Dina Titus Introduces Bill to Restore Full Gambling Loss Deduction Following Big Beautiful Bill

^{Nevada Rep. Dina Titus says her new bill could serve as a correction to the hotly contested gambling tax that was added to the latest version of the new budget law signed on July 4 by President Trump. (Photo: Travis P Ball/Sipa USA)}

Representative Dina Titus (D-Nevada) has introduced a bill that would once again allow gamblers to deduct the full amount of their gambling losses after a controversial provision in the One Big Beautiful Bill Act (OBBBA) put a 90 percent cap on such deductions.

Known as the Fair Accounting for Income Realized from Betting Earnings Taxation (FAIR BET) Act, Rep. Titus’ bill would allow for the full deduction of losses and expenses each year up to the amount of an individual’s gambling winnings.

Titus: Unfair Rules Could Push Gamblers to Unregulated Sites

The 90 percent provision, which was inserted into the Senate version of the OBBBA, garnered attention from professional gamblers in the days before the bill’s passage. Many fear that the new rules, which would go into effect on 2026 gambling income, could essentially make it impossible to gamble professionally, and might even lead to gamblers who lose money overall owing taxes on their “winnings.”

“My FAIR BET Act would rightfully restore the full deduction for losses so gamblers don’t pay taxes on money they haven’t won,” Rep. Titus said in a statement. “This common-sense legislation will bring fairness back to gaming taxation, making sure that gamblers can fully deduct losses when they report their winnings. It gives everyone – from recreational gamblers to high-stakes gamblers – a fair shake.”

Titus had previously shared concerns that the new taxation rules could push players to black market sites where their winnings would go unreported, after which they would not pay taxes on any earnings at all.

“We should be encouraging players to properly report their winnings and wager using legal operators,” Rep. Titus said. “The Senate change will only push people to not report their winnings and to use unregulated platforms.”

Multiple Paths Exist to Reverse Deduction Cap

The 90 percent provision in OBBBA was introduced by Sen. Mike Crapo (R-Idaho). The biggest issue for players arises when a player wins or loses with a narrow margin on a high volume of play. For instance, a player who wins $10,000 in a jackpot but then loses it all back to the casino would only be able to deduct $9,000 in losses, meaning they would still owe taxes on $1,000 of their earnings. Under the longstanding 100 percent deduction, they would own no taxes. 

But even outside of those edge cases, the new rules could dramatically raise taxes on high-stakes players and professional gamblers. For those winning and losing millions, there could be hundreds of thousands of dollars in losses that can’t be deducted.

It’s unclear whether Rep. Titus’ bill will gain any traction in Congress. But even if it doesn’t, there are other ways that the OBBBA change could be reversed. Republicans are planning to attempt to pass a second reconciliation bill in the fall, which could include a provision restoring the 100 percent loss deduction. That deduction could also return via a technical corrections bill, a common type of legislation used to fix errors and unintended consequences in complex bills.