For most people, gambling is just a way to enjoy some time and potentially win money. However, professional gamblers who play poker or other card games for a living make loads of money doing this. However, they’re also at risk of having big losses. This was worth it for most pro gamblers, as they can deduct 100% of their losses from their taxes. Unfortunately, the new Big Beautiful Bill is bringing change, which changes this around!
The 900-page Bill has a hidden clause for Gamblers
The reason the bill was named “The Big Beautiful Bill” is that it was nearly 900 pages long. Only after the bill was passed did people start to notice some of the details. While most changes were already publicly known, there were some changes that were just skipped by most people.
However, in the 900-page document, there is a hidden clause for professional gamblers and the way their income works. The key change? A change in the Loss Deduction Cap from 100% to 90% which is not beneficial for gamblers at all.
Why is the bill a problem for Gamblers?
For the rest of 2025, gamblers can deduct 100% of their losses from their income. So, if they win $ 100,000 and then lose $ 100,000, they would break even for income tax purposes. However, starting from 2026, Gamblers will only be able to deduct 90% of their losses. So even if they lose $100.000, for tax purposes, they can only deduct $90.000.
This would mean that for the IRS, they would still owe taxes on those $10.000, which they don’t have. So gamblers have a chance of paying taxes on phantom income. Most professional Gamblers work with thin margins and play with big amounts. This means that they will be at risk for having to pay income tax on money they never made.
This change could eventually lead professional gamblers to leave the US. In addition, the prize pools for these competitions might become smaller, which makes them less attractive. This would cause damage to the existing gambling ecosystem.
