Affects Of The New Gambling Tax Law

[mickeycrimm]

Redietz wrote:

"But I appreciate all of the alleged "APs" deciding, after blackjack has dried up, video poker has dried up, tax laws make both tournament poker and video poker money pits, that "APs" are now sports betting experts. Munchkin no longer plays blackjack in LV (which kewlJ seems to not mention much). Dancer plans to retire end-of-year due to tax laws. So now multi-accounting bonus-whoring sports is the ticket. Well, once upon a time, it may have been, but it won't be tomorrow. Sports books have cleaned up their legal language and are within their rights to seize your money if you do this stuff. Check Munchkin's videos for the latest."

Here's a link to an article by NPR on the new law:

https://www.npr.org/2025/07/25/g-s1-...trump-congress

Redietz has said he knows the "secret reason" this law was passed but won't divulge it. Well, I also know the, ahem, secret reason. The Senate Finance Committee, headed by Mike Crapo of Idaho, ignorantly thought it would raise about 1 billion dollars of tax revenue over the next ten years.

What nitwit, Crapo, doesn't know is professional gamblers ain't dumb enough to dump a billion dollars to him. They simply will not put their money into action where the edge is thin enough for them to fall into the tax trap set by Crapo and his idiots.

So the law will have the opposite effect of what they desired. Tax revenue coming from gamblers is actually going to go down. Way down. The Senate Finance Committee shot themselves in the foot.

I predict high stakes live poker tournaments will crash and burn. Tournament players will go back to offshore online tournaments. Guys like Negreanu will play online from Toronto. Plenty of spots around the world for professional tournament players to take up residence.

Poker cash game players in the United States will be little affected.

The edge in sports betting is thin enough to knock a lot of guys out of action.

Advantage video poker died 15 years ago. Yeah, there were a few hard headed stragglers but the real money is in other areas of machine play.

Slot AP's are little affected because they can move away from the thinner edges. With a session defined as 1 day the logbook stats can look something like this.

Total of winning sessions: 170K
Total of losing sessions: 15K
Net Earn: 155K

With the new law only 13.5K in losses can be deducted. So one would owe tax on 156.5K compared to 155K before. Like I said, little affect on slot AP's.

Can a session be defined as 1 day? Yes, it can, because the IRS has never ruled against it. And if they ever rule against it then a court challenge will develop.

KJ will have to tell us about the affects on blackjack play.

[Rob.Singer]

Dancer is quitting because of thin-edged vp? Not like him. You'd expect he'd move on to advantage slots. Maybe not tho because hes now in his 80's.

Although I'm not a slot player, I do keep an eye on some of the slots I've learned are of the "advantage slots" moniker. They seem plentiful compared to the very few vp opportunities still available (with benefits included). At Atlantis and Peppermill, the Bay Area Dragon Ladies run teams through the Reno casinos and they focus on advantage slots. See them all the time, and mgmt. is completely blind to all of it. I'll be at Atlantis a few nights next week on our way to Wyoming to pick up our new puppy, and I expect to see the same old song there regarding the teams. But Im now Black Diamond and they treat us like royalty, even though I mugged the hell out of them and Manarch Black Hawk this summer.

[redietz]

Dancer is quitting because of thin-edged vp? Not like him. You'd expect he'd move on to advantage slots. Maybe not tho because hes now in his 80's.

Although I'm not a slot player, I do keep an eye on some of the slots I've learned are of the "advantage slots" moniker. They seem plentiful compared to the very few vp opportunities still available (with benefits included). At Atlantis and Peppermill, the Bay Area Dragon Ladies run teams through the Reno casinos and they focus on advantage slots. See them all the time, and mgmt. is completely blind to all of it. I'll be at Atlantis a few nights next week on our way to Wyoming to pick up our new puppy, and I expect to see the same old song there regarding the teams. But Im now Black Diamond and they treat us like royalty, even though I mugged the hell out of them and Manarch Black Hawk this summer.

