Will they adjust pay tables in 2026?

[Don Perignom]

5) Casino advantage players will definitely not be affected. There is no reliable tracking of their wins and losses, as they typically play on multiple players cards (many not in their own names), as well as often with no card at all. Their wins/losses on their taxes are completely self-reported and unverifiable beyond a very rough number. I can assure you that very few casino APs report their actual winnings to the IRS. Most report a number they feel they can get away with defending if audited. So these people will just tack on another 11% of losses, and the new law will be negated. There will be no proof they did this, in most cases.

Just lie harder and you probably won't get caught. Insightful analysis.

Not sure if mentioned (or true), but the way I caught it, Congress has a "reconciliation" procedure that allows them to approve stuff with a simple majority. But it has to be revenue-neutral, so when they add a spend, they have to "pay for it." In this case, they grasped at the 90% restriction to offset something else.

In my view, this sets the stage for further cuts (to 80 or 70%) the next time they're out of balance.

[DGenBen]

Another post from 2+2...

----

Furthermore, as I mentioned before, there's the matter of enforcement.

I've been thinking about something. WHY was this law passed? WHY were they limiting 90% of losses against wins? How did anyone think this was fair?

We will likely never know the answer to this, but I'm guessing the discussion went something like, "Those professional gamblers, they've been getting away with underpaying their taxes for decades. They self-report and all of them are shaving off winnings! It's not fair to the rest of American taxpayers!" Then someone responded, "I know! Since all of them have to be cheating by at least 10%, let's just chop 10% off whatever losses they want to deduct! That will make it more equitable!"

Then these dummies didn't think about all of the negative side effects to this, most importantly the "phantom income" problem.

What's my point?

The IRS is never going to haul in a high volume grinder who clearly made no more than $200k in poker, and demand he pay taxes on a fake income of $1.18m, thus making his tax rate something like 300%. This would be a horrible look, and an embarrassment to the IRS and its top brass, and the media would eat it up.

I cannot see a realistic scenario where such a grinder would be brought into an audit and told to pay $600k taxes on $200k income, even if the law technically allows for that to happen. Much like they could be auditing the gambling community like crazy (and indeed would catch a lot of tax cheats), but they have been barely auditing gamblers at all, going back decades.

Actually, and I’m too lazy to try to dig up the article, but back when this happened there was a reason given.

I may have some details wrong since I’m doing it from memory but essentially the reason they capped it at 90% was really a technicality.

With all the changes they made to the revenue & expenditures in the B.B. Bill they had to go through a reconciliation process & there was a requirement that certain lost revenue had to be made up somewhere.

So knocking the gambling loss write off down to 90% makes it appear as tax revenue will increase by $10 Billion over a 10 year period and they needed that for the bill to pass through the reconciliation process.

Again may have some details wrong but that was the gist of it.

Also, not mentioned in the article but obviously targeting a small generally unsympathetic group without any lobby like gamblers (casinos have strong lobbies but gamblers do not) is a savvy political move.

Edit: Just saw your earlier post Don Perignom. Yes we both remember it the same way.

[mickeycrimm]

Here’s what the expectation looks like to me, at least with the thin edge video poker, with the new tax law in mind. Say I play $50 per hand 9/6 Jacks video poker with a 2% edge. I get W2G’s for RF, SF, 4K. I play 200,000 hands in the year, easily done, and hit the expectation perfectly. The wager would be $10,000,000. The profit would be $200,000. This play would average about 840K in W2G’s per year.

Easy enough to calculate the total of winning sessions and the total of losing sessions. Winning sessions total to $5,100,000 and losing sessions total to $4,900,000. Hence the 200K profit.

Note the profit is about 25% of the W2G’s. This is the typical range for a high stakes professional video poker player. The smaller the edge the lower the percentage will be.

Before new law would pay tax on 200K. But with new tax law can write off only 90% of 4.9 million, which is $4,410,000. The difference between 5.1 million and 4.41 million is $690,000.

So you won 200K but owe taxes on 690K.

This is what it looks like to me. And I think this is why Bob Dancer announced his retirement.

