The proposal to restore the gambling loss tax deduction eliminated by Donald Trump’s One Big Beautiful Bill Act will now move to the House floor.
Key takeaways:
- The House Ways and Means Committee approved a bipartisan tax package that includes Democratic representative Steven Horsford’s FULL HOUSE Act, which restores the 100 per cent deduction of gambling losses.
- The measure would reverse a provision in President Donald Trump’s One Big Beautiful Act of 2025, which limited deductions to 90 per cent, potentially taxing gamblers on income they never earned.
- The American Gaming Association welcomed the move, with President Bill Miller calling it a crucial step to ensure gamblers are not taxed on “phantom income” and urging Congress to pass the FULL HOUSE Act.
US.- The House Ways and Means Committee has advanced a proposed tax package that would reinstate the full tax deduction of gambling losses. The bipartisan package cleared the committee by a 38-5 margin and will now head to the House floor.
The proposal is intended to reverse a reduction introduced under Donald Trump’s One Big Beautiful Bill Act over a year ago in July 2025. While gamblers had previously been able to deduct all gambling losses, the OBBA limits tax deductions to 90 per cent of losses, meaning that gamblers could face a tax liability even if they make a net loss.
For example, a gambler who won $1m but also lost $1m could only deduct $900,000, leaving them taxed on $100,000 of income they never actually earned.
The Democratic representative Dina Titus of Nevada was the first politician to raise concerns about the measure, warning that it penalised responsible gamblers and harmed areas whose economies depended on casinos. She raised concerns that players could turn to unlicensed operators.
The measure advanced by the House Ways and Means Committee includes representative Steven Horsford’s FULL HOUSE Act, which would permit professional gamblers to deduct 100 per cent of their losses, provided they do not exceed their winnings, when filing federal tax returns. It cleared the committee by a 38-5 margin and will now head to the House floor.
Horsford and Titus have spent the past year attempting to restore the 100 per cent deduction through standalone bills.
“At a time of economic uncertainty, my job is to protect Nevadans and their jobs,” Horsford said in a press release. “From dealers and housekeepers to restaurant workers and small business owners, families across our state depend on visitors choosing Nevada. This unfair tax puts their livelihoods at risk. That’s why I fought to advance my FULL HOUSE Act, and I won’t stop until we get this relief signed into law.”
He added: “No one should pay taxes on money they never earned,” he said. “This is about the workers supporting their families, the small businesses keeping their doors open, and the communities that make Nevada home. I stayed at the table because they deserve results. Today, we moved closer to delivering.” Titus welcomed the committee’s decision to move the legislation forward.
American Gaming Association President Bill Miller welcomed the development. He said: “The American Gaming Association is grateful for this critical step forward in restoring the 100 per cent gambling tax deduction. We encourage Congress to pass the FULL HOUSE Act to ensure that consumers choose the legal market where protections exist and are not taxed on phantom income. Thank you to the Ways and Means Committee as well as Representatives Horsford and Miller for their leadership in advocating for this bipartisan measure. We look forward to working with our partners in Congress to get this passed.”
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