Big Budget Bill Awaits Trump’s Signature with Gambling Deduction Cap in Place

^{Republican Speaker of the House Mike Johnson celebrates the narrow passage of the biggest government spending bill in history, with seemingly little concern for complaints voiced by professional poker players and sports bettors. (Photo: Francis Chung / AP)}

The House of Representatives passed the One Big Beautiful Bill Act (OBBBA) on Thursday, including in its mammoth text a provision that will cap gambling losses and related deductions at 90 percent of their total amount.

That provision, which was introduced in the Senate version of OBBBA, caught the attention of gamblers and others this week who noted it could make it nearly impossible for anyone to gamble professionally in the United States.

GOP Wins Over Enough Holdouts to Pass OBBBA After Overnight Session

OBBBA passed 218-214 after Republican leaders were able to eliminate almost all opposition within their ranks following a marathon overnight session. House Minority Leader Hakeem Jeffries (D-New York) delayed passage for more than eight hours by delivering a record-breaking speech blasting the bill, but it only pushed the vote into the afternoon.

The original House version of OBBBA did have provisions that hurt those who deducted losses for gambling. While expenses were previously considered separately from gambling losses, and thus weren’t subjected to rules limiting deducting losses to the full amount of winnings, the House version of the bill included language that combined both types of deductions into one category that couldn’t exceed reported gambling winnings.

But it was the Senate change that caught gamblers by surprise and sparked outrage from some on social media. The 90 percent limit on deductions now means that a player can potentially pay more in taxes than they won, or even owe taxes in a losing year – a reality that could severely curtail professional gambling in the United States, and potentially hurt casual gamblers who hit a big, reportable win at a casino.

Rep. Titus Working on Bill to Change Gambling Tax Provision

Even as OBBBA goes to President Donald Trump’s desk – he has vowed to sign it on Friday, July 4 – it might not be the final word on the changes to gambling tax law.

Representative Dina Titus (D-Nevada) wrote on Twitter that she is “working on a bill now that would reverse this unfair anti-gaming tax provision.”

“It pushes people into the black market if they don’t do regulated gaming because they have a tax disadvantage,” Rep. Titus told News Nation. “And the black market doesn’t pay taxes, isn’t regulated, doesn’t help with problem gaming, so it’s bad for the industry as well as for the player.”

Beyond a specific bill designed to reverse the gambling tax provision, there are a couple other pathways to reversing the changes. 

For one, Congress could pass a technical corrections bill to edit OBBBA. Such bills are commonly used to fix unintended consequences or outright errors in legislation without substantially changing the underlying policies. In this case, that could mean returning to the House version that did combine expenses with gambling losses, while retaining the ability to deduct 100 percent of that total up to the amount of a player’s winnings. 

The change could also be made in a second reconciliation package in the fall, which House Speaker Mike Johnson (R-Louisiana) has said is a legislative priority. 

In either case, gamblers should be aware that the new rules will not be implemented on their 2025 federal taxes, but rather when paying taxes on 2026 winnings. As such, a bill passed later this year would be enough to prevent the 90 percent limit on deductions from ever going into effect.