[Rob.Singer]

Here’s what the expectation looks like to me, at least with the thin edge video poker, with the new tax law in mind. Say I play $50 per hand 9/6 Jacks video poker with a 2% edge. I get W2G’s for RF, SF, 4K. I play 200,000 hands in the year, easily done, and hit the expectation perfectly. The wager would be $10,000,000. The profit would be $200,000. This play would average about 840K in W2G’s per year.

Easy enough to calculate the total of winning sessions and the total of losing sessions. Winning sessions total to $5,100,000 and losing sessions total to $4,900,000. Hence the 200K profit.

Note the profit is about 25% of the W2G’s. This is the typical range for a high stakes professional video poker player. The smaller the edge the lower the percentage will be.

Before new law would pay tax on 200K. But with new tax law can write off only 90% of 4.9 million, which is $4,410,000. The difference between 5.1 million and 4.41 million is $690,000.

So you won 200K but owe taxes on 690K.

This is what it looks like to me. And I think this is why Bob Dancer announced his retirement.

I assume this scenario refers to a pro gambler filing Schedule C. Lots of write-offs to consider, which come directly out of income. IRS allows many creative ways where this is concerned. And above, are you saying there were over $4mil in winning sessions without any signers?

I had a single year and then a multi-year audit when I filed as a professional gambler 2000-2009. Maybe it's different now, but I got nowhere trying to tell their auditors that W2G's do not = profit. The first audit zeroed out; in the multi-year audit they somehow spent 5 months analyzing my filings & support, and then they sent me a check for $800. I've never been able to figure out how or why.

I can see why Dancer might want very little to do with this now. At a younger age, I'll bet he would be challenging all the nonsensical stuff we now face. IRS auditors already aren't the sharpest tools in the shed.

[mickeycrimm]

Here’s what the expectation looks like to me, at least with the thin edge video poker, with the new tax law in mind. Say I play $50 per hand 9/6 Jacks video poker with a 2% edge. I get W2G’s for RF, SF, 4K. I play 200,000 hands in the year, easily done, and hit the expectation perfectly. The wager would be $10,000,000. The profit would be $200,000. This play would average about 840K in W2G’s per year.

Easy enough to calculate the total of winning sessions and the total of losing sessions. Winning sessions total to $5,100,000 and losing sessions total to $4,900,000. Hence the 200K profit.

Note the profit is about 25% of the W2G’s. This is the typical range for a high stakes professional video poker player. The smaller the edge the lower the percentage will be.

Before new law would pay tax on 200K. But with new tax law can write off only 90% of 4.9 million, which is $4,410,000. The difference between 5.1 million and 4.41 million is $690,000.

So you won 200K but owe taxes on 690K.

This is what it looks like to me. And I think this is why Bob Dancer announced his retirement.

I assume this scenario refers to a pro gambler filing Schedule C. Lots of write-offs to consider, which come directly out of income. IRS allows many creative ways where this is concerned. And above, are you saying there were over $4mil in winning sessions without any signers?

I had a single year and then a multi-year audit when I filed as a professional gambler 2000-2009. Maybe it's different now, but I got nowhere trying to tell their auditors that W2G's do not = profit. The first audit zeroed out; in the multi-year audit they somehow spent 5 months analyzing my filings & support, and then they sent me a check for $800. I've never been able to figure out how or why.

I can see why Dancer might want very little to do with this now. At a younger age, I'll bet he would be challenging all the nonsensical stuff we now face. IRS auditors already aren't the sharpest tools in the shed.

I’m just doing a cost benefit analysis so speculating. There would be a lot of signers here. The expectation is about 5 for royals, about 20 for straight flushes, and about 470 for 4 of a Kinds.

Playing 200,000 hands with a four of a kind frequency of 425 is going to produce about 470 signers. That’s assuming the quads pay at least 25 for 1 which would be $1250.

[accountinquestion]

Another post from 2+2...

----

Furthermore, as I mentioned before, there's the matter of enforcement.

I've been thinking about something. WHY was this law passed? WHY were they limiting 90% of losses against wins? How did anyone think this was fair?

We will likely never know the answer to this, but I'm guessing the discussion went something like, "Those professional gamblers, they've been getting away with underpaying their taxes for decades. They self-report and all of them are shaving off winnings! It's not fair to the rest of American taxpayers!" Then someone responded, "I know! Since all of them have to be cheating by at least 10%, let's just chop 10% off whatever losses they want to deduct! That will make it more equitable!"