Dancer has been playing advantage slots for the better part of the last two years. He has been mowing up and down the strip playing them. I actually discussed this with Munchkin more than a year ago.

Dancer is retiring at the end of the year unless the tax laws change. And he's made it very clear, if you read his blog, it's specifically because of the tax laws changing.

So either mickey has some insights Dancer does not, or Dancer has some judgement mickey does not. Pick your slot and tax expert.

[Half Smoke]

.
how could the IRS possibly know what the true experience of most winning gamblers really has been over the course of year - ?

totally impossible imo

the only way they could know anything at all is if a W2-G is generated because of a win of a certain size and only on certain types of gambling

what about all of the tens of thousands of other scores of which there is no record - ?

who is going to believe that most winning gamblers are truthful in their reporting to the IRS - ?

I would surmise that it's only a very small % who really are truthful


from google:


"AI Overview


No, casinos generally do not issue Form W2-G for blackjack winnings, regardless of the amount. W2-Gs are typically reserved for games with higher payout ratios and winnings that exceed specific thresholds, such as slot machines, keno, and poker tournaments.

Key information regarding blackjack winnings and taxes

W2-G exemption: Live casino table games, including blackjack, craps, roulette, and baccarat, are exempt from the W2-G reporting requirement. This means the casino will not automatically report your winnings to the IRS."

.

[MisterV]

Starting January 1, 2026, the IRS will limit the deduction of gambling losses to 90% of winnings.

So will the result be that we pretty much ALL will have to pay tax?

Say I won 100K but lost 130K; currently I'd owe nothing, but under the BBB would I be taxed on a phantom 10K?

[smurgerburger]

.
how could the IRS possibly know what the true experience of most winning gamblers really has been over the course of year - ?

totally impossible imo

the only way they could know anything at all is if a W2-G is generated because of a win of a certain size and only on certain types of gambling

what about all of the tens of thousands of other scores of which there is no record - ?

who is going to believe that most winning gamblers are truthful in their reporting to the IRS - ?

I would surmise that it's only a very small % who really are truthful


from google:


"AI Overview


No, casinos generally do not issue Form W2-G for blackjack winnings, regardless of the amount. W2-Gs are typically reserved for games with higher payout ratios and winnings that exceed specific thresholds, such as slot machines, keno, and poker tournaments.

Key information regarding blackjack winnings and taxes

W2-G exemption: Live casino table games, including blackjack, craps, roulette, and baccarat, are exempt from the W2-G reporting requirement. This means the casino will not automatically report your winnings to the IRS."

.

They can't.

Assuming you care to pay taxes on your real net income you would just add ten percent to your declared losses, and nothing in your spending or cash deposits would contradict this.

As far as I can see you should not have problems even in an audit, because you can just not keep gambling logs. If they attempt to reconstruct your income based on your spending and deposits it should be consistent with your actual net income.

And this is assuming you ever get audited which should be extremely rare these days for the amounts of income most professional gamblers might be making.

Anyone with better info feel free to correct me.



Also not that I expect redietz' to be capable of clarifying the point but I don't see why this is any more or less relevant to other forms of AP than it is to sports bettors. Touts of course should not be affected as that is not a form of gambling.

[smurgerburger]

Starting January 1, 2026, the IRS will limit the deduction of gambling losses to 90% of winnings.

So will the result be that we pretty much ALL will have to pay tax?

Say I won 100K but lost 130K; currently I'd owe nothing, but under the BBB would I be taxed on a phantom 10K?

You have misstated it (or I am misremembering). The change is that you can now deduct only 90% of losses against wins. So you don't have the phantom income if your losing sessions exceed your winning sessions by more than 10%.

The phantom income problem sure sounds legally suspect to me but it actually should not affect the vast majority of recreational gamblers, even assuming they are scrupulously reporting.

