07/10/2025
Yes, the information you've shared about the gambling tax changes under the new “Big Beautiful Bill” is accurate based on current reporting:
✅ Key Facts Confirmed:
Starting in 2026, gamblers will only be able to deduct 90% of their gambling losses against their winnings, rather than 100% as previously allowed 1 2.
This means if you win $100,000 and lose $100,000, you can only deduct $90,000 — leaving you with $10,000 in taxable income, even though your net profit is zero 3.
At a 24% federal tax rate, that would result in a $2,400 tax bill on no actual profit, just as your example described.
This change disproportionately affects professional and high-volume gamblers, who operate on thin margins and rely on full deductibility to remain profitable 3.
Experts warn this could lead to:
Reduced betting volume
Worsened odds and spreads due to the loss of “sharp money”
Shrinking prize pools in DFS (Daily Fantasy Sports)
Lower tax revenue for states due to decreased handle 3
🎯 Bottom Line:
This is not just a tax on income — it effectively becomes a tax on betting volume, which could drive professional gamblers out of the regulated U.S. market and disrupt the broader gambling ecosystem.
The taxman
Here’s how gambling taxes have always worked: If you win $100,000 and lose $100,000, your net profit is zero, and you owe no tax. It’s how nearly every business is taxed. You pay based on your profits, not your gross revenue.
The Senate bill changes that.
Under this provision, you can only deduct 90% of your losses. So, in the same example — $100,000 in winnings, $100,000 in losses — you can only deduct $90,000. That means you’re taxed as if you made $10,000, even though you didn’t.
At the standard 24% federal tax rate, that’s a $2,400 tax bill on zero profit.
Another example: Win $101,000, lose $100,000, and you’re technically up $1,000. Under this new law, you’d owe $2,640 in taxes— more than twice what you made.
That’s not a tax on income. That’s a tax on volume. And for professional gamblers — who play high-volume, low-margin games to squeeze out small but consistent profits — it’s a death sentence.
But this isn’t just about the pros getting squeezed.
Professional and high-volume gamblers are the backbone of the system. In sports betting, they’re the “sharp money” that helps sportsbooks set accurate lines and balance risk. In daily fantasy, they’re the reason giant prize pools exist.
How much do they matter? And what happens if they disappear?
It’s a good question. So good, in fact, I burned one of my free Google Gemini Deep Research queries on it. Most of the following comes from that research.
In DFS, fewer than 2% of players win 90% of profits. They’re not just winning — they’re funding the prize pools with massive daily entry fees.
In sports betting, they account for massive volume, which drives liquidity and efficiency, which benefits every bettor by narrowing odds and spreads.
These aren’t whales throwing around money. They’re skilled, data-driven businessmen and women treating gambling like a business. Take them out, and the ecosystem collapses.
If this bill becomes law, professional gamblers — already operating on razor-thin margins — will exit the regulated U.S. market. This isn’t a guess; it’s simple economics.
What comes next is a chain reaction, per our AI pal.
Betting volume drops: High-volume players cycle millions through sportsbooks. When they leave, so does that action.
Odds get worse: Without sharp money helping to shape lines, sportsbooks will widen spreads and increase the vig to manage risk. Everyone pays more to play.
Prize pools shrink: In DFS, remove the high-volume pros, and a $10,000,000 contest becomes a $10,000 contest. That’s not just bad for them. It’s bad for everyone chasing those prizes.
States lose money: Gambling taxes are based on operator revenue, which comes from handle. Less volume means less revenue. Less revenue means lower tax collections.
https://www.ingame.com/big-beautiful-bill-destroy-gambling/?fbclid=IwY2xjawLcvj9leHRuA2FlbQIxMQBicmlkETFLNnlUMmdkbzJEMFZmeHBnAR7MZfI2_eGFzVGRvqqV1RxQK7eQ1lwGRovzTignOG0IVJDslh3QgeyRt48bxA_aem_3GuCOSTyUyGD7XB-Oi80Yw
Hyberbole? Well, if this bill passes, imagine a gambling system not being fed professionals