Then these dummies didn't think about all of the negative side effects to this, most importantly the "phantom income" problem.

What's my point?

The IRS is never going to haul in a high volume grinder who clearly made no more than $200k in poker, and demand he pay taxes on a fake income of $1.18m, thus making his tax rate something like 300%. This would be a horrible look, and an embarrassment to the IRS and its top brass, and the media would eat it up.

I cannot see a realistic scenario where such a grinder would be brought into an audit and told to pay $600k taxes on $200k income, even if the law technically allows for that to happen. Much like they could be auditing the gambling community like crazy (and indeed would catch a lot of tax cheats), but they have been barely auditing gamblers at all, going back decades.

I think Crapo, typical politician, was just looking for a way to raise more tax revenue. I think it was estimated to be about 1 billion.

It is a sin tax of sorts. Whenever tax authorities can tax sins/vices they are first in line.

[Dan Druff]

5) Casino advantage players will definitely not be affected. There is no reliable tracking of their wins and losses, as they typically play on multiple players cards (many not in their own names), as well as often with no card at all. Their wins/losses on their taxes are completely self-reported and unverifiable beyond a very rough number. I can assure you that very few casino APs report their actual winnings to the IRS. Most report a number they feel they can get away with defending if audited. So these people will just tack on another 11% of losses, and the new law will be negated. There will be no proof they did this, in most cases.

Just lie harder and you probably won't get caught. Insightful analysis.

What do you think is the most likely scenario?

1) APs (who have little-to-no paper trail following them) will just increase reported "losses" by 11% to offset this new law
-or-
2) APs suddenly pay their taxes completely honestly for the first time in recorded history
-or-
3) APs throw in the towel and quit, because lying about another 11% in losses is a bridge they're not willing to cross



I'm being realistic here. I am not defending the law, but I'm telling you what is going to happen, and I'm sure you know I'm right.

[Dan Druff]

With all the changes they made to the revenue & expenditures in the B.B. Bill they had to go through a reconciliation process & there was a requirement that certain lost revenue had to be made up somewhere.

So knocking the gambling loss write off down to 90% makes it appear as tax revenue will increase by $10 Billion over a 10 year period and they needed that for the bill to pass through the reconciliation process.

Again may have some details wrong but that was the gist of it.

Also, not mentioned in the article but obviously targeting a small generally unsympathetic group without any lobby like gamblers (casinos have strong lobbies but gamblers do not) is a savvy political move.

If that's true, it's dumber than I thought.

I was giving them too much credit.

They're barely going to get any additional revenue from this. It might actually decrease revenue if people panic and stop professionally gambling over the fear of this new tax situation.


But I guess it's not surprising, because even state regulators don't understand the gambling community well, so how can we expect Congress to understand?

[Dan Druff]

Here’s what the expectation looks like to me, at least with the thin edge video poker, with the new tax law in mind. Say I play $50 per hand 9/6 Jacks video poker with a 2% edge. I get W2G’s for RF, SF, 4K. I play 200,000 hands in the year, easily done, and hit the expectation perfectly. The wager would be $10,000,000. The profit would be $200,000. This play would average about 840K in W2G’s per year.

Easy enough to calculate the total of winning sessions and the total of losing sessions. Winning sessions total to $5,100,000 and losing sessions total to $4,900,000. Hence the 200K profit.

Note the profit is about 25% of the W2G’s. This is the typical range for a high stakes professional video poker player. The smaller the edge the lower the percentage will be.

Before new law would pay tax on 200K. But with new tax law can write off only 90% of 4.9 million, which is $4,410,000. The difference between 5.1 million and 4.41 million is $690,000.

So you won 200K but owe taxes on 690K.

This is what it looks like to me. And I think this is why Bob Dancer announced his retirement.

So let's stop discussing theory here, and get into realistic expectations.

If the above happened to you, what would you do? Send the IRS $690k on a $200k income?

Seriously... what would you do?

I think we both know what you would do. You would pad losing sessions to where the $4.9m in losses becomes something like $5.5m in losses, and you'd then show an income of $150k and pay taxes on that.