[redietz]

.
how could the IRS possibly know what the true experience of most winning gamblers really has been over the course of year - ?

totally impossible imo

the only way they could know anything at all is if a W2-G is generated because of a win of a certain size and only on certain types of gambling

what about all of the tens of thousands of other scores of which there is no record - ?

who is going to believe that most winning gamblers are truthful in their reporting to the IRS - ?

I would surmise that it's only a very small % who really are truthful


from google:


"AI Overview


No, casinos generally do not issue Form W2-G for blackjack winnings, regardless of the amount. W2-Gs are typically reserved for games with higher payout ratios and winnings that exceed specific thresholds, such as slot machines, keno, and poker tournaments.

Key information regarding blackjack winnings and taxes

W2-G exemption: Live casino table games, including blackjack, craps, roulette, and baccarat, are exempt from the W2-G reporting requirement. This means the casino will not automatically report your winnings to the IRS."

.

They can't.

Assuming you care to pay taxes on your real net income you would just add ten percent to your losses, and nothing in your spending or cash deposits would contradict this.

As far as I can see you should not have problems even in an audit, because you can just not keep gambling logs. If they attempt to reconstruct your income based on your spending and deposits it should be consistent with your actual net income.

And this is assuming you ever get audited which should be extremely rare these days for the amounts of income most professional gamblers might be making.

Anyone with better info feel free to correct me.



Also not that I expect redietz' to be capable of clarifying the point but I don't see why this is any more or less relevant to other forms of AP than it is to sports bettors. Touts of course should not be affected as that is not a form of gambling.

Well, smurger, the answer to your question is really very obvious, so I'll give you the benefit of the doubt and figure you, as most here do, typed before rubbing a couple neurons together. Let's see how many seconds it takes for the obvious to occur to you.

And just so I can put a cherry on top, I already explained this in a previous post. To paraphrase the Geico caveman ads, it's so obvious even a VCT "AP" can figure it out.

In other words, are you guys really this dumb, or do you just pretend to be low IQ?

[jdaewoo]

This retard honestly thinks he's sharp.

[accountinquestion]

This retard honestly thinks he's sharp.

No, because he's too smart to use the word sharp.

[DGenBen]

.
how could the IRS possibly know what the true experience of most winning gamblers really has been over the course of year - ?

totally impossible imo

the only way they could know anything at all is if a W2-G is generated because of a win of a certain size and only on certain types of gambling

what about all of the tens of thousands of other scores of which there is no record - ?

who is going to believe that most winning gamblers are truthful in their reporting to the IRS - ?

I would surmise that it's only a very small % who really are truthful


from google:


"AI Overview


No, casinos generally do not issue Form W2-G for blackjack winnings, regardless of the amount. W2-Gs are typically reserved for games with higher payout ratios and winnings that exceed specific thresholds, such as slot machines, keno, and poker tournaments.

Key information regarding blackjack winnings and taxes

W2-G exemption: Live casino table games, including blackjack, craps, roulette, and baccarat, are exempt from the W2-G reporting requirement. This means the casino will not automatically report your winnings to the IRS."

.

They can't.

Assuming you care to pay taxes on your real net income you would just add ten percent to your losses, and nothing in your spending or cash deposits would contradict this.

As far as I can see you should not have problems even in an audit, because you can just not keep gambling logs. If they attempt to reconstruct your income based on your spending and deposits it should be consistent with your actual net income.

And this is assuming you ever get audited which should be extremely rare these days for the amounts of income most professional gamblers might be making.

Anyone with better info feel free to correct me.



Also not that I expect redietz' to be capable of clarifying the point but I don't see why this is any more or less relevant to other forms of AP than it is to sports bettors. Touts of course should not be affected as that is not a form of gambling.

Well, smurger, the answer to your question is really very obvious, so I'll give you the benefit of the doubt and figure you, as most here do, typed before rubbing a couple neurons together. Let's see how many seconds it takes for the obvious to occur to you.

