Congress Reconsiders Tax Treatment for Gamblers with Full House Act Introduction

Federal tax treatment for gamblers returned to the spotlight after lawmakers introduced new legislation aimed at reversing a recent change that altered how losses get deducted. The proposal arrives after concerns from players, casinos, and tourism leaders who warn the rule creates tax bills disconnected from real gambling results.

The measure frames gambling as part of a broader service economy tied to travel, entertainment, and hospitality.

Good to Know

• Current federal rules cap gambling loss deductions at 90 percent
• Gamblers can owe taxes even when total winnings and losses cancel out
• Lawmakers from Nevada and Ohio introduced a bipartisan fix

What the Full House Act Seeks to Change

The Full House Act landed in Congress as a bipartisan effort to roll back a tax provision tied to the GOP Big Beautiful Bill. That provision altered decades of precedent by limiting how much gambling losses can offset reported winnings.

Supporters argue the rule treats gambling differently from other activities where net income determines tax liability. Under current law, gamblers deduct only 90 percent of losses, even when overall results break even.

That structure affects professional poker players, casual bettors, and visitors who travel for gaming events.

Lawmakers Say Rule Hits Tourism and Fairness

The bill comes from Steven Horsford and Max Miller. Both described the legislation as a correction rather than a policy shift.

The formal name, Facilitating Useful Loss Limitations to Help Our Unique Service Economy, reflects concern for industries built around discretionary spending such as gaming, hotels, and live events.

“Taxing people on money they never actually earned is fundamentally unfair and harmful to Nevada’s economy,” Horsford told KLAS. “This policy would drive tourism across our state elsewhere. There is strong bipartisan agreement that this provision was a mistake, and Congress must act to correct it.”

How the Current Rule Works in Practice

Under existing federal tax rules, a gambler who wins $100,000 and loses $100,000 can still owe taxes on $10,000. Loss deductions stop at 90 percent, regardless of the final outcome.

Critics say that setup discourages large tournaments and extended casino visits, especially among professional players who cycle high volumes of wagers.

Industry advocates warn the rule also complicates tax reporting and creates confusion for recreational players unfamiliar with detailed record keeping.

Earlier Efforts Fell Short

Another Nevada lawmaker, Dina Titus, previously tried to address the same issue through the Fair Bet Act. That proposal stalled after the Rules Committee declined to move it forward.

Supporters of the Full House Act believe broader bipartisan framing gives the new bill a better chance. Backers also point to growing pressure from gaming states where tourism ties directly to gambling activity.

FAQ

What problem does the Full House Act address?

The bill aims to restore full deduction of gambling losses against winnings for federal tax purposes.

Who introduced the Full House Act?

Steven Horsford from Nevada and Max Miller from Ohio introduced the legislation.

How does the current tax rule affect gamblers?

Gamblers can owe taxes even when winnings and losses cancel out due to a 90 percent deduction cap.

Did Congress attempt a similar fix before?

Yes. Dina Titus introduced the Fair Bet Act, but it failed to advance in committee.

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