You don't have to say YOU would do this, in case the IRS is reading this. But let's instead discuss what "Joe Advantage Player" would do in this spot.

Bob Dancer is retiring because he's 78 years old and probably tired.

[DGenBen]

With all the changes they made to the revenue & expenditures in the B.B. Bill they had to go through a reconciliation process & there was a requirement that certain lost revenue had to be made up somewhere.

So knocking the gambling loss write off down to 90% makes it appear as tax revenue will increase by $10 Billion over a 10 year period and they needed that for the bill to pass through the reconciliation process.

Again may have some details wrong but that was the gist of it.

Also, not mentioned in the article but obviously targeting a small generally unsympathetic group without any lobby like gamblers (casinos have strong lobbies but gamblers do not) is a savvy political move.

If that's true, it's dumber than I thought.

I was giving them too much credit.

They're barely going to get any additional revenue from this. It might actually decrease revenue if people panic and stop professionally gambling over the fear of this new tax situation.


But I guess it's not surprising, because even state regulators don't understand the gambling community well, so how can we expect Congress to understand?

Agreed.

It will likely push honest people to either stop gambling or stop reporting income honestly.

People who are already underreporting will probably just increase the amount they are underreporting to offset.

A stupid change where the most likely result is to decrease tax revenue.

[mickeycrimm]

Here’s what the expectation looks like to me, at least with the thin edge video poker, with the new tax law in mind. Say I play $50 per hand 9/6 Jacks video poker with a 2% edge. I get W2G’s for RF, SF, 4K. I play 200,000 hands in the year, easily done, and hit the expectation perfectly. The wager would be $10,000,000. The profit would be $200,000. This play would average about 840K in W2G’s per year.

Easy enough to calculate the total of winning sessions and the total of losing sessions. Winning sessions total to $5,100,000 and losing sessions total to $4,900,000. Hence the 200K profit.

Note the profit is about 25% of the W2G’s. This is the typical range for a high stakes professional video poker player. The smaller the edge the lower the percentage will be.

Before new law would pay tax on 200K. But with new tax law can write off only 90% of 4.9 million, which is $4,410,000. The difference between 5.1 million and 4.41 million is $690,000.

So you won 200K but owe taxes on 690K.

This is what it looks like to me. And I think this is why Bob Dancer announced his retirement.

So let's stop discussing theory here, and get into realistic expectations.

If the above happened to you, what would you do? Send the IRS $690k on a $200k income?

Seriously... what would you do?

I think we both know what you would do. You would pad losing sessions to where the $4.9m in losses becomes something like $5.5m in losses, and you'd then show an income of $150k and pay taxes on that.

You don't have to say YOU would do this, in case the IRS is reading this. But let's instead discuss what "Joe Advantage Player" would do in this spot.

Bob Dancer is retiring because he's 78 years old and probably tired.

You wouldn’t pay 690K on 200K in income. You would pay tax on 690K instead of 200K.

And instead of paying 32% on 200K you would pay 35% on 690K. In essence, the IRS would take all the winnings.

It gets worse as the edge gets thinner. In this case it is a 10 million dollar wager. Imagine having to run a 20 million dollar wager to make the same 200K.

But I get your point. The percentage of gamblers that don’t use a “creative pencil” on their taxes is somewhere between slim and none. It’s just to easy to jimmy the books in most situations.

There was a winning LA poker player that made the news in the poker world back in the 90’s. An IRS audit showed that just his house payments were more than his declared income. So, pencilers, don’t get caught in that trap. You have to show enough income to cover your expenses.

My analysis here is not really theory. It’s a projection using perfect numbers to determine if one wants to get involved. I’ve done it many times over the years usually when evaluating two current plays to determine which one I should go to.

[Don Perignom]

I'm being realistic here. I am not defending the law, but I'm telling you what is going to happen, and I'm sure you know I'm right.

You seem intent on having a "hot take." If we assume everyone takes the course of lying harder, there's still the problem of elevated risk because now the potential consequences are more severe. Most prudent people attempt to manage risk. They insure their house, even though it probably won't burn down. You can't buy insurance against tax fraud.