And just so I can put a cherry on top, I already explained this in a previous post. To paraphrase the Geico caveman ads, it's so obvious even a VCT "AP" can figure it out.

In other words, are you guys really this dumb, or do you just pretend to be low IQ?

Well I know exactly what you are referring to, but the counterpoint to your argument is so obvious that if it were a snake it would have jumped up and bit you.

Do you see it yet?

[accountinquestion]

They can't.

Assuming you care to pay taxes on your real net income you would just add ten percent to your losses, and nothing in your spending or cash deposits would contradict this.

As far as I can see you should not have problems even in an audit, because you can just not keep gambling logs. If they attempt to reconstruct your income based on your spending and deposits it should be consistent with your actual net income.

And this is assuming you ever get audited which should be extremely rare these days for the amounts of income most professional gamblers might be making.

Anyone with better info feel free to correct me.



Also not that I expect redietz' to be capable of clarifying the point but I don't see why this is any more or less relevant to other forms of AP than it is to sports bettors. Touts of course should not be affected as that is not a form of gambling.

Well, smurger, the answer to your question is really very obvious, so I'll give you the benefit of the doubt and figure you, as most here do, typed before rubbing a couple neurons together. Let's see how many seconds it takes for the obvious to occur to you.

And just so I can put a cherry on top, I already explained this in a previous post. To paraphrase the Geico caveman ads, it's so obvious even a VCT "AP" can figure it out.

In other words, are you guys really this dumb, or do you just pretend to be low IQ?

Well I know exactly what you are referring to, but the counterpoint to your argument is so obvious that if it were a snake it would have jumped up and bit you.

Do you see it yet?

Took me a bit to see it but no way Redietz sees it.

[theywontpayontuesday]

This gambling tax will send some of you sold into the sex trafficking rings. Ironically probably going to be you know who you know the what fuck nuts?

[AxelWolf]

Offshore should boom.

[mickeycrimm]

Dancer is retiring at the end of the year unless the tax laws change. And he's made it very clear, if you read his blog, it's specifically because of the tax laws changing. So either mickey has some insights Dancer does not, or Dancer has some judgement mickey does not. Pick your slot and tax expert.

if you read his blog you would know that Dancer is pretty frail these days. He’s recently written about times he used both power chairs and walkers. He’s also mentioned that it takes a lot of walking to work the advantage slots. Thats something I know a lot about.

The exploitable machines are spread out in the casinos. And just because you make it to a machine doesn’t mean you will get a play. There is a lot of zig zagging around involved, and trips to the restrooms. A young healthy slot hustler making a few laps a day around the advantage machines mid-strip will probably walk 15 miles a day. So how well can a 78 year old man do it?

I just returned from 8 days spent mid strip, 4 days south strip, 4 days downtown, 2 days Laughlin so I’ve seen the territory he works. And I seen the competition he faces from younger slot hustlers. I enjoyed the trip, and I will return. But not for the money. There are better spots for me in this country than the strip. If Bob quits video poker its because his edge is to thin to overcome the new tax law. If he quits advantage slots its because its to much work for him/he’s out competed.

[redietz]

Dancer is retiring at the end of the year unless the tax laws change. And he's made it very clear, if you read his blog, it's specifically because of the tax laws changing. So either mickey has some insights Dancer does not, or Dancer has some judgement mickey does not. Pick your slot and tax expert.

if you read his blog you would know that Dancer is pretty frail these days. He’s recently written about times he used both power chairs and walkers. He’s also mentioned that it takes a lot of walking to work the advantage slots. Thats something I know a lot about.

The exploitable machines are spread out in the casinos. And just because you make it to a machine doesn’t mean you will get a play. There is a lot of zig zagging around involved, and trips to the restrooms. A young healthy slot hustler making a few laps a day around the advantage machines mid-strip will probably walk 15 miles a day. So how well can a 78 year old man do it?

