The ‘Big Beautiful Bill’ was a Christmas tree of wishlist items for the Presidents and for legislators whose votes were needed for passage. But at over 1,000 pages, there are bound to be Easter eggs – special interest provisions as well as time bombs we don’t know about yet.
Just before it was voted on, one provision was discovered that made it into the final bill that will kill off casino loyalty programs like MGM Rewards and Caesars Rewards: recording your gambling transactions is going to mean a bigger tax bill, even when you lose money gambling. People aren’t going to want these loyalty programs to record their gambling!
Las Vegas Airport
The big ticket items in the bill are a grab bag of good policy and very bad policy, and have been broadly covered:
- Personal taxes: Permanent extension of 2017 tax rate cuts and increased standard deduction; SALT cap increased to $40,000 for 5 years (phasing out at modified adjusted gross income of $500,000+); no tax on tips and overtime through 2028; temporary additional $1,000 deduction for seniors; child tax credit permanently raised to $2,200.
- Business taxes: 100% bonus depreciation and R&D expensing made permanent; 20% passthrough deduction made permanent; corporate alternative minimum tax repealed.
- New spending: $175 billion on border and immigration funding (wall, ICE hiring, asylum courts); $150 billion defense add‑on; $50 billion rural health access fund (they needed Susan Collins to vote for it, Lisa Murkowski got exemption for Alaska from changes to Medicaid and Supplemental Nutrition Assistance Program plus tax breaks for whaling captains); debt ceiling increase of $5 trillion through 2029.
- Entitlements: Medicaid work requirements for non‑disabled adults, narrower eligibility for states covering undocumented immigrants; SNAP tightened (annual eligibility check, 3‑month limit for able‑bodied adults without kids).
- Energy & regulatory: Phase‑out of most Biden-era clean‑energy credits, incentives for nuclear & liquid natural gas export terminals.
There’s a major change in the tax code ot how gambling winnings are taxed.
- Currently (through 2025), IRC §165(d) permits taxpayers to deduct 100% of gambling losses against gambling winnings, up to the amount of their winnings. If you won $100k and lost $100k you broke even – you had no net winnings, and owed zero tax.
- However, starting January 1, 2026 §165(d) is amended to only permit deduction of 90% of gambling losses against winnings.
This means that someone who breaks even gambling will owe taxes and someone who loses money will likely owe money for having won. Here are a few examples.
| Scenario | Winnings | Losses actually incurred | Allowed loss deduction (90 %) | Actual Net | Taxable gambling income |
| Break‑even rec bettor | $100k | $100k | $90k | $0k | $10 k |
| Slight overall loser | $200k | $210k | $189k | (-$10k) | $11 k |
| Big winner | $300k | $50k | $45k | $250k | $255 k |
| Low‑volume player | $10k | $20k | $10k (cap = winnings) | (-$10k) | $0 [unchanged] |
So how does this affect casino loyalty programs? The entire premise is that gamblings get all of their transactions recorded, and that’s how the program knows what rewards to give you.
But no one will want their gambling recorded because just about everyone will now owe taxes when they gamble. Not recording the transactions doesn’t mean you don’t owe, but it does mean no one may know. (Similarly to when you receive income but no 1099 – most people don’t report the income.)
- Members will avoid using the loyalty programs in order to evade tax.
- And give up perks and comps as a result.
Perks and comps, for most, aren’t worth paying income tax for. All of a sudden the comps are no longer complimentary!
And fewer incentives means fewer players, fewer room nights, fewer shows, reduced food and beverage and a decline in jobs at casino destinations.
By the way that’s going to be entirely consistent with what proponents wanted to see happen. It is not an accident or byproduct. The goal here isn’t the revenue raising for CBO scoring of the bill. The goal here is to discourage gambling through the tax code. And that may come down like a hammer on casino loyalty programs.
All of this negative stupidity concerning deductions and tax paying will effect very few people – this is just ANOTHER made up “crisis” made by DemocRats. Vote OUT every DemocRat.
A bit of a stretch — because addicts will find a work-around to justify their addiction.
deductions from 100% to 90%? not my problem.
“The big ticket items in the bill are a grab bag of good policy and very bad policy”. Really, Gary, stated as fact and not more correctly as your opinion ? In the immortal words of Master Yoda: “”So certain are you”. Stick to travel, Gary, it’s why we read your column.
“No tax on tips and overtime” is severely limited making it near useless.
Interesting. I never would have noticed if Gary had not brought this up. I remember when Congress got rid of online Poker by de-banking it. It got rid of my ability to lose money to bots on the Poker sites. I even used to play at the airport when I got there early (referencing the View From the Wing article about getting to the airport early and wasting time).
I once met a retired guy on the plane that liked play slots. He said “Of course, I lose money, but I get free cruises all around the world all the time. Losses basically pay for my cruises.” I wonder if this will negatively impact people like him
given how much gambling has increased in the US, the total offset is probably minimal for the country. Some high volume gamblers will be affected but it is a pretty small minority. and it does send a signal that, if you are going to go big, make sure you win.
I really believe in taxing income (as well as excess assets), but taxing people that lose money seems to be fundamentally unfair. I have no love for gambling, but if we allow it, we ought treat the practice fairly in the tax code.
