Nevada Gambling Industry Pushes to Restore Full Tax Deductibility of Losses

Poker legend Erik Seidel, a ten-time World Series of Poker bracelet winner with substantial tournament earnings, is reevaluating his future in professional gambling due to an impending federal tax policy alteration. Residing in Las Vegas for many years, Seidel has indicated that the new tax environment may compel him into retirement, a stance shared by many players he has consulted. The core issue stems from the One Big Beautiful Bill Act signed by President Donald Trump in July, which, beginning in 2026, will restrict gamblers to deducting only 90% of their gambling losses against winnings on their tax returns. Previously, the entire amount of losses could be deducted. Under the new scheme, a gambler who gains $100,000 but also loses $100,000 would face taxation on $10,000 of unaccounted income, effectively reducing the financial attractiveness of professional and recreational gambling. Nevada's legislature has been proactive in opposing this change, initiating efforts to reverse the deduction limitation shortly after its enactment. While a successful reversal has not yet been secured, there is optimism that legislative action will occur early in the year following the tax change's implementation. Congresswoman Dina Titus, representing Nevada in the House, has spearheaded the FAIR BET bill targeting the reinstatement of full loss deductions. She has encountered robust support from a broad range of constituents, highlighting concerns that the negative impacts extended beyond professional players to everyday individuals who wager on popular sports such as football. Senator Catherine Cortez Masto and Senator Jacky Rosen jointly introduced the FULL HOUSE bill in the Senate, advocating a bipartisan approach to achieve similar goals. Cortez Masto criticized the tax as detrimental to Nevada's economic vitality and is actively working to embed corrective measures within the forthcoming congressional appropriations package slated for January. Republican Representative Mark Amodei, Nevada's sole GOP member in Congress and chair of an appropriations subcommittee, is collaborating with Democratic lawmakers to restore the previous deduction status. After engagements with gaming leaders and discussions with House Ways and Means Committee Chair Jason Smith, Amodei expressed assurance that the needed fix would be part of the 2026 appropriations. Smith has also indicated belief in bipartisan agreement to reinstate full deductibility, though no fixed timelines have been formalized yet. Despite bipartisan cooperation, some skepticism remains among Democrats regarding the reliability of these assurances. Titus conveyed cautious optimism while stressing the importance of a signed legislative resolution to confirm the repeal. Meanwhile, Bill Miller, CEO of the American Gaming Association, anticipates a reinstatement in early 2026 and emphasizes widespread congressional support for overturning the tax change. Industry engagement continues at high levels to facilitate prompt action on this issue. The gambling industry's concern is immediate, as the new law technically takes effect on January 1 and applies to earnings and losses within the 2026 calendar year. Key stakeholders warn that the sector may see a decline in player participation at upcoming major tournaments, resulting in potential job losses among dealers and other casino personnel. Derek Stevens, CEO of Circa Casino Resorts, notes a tangible pullback from gamblers who plan their activities well in advance, directly affecting gaming revenue streams. Stevens further highlights a sense of urgency within the sector, underscoring that the tax could impair wagering activity for significant annual sports betting events like the Super Bowl and NCAA March Madness. The ramifications may extend to reducing slot machine engagement and encouraging bettors from northern U.S. states to seek alternative venues in Canada or engage with unauthorized offshore platforms to circumvent tax liabilities. Stevens detailed these concerns during strategic discussions with Congressional leaders to underline the broader economic consequences beyond the immediate gambling industry, affecting tourism, hospitality, and employment. An underlying challenge is the origin of this tax provision, which was inserted late into the Senate version of the bill with minimal public explanation. Representative Amodei speculates it may have been an inadvertent inclusion introduced by Senate staff. Reports have linked Senate Finance Committee Chairman Mike Crapo as responsible for including the provision, though the exact motivations remain unclear. Efforts to amend the tax have been complicated by political reservations, particularly among Republicans reluctant to amend a signature legislative achievement of President Trump. Titus mentioned concerns that opening the bill for revisions might lead to broader negotiations favoring other political interests, delaying or diluting the gambling deduction fix. Regarding potential executive intervention, President Trump recently made ambiguous remarks about gambling taxes, hinting at possible reconsideration without committing to action. The White House has not provided clear commentary on abolishing gambling taxes. Some officials, including Amodei, express uncertainty about the likelihood of presidential involvement in this congressional matter. From the perspective of professional gamblers like Seidel, the tax policy appears illogical and counterproductive. He notes that many countries do not tax gambling winnings and that the U.S. dominance in poker may decline if the financial viability deteriorates. Seidel appreciates lawmakers such as Titus who are engaged on this issue and emphasizes the lack of evident benefits derived from the new tax, suggesting political factors might explain the reasoning behind it. A meeting between Seidel and Titus is scheduled for early 2026 to further discuss these impacts and explore solutions. In sum, Nevada's gambling sector stands at a pivotal moment as it confronts this federally mandated tax amendment. With stakes high for individuals, businesses, and the broader state economy reliant on gaming revenue and tourism, lawmakers, industry executives, and players are advocating assertively for timely legislative correction to avert sustained financial disruption.