New Tax Hike: Gamblers Face $1.1 Billion Burden in Trump's Bill

A big change is coming for gamblers in the U.S.

Under Donald Trump’s new tax bill, gamblers could face a massive $1.1 billion hit every year. That’s right, if you enjoy betting, even just for fun, this new rule could cost you more than you think.

The bill targets gambling winnings and makes it harder to avoid taxes on them. It limits deductions and pushes platforms to report more to the IRS.

We’re looking at a future where even small wins might be fully taxed. A lot of people might not be prepared for this change. Whether we’re placing bets online, visiting casinos, or joining fantasy sports, this change affects us all.

Let’s break down what’s inside the bill, how it affects everyday players, and what steps we can take to protect ourselves.

Because this time, the house isn’t the only one taking our money, Uncle Sam wants a bigger share too.

What’s in Trump’s New Tax Proposal?

Currently, gamblers are allowed to deduct their losses in full, but only up to the amount they’ve won. Trump’s Senate proposal reduces that deduction limit to 90%.

Here’s how it works:

If you earned $100,000 and lost $100,000, you’d owe tax on $10,000.
The change affects all forms of betting, slots, sports, poker, horseracing, and even online platforms.

This isn’t a temporary fix. It kicks in from 2026 and stays unless Congress changes course.

Breaking Down the $1.1 Billion Burden

The Joint Committee on Taxation and Bloomberg estimate it will raise about $1.1 billion over the next eight years.

Let’s look at who it affects:

Casual bettors who break even: suddenly taxed on money they never made.
High-volume and pro gamblers suffer “phantom income” taxes, even in losing years.
Online bettors: losses are counted by tracking tools, so no escape.

States that pump up betting, like Nevada, New Jersey, and Kentucky, will feel the squeeze. Las Vegas lawmaker Dina Titus called it an “anti-gambling provision” that could hurt jobs and tourism.

Winners and Losers: Who’s Affected Most?

Winners

The federal government gains about $1.1 billion in revenue.
Budget hawks: They see every revenue boost as a win.

Losers

Casual and low‑income bettors: taxed on non-existent earnings.
Professional poker players and sports bettors: significantly impacted. Phil Galfond warned: “You’d pay tax on more than you made”.
Horse racing: could see a decline in betting handle. NTRA CEO Tom Rooney fears a “ripple effect” through the industry.
Casinos and iGaming platforms may lose top bettors, who bring steady volume and publicity.

Tourism: Vegas, Reno, and racetracks rely on big‑time betting. Riding revenue declines hurt local economies. State revenue: U.S. gambling revenue hit $72 billion in 2024, with $15.9 billion going to states.If gamblers back off, that pool shrinks.
Problem gambling: Support services are already underfunded. With less legal play, shadier sites may draw users, and states collect less $$ for programs.

Growth in offshore betting: Gamblers may start using international platforms to escape higher taxes. That drains domestic tax revenue and undermines the regulated market.

Conclusion

This marks a significant shift in how gambling is taxed. A 10% cut in loss deductions doesn’t just raise money, it reshapes bettors’ behavior. People who only break even now pay tax. Pros may walk away. Legal markets might shrink.

Legislators like Rep. Dina Titus are pushing back, promising to amend or strip the language. But as of now, Senate language stands, and the House must vote again. If the proposal remains as is, the new tax rules will begin in January 2026.

Gamblers: keep a close eye on updates, track your losses, and if you’re in places like Vegas or Kentucky, political resistance is growing. We’ll all be watching what happens once this lands on the House floor.