Philly Plain Dealer

Donald Trump’s One Big Beautiful Bill is bad for many reasons, but this article will be focused on the specific changes made to gambling. According to the Tax Foundation, “a provision in the One Big Beautiful Bill Act limits gambling losses that can be used to offset gambling winnings to 90 percent of their value. This provision, which previously allowed for 100 percent deductibility of losses against winnings, introduces a steep tax penalty for professional gamblers and certain casual bettors.”

Starting January 1, 2026, the IRS will limit the deduction of gambling losses to 90% of winnings.

This means that Americans will now be taxed for their losing bets. The Tax Foundation puts forth the following example, if someone gambles $1,000,000 and then breaks even and leaves with $1,000,000, they will be taxed on 90% of their wagers. Under current rules, someone who breaks even on $1,000,000 currently owes $0 in taxes, because they won nothing. Under the new law, their tax liability would be $37,000. Meaning they no longer broke even, they lost. 

These changes would be detrimental to casual gamblers who place bets on their favorite teams or when they go to game, who will have unexpected tax liabilities that they didn’t have the previous year.

This gambling provision was snuck into the Big Dumb Bill without deliberation as a last minute amendment. According to Albin, Randall, & Bennett “the original House resolution intended to only make the limitation of gambling losses equal to gambling winnings permanent.”

Currently, there is a bi-partisan coalition attempting to repeal these taxes. Dina Titus (D-Nevada), Troy Nehls (R-Texas), and Ro Khanna (D-California) are supporting the “FAIR BET” Act, which would restore gambling loss deduction limits to 100 percent of gambling winnings.

In 2026, Americans will be going up against the house and the federal government. Breaking even is no longer good enough, losers will lose and be taxed on their losing. Cash out your futures, enjoy weeks one through seventeen of the NFL and the MLB playoffs, then beware of Donnie’s gambling tax in 2026.