I hope the Adelsons are happy with their vote, now that the Leopards have won.
@Travel Hacktivist you seem to be an expert in addiction medicine. Tell me more about how addiction is a choice and how people want to remain addicts. Then you can explain to me how cutting healthcare for the poor and food for the hungry in order to make tax cuts for people making millions of dollars a year is the right call for America. Hard data over political sound bites would be appreciated.
Overstated and there is already a bill filed to address this by a NV Senator. Also unclear if casino win/loss statements will be reported to the IRS (nothing in bill states that) or simply the 1099s as is currently done. If that’s the case minimal impact since you can get a lot of points w no 1099 filed. Trust me I know and have had my share of gambling 1099s.
If only 90% of 1099 winnings can be offset not a huge issue for majority of gamblers.
Similar to Gary poker sites are going crazy about impact on professional poker players (they can deduct travel and actually show a loss for carry over since it is their job) but, again, I think this is overstated and both future bills as well as clarification language from IRS will address it
I love it when Gary posts anti-t-dumprump stories and the first posts are support of the the fascist agenda. Post a normal story about boarding procedures or meals and they stay quiet. I beg you Gary, no more posts like this. It scares me knowing I’m on a plane with some of the rightwing idiots.
Gary, not using your player card does not prevent issuance of a 1099G for slot wins above $1,200. High limit slot players will have to stop playing to avoid a tax on 10% of their gross. This will wipe out the casinos financially. This provision will be repealed, because it will decimate a big industry nationwide.
Ray crises “fascist agenda” gets his big boy feelings hurt because he’s scared to get on a little bitty plane with “right wing idiots” Baby Ray no like common sense ideas. Baby Ray brain damaged and woke. Baby Ray the problem. Don’t be like Baby Ray.
Even before this tax bill there was already a problem with deducting gambling losses. For many decades thee casino must issue a 1099 for slot jackpots over $1250. So those winnings get counted as earnings but your are only allowed to deduct losses once extent they exceed the standard deduction if you don’t itemize. So the small fry get screwed and have to pay taxes in any jackpot even if they lose money overall.
One real problem here is no one knows how it got in there, nor who put it there. And no one noticed until after the bill had passed. That’s a problem, period, and not just for this issue. (Sleazy lawyers do this after negotiations are closed and signing documents are sent out. My wife catches them by running a track changes on the signing documents, but most lawyers aren’t that careful.) Senate and House rules need to be amended so that all bill provisions have a members name attached, and no changes are allowed after a certain point before a vote or all changes have to be noted separately.
Cruises are going to explode!
This is right up @Retired Gambler’s alley!
….so does this mean the Centurion and Cap 1 LAS lounges will be less crowded?
In all seriousness, @C_M, apparently this was added by Mike Crapo. I’m not familiar with how it all works but I would agree that any changes should be attributed to a specific person.
Why should we care? The country has far bigger issues to deal with than whether Joe Diceroller won or lost.
@David R. Miller
Another disastrous Spend But Don’t Tax budget by the RepulsiveCONS. In order to get a balanced budget and replace basic needs for the poorest Americans, Democrats will have to raise taxes and take the heat for it.
As senior, this bill will net me a few thousand more dollars every year, but it will not change my life. It will however, change the lives of the poorest Americans who will lose much-needed benefits and medical insurance.
The law does not require casinos or betting apps to generate new reporting for individual users via loyalty programs or player cards.
I worry what this law will do to tax revenues in Las Vegas as they depend on that revenue stream
OBBB. I love U-235. Incentives will get research and production past the Hollywood instigated fear campaign.
Not sure how anyone “looses” medical benefits. Those who are ABLE BODY should be required to “work” for the benefits. That “work” requirement isn’t that much. There are exemptions for some that have legitimate inability to fulfill the work requirement. That’s absolutely fine with me. For leeches who have a college degree in a field that has no jobs…well buttercup…you’re gonna have to find something to do AND pay off that loan. I sure as hell ain’t payin’ for it! To some, gambling is a full time occupation. They get a 1099 and pay taxes just like other workers. There’s no such thing as a free lunch! I agree that there should be some accommodation for tips and overtime but both are part of a paycheck and, in my opinion, should be taxable. What, then, keeps the employer to either not pay a salaried wage and let the worker rely solely on tips? That doesn’t ring true with me.
“…most people don’t report the income.”
That means “most” people are smart. Sending less money to the government is always a good thing.
You know, fellas, maybe austerity isn’t such a bad idea after all… not saying I like the guy or his policies, but gambling isn’t virtuous, and if those are the folks ultimately paying for tax cuts for the super rich, well, it could be worse… (don’t worry, I haven’t forgotten of all the actual poor and vulnerable who will be fed to the proverbial ‘wood chipper’ thanks to this bull, I mean, bill…)
Who writes these ridiculous, massive bills that the members of Congress don’t actually read before voting? This is a massive clown show.
The problem isn’t rewards programs, rather it’s sports gambling via app. This would marginally hit the online sports betting companies like Draftkings and Fanduel. I’m sure Senator Masto is no friend of these companies.