I just returned from 8 days spent mid strip, 4 days south strip, 4 days downtown, 2 days Laughlin so I’ve seen the territory he works. And I seen the competition he faces from younger slot hustlers. I enjoyed the trip, and I will return. But not for the money. There are better spots for me in this country than the strip. If Bob quits video poker its because his edge is to thin to overcome the new tax law. If he quits advantage slots its because its to much work for him/he’s out competed.

Well, as of a year ago, he was definitely not "frail," whatever that means. He was actually pounding the strip pavement. Now granted, doing that when it's 105 is probably too taxing in the long run for someone his (and your and my) age, but I would not describe him as "frail." If he's "frail," you and I are decrepit.

[mickeycrimm]

Dancer is retiring at the end of the year unless the tax laws change. And he's made it very clear, if you read his blog, it's specifically because of the tax laws changing. So either mickey has some insights Dancer does not, or Dancer has some judgement mickey does not. Pick your slot and tax expert.

if you read his blog you would know that Dancer is pretty frail these days. He’s recently written about times he used both power chairs and walkers. He’s also mentioned that it takes a lot of walking to work the advantage slots. Thats something I know a lot about.

The exploitable machines are spread out in the casinos. And just because you make it to a machine doesn’t mean you will get a play. There is a lot of zig zagging around involved, and trips to the restrooms. A young healthy slot hustler making a few laps a day around the advantage machines mid-strip will probably walk 15 miles a day. So how well can a 78 year old man do it?

I just returned from 8 days spent mid strip, 4 days south strip, 4 days downtown, 2 days Laughlin so I’ve seen the territory he works. And I seen the competition he faces from younger slot hustlers. I enjoyed the trip, and I will return. But not for the money. There are better spots for me in this country than the strip. If Bob quits video poker its because his edge is to thin to overcome the new tax law. If he quits advantage slots its because its to much work for him/he’s out competed.

Well, as of a year ago, he was definitely not "frail," whatever that means. He was actually pounding the strip pavement. Now granted, doing that when it's 105 is probably too taxing in the long run for someone his (and your and my) age, but I would not describe him as "frail." If he's "frail," you and I are decrepit.

You must not have read about him and Bonnie sharing a power chair at Cherokee. He also has written about using a walker. So do you really think he can speed walk the casinos like the young hustlers do? With a walker?

[accountinquestion]

Dancer is retiring at the end of the year unless the tax laws change. And he's made it very clear, if you read his blog, it's specifically because of the tax laws changing. So either mickey has some insights Dancer does not, or Dancer has some judgement mickey does not. Pick your slot and tax expert.

if you read his blog you would know that Dancer is pretty frail these days. He’s recently written about times he used both power chairs and walkers. He’s also mentioned that it takes a lot of walking to work the advantage slots. Thats something I know a lot about.

The exploitable machines are spread out in the casinos. And just because you make it to a machine doesn’t mean you will get a play. There is a lot of zig zagging around involved, and trips to the restrooms. A young healthy slot hustler making a few laps a day around the advantage machines mid-strip will probably walk 15 miles a day. So how well can a 78 year old man do it?

I just returned from 8 days spent mid strip, 4 days south strip, 4 days downtown, 2 days Laughlin so I’ve seen the territory he works. And I seen the competition he faces from younger slot hustlers. I enjoyed the trip, and I will return. But not for the money. There are better spots for me in this country than the strip. If Bob quits video poker its because his edge is to thin to overcome the new tax law. If he quits advantage slots its because its to much work for him/he’s out competed.

I know you can't read this but you're single and it isn't the money then why return to the strip? Just cheap rooms? I despise staying on the strip. The relentless nickel and diming wears on me even though rooms are cheap.

[DGenBen]

Dancer is retiring at the end of the year unless the tax laws change. And he's made it very clear, if you read his blog, it's specifically because of the tax laws changing. So either mickey has some insights Dancer does not, or Dancer has some judgement mickey does not. Pick your slot and tax expert.

if you read his blog you would know that Dancer is pretty frail these days. He’s recently written about times he used both power chairs and walkers. He’s also mentioned that it takes a lot of walking to work the advantage slots. Thats something I know a lot about.

The exploitable machines are spread out in the casinos. And just because you make it to a machine doesn’t mean you will get a play. There is a lot of zig zagging around involved, and trips to the restrooms. A young healthy slot hustler making a few laps a day around the advantage machines mid-strip will probably walk 15 miles a day. So how well can a 78 year old man do it?

I just returned from 8 days spent mid strip, 4 days south strip, 4 days downtown, 2 days Laughlin so I’ve seen the territory he works. And I seen the competition he faces from younger slot hustlers. I enjoyed the trip, and I will return. But not for the money. There are better spots for me in this country than the strip. If Bob quits video poker its because his edge is to thin to overcome the new tax law. If he quits advantage slots its because its to much work for him/he’s out competed.

I know you can't read this but you're single and it isn't the money then why return to the strip? Just cheap rooms? I despise staying on the strip. The relentless nickel and diming wears on me even though rooms are cheap.

I think the appeal for slots players is the variety and the volume of machines.

I agree with you though. The nickel & diming, the endless walks from casino to casino, the hassle & the crowds.

But I can see how it would appeal to other people with the excitement & the variety especially if you are mainly working in rural areas.

Not to mention the view of all the lovely ladies. Or I guess depending on some people's tastes the dudes.

It appealed to me for a long time too, but I’m too old now to care lol.

[Dan Druff]

Funny, I hadn't seen this thread started by Mickey at 6:30am yesterday, and I started my own thread on X about 3 hours ago:

Embedded Tweet

https://twitter.com/#!/x/status/1977258379686076913



Anyway, I completely disagree with Mickey. The pro gambling/poker/sportsbetting world as we know it isn't going to end on 1/1/26.

There are many reasons for this:

1) APs are actually the least susceptible to this, as their wins/losses are self-reported. Casino records on APs are meaningless, since APs often use multiple cards or no card at all. Even when they do use their own cards, they will often pull shenanigans to falsely generate losses. None of this is illegal, either (though some Indian tribes may treat it that way!) Anyway, I can guarantee you that almost every AP fudges their wins for tax reasons, knowing that no records exist to counter them. When I suggested this a few months ago on X, some APs got very mad at me, clutching their pearls and insisting they are honest as Abe Lincoln when it comes to taxes. All I can say is bullshit. People who deceive casinos for a living are not likely to be salt-of-the-earth honest when it comes to their taxes. Therefore, they just need to fudge an additional 11% (which is easy) in order to negate this new law.

2) Poker cash game players also self-report their numbers, and similar to what I stated about APs above, they can just fudge an additional 11% to negate this. I personally know a ton of poker cash players who have admitted to me that they do not accurately report their wins to the IRS. (Obviously I'm not naming them!)

3) Poker tournament players could have an issue, as all of their live tournaments create a paper trail regarding their results. However, if these tournament players play cash games or gamble on other things, they can do that same 11% fudging. My guess is that some will do this fudging, and some won't. However, note that this only affects poker tournament players who itemize their taxes and either lose less than 11% for the year, or win.

4) Sportsbettors could have an issue, but only ones who bet exclusively at books which keep records and submit them to the IRS. Most pro sportsbettors have offshore books which they can use to fudge numbers if they want.


Note that I am not referring to myself here. I'm talking about what gamblers in each community have done and will do, based upon extensive private conversations I've had with people about the subject over the years.

The bottom line is that most people either won't be affected, or will fudge numbers in order to negate the tax increase. The few who are affected and either can't or won't fudge numbers will just end up paying higher taxes. However, this will not decimate any of the gambling communities.

You'll see... a year from now, everything will be similar to today, despite this new law.