate the 100% gambling loss deduction and has garnered similar bipartisan interest.
- These pieces of legislation, including the FAIR BET Act and the FULL HOUSE Act, are not solely about defending the gambling industry; they aim to protect the integrity of regulated gambling and prevent money from flowing into offshore websites and black-market bookies.
- With the deadline for the new deduction limit approaching, it is crucial for Congress to address this issue expeditiously to prevent the ill-considered policy from being implemented, considering the profound consequences it could have on the gaming industry and taxpayers.
