US House Rejects Effort to Restore Full Gambling Loss Deduction, Remains at 90%

A push to change how gambling losses get taxed at the federal level stalled again in Washington. Lawmakers reviewed dozens of proposals tied to a major spending package, but one issue tied closely to bettors and casinos failed to advance.

The outcome keeps a controversial tax rule in force for now, even as pressure builds from Nevada officials, industry groups, and tax advisers.

Good to Know

• Federal law still caps gambling loss deductions at 90 percent
• The proposal failed at the House Rules Committee stage
• Nevada lawmakers say the effort will continue through other bills

Lawmakers in the US House rejected an amendment that would have restored the full federal tax deduction for gambling losses. The proposal never reached the House floor after the House Rules Committee declined to include it in a must-pass spending bill.

The amendment aimed to allow gamblers to deduct 100 percent of annual losses on federal tax filings. Without approval from the committee, the language stayed out of the Consolidated Appropriations Act, which the House passed later in the week.

The failed effort targeted a tax change enacted last year under the One Big Beautiful Bill Act. That law limits gambling loss deductions to 90 percent. Tax professionals and gambling industry officials argue the cap creates taxable phantom income for players who break even across a full year of betting.

US Rep. Dina Titus of Nevada appeared before the House Rules Committee to argue for including the deduction fix. Her proposal stood among nearly 70 amendments considered during the session, according to reporting from the Las Vegas Review-Journal.

Industry advisers say the 90 percent limit hits professional gamblers and high-stakes players hardest. Poker players, high-limit slot players, and sports bettors face potential tax bills on money never actually kept, based on how winnings and losses get calculated under the current rule.

In a statement released Friday, Titus said she was “disappointed that the House Rules Committee has decided not to move forward with legislation to restore the full 100 percent deduction for gambling losses.”

“I led the charge to (restore the 100 percent deduction) with the FAIR BET Act I introduced last July after we discovered this tax on phantom winnings hidden in the OBBB,” Titus said. “I also have said from the very beginning that it doesn’t matter how this unfairness is rectified — it just needs to be fixed. It’s about righting a fundamental wrong that affects every person who gambles.”

With the amendment rejected, the proposal lacks a clear legislative path unless lawmakers attach it to another must-pass bill later in the year or advance it as standalone legislation.

Titus and other members of the Nevada congressional delegation say work will continue. In the Senate, Catherine Cortez Masto and Jackie Rosen, both Democrats from Nevada, along with Republican Ted Cruz of Texas, co-sponsor the FULL HOUSE Act, which also seeks to restore the full deduction.

Industry lobbying has already intensified. In December, casino executives from Las Vegas representing major operators, alongside the primary gambling industry lobbying group, met with US Rep. Jason Smith of Missouri. Smith chairs the House Ways and Means Committee, which oversees tax legislation.

“There will be other opportunities this year to insert the language into another piece of legislation for consideration on the House floor,” Titus said. “I will pursue those opportunities until we get this done.”

FAQ

What did the House reject?

An amendment that would have restored the ability to deduct 100 percent of gambling losses on federal tax returns.

What rule stays in place now?

Gamblers can deduct only 90 percent of losses under current federal tax law.

Why do critics oppose the 90 percent cap?

Tax experts say it can create taxable phantom income for players who break even over a year.

Who feels the impact most?

Professional gamblers, poker players, high-limit slot players, and sports bettors face the largest exposure.

Is the issue finished for 2025?

No. Lawmakers say they plan to push the change through other legislation or standalone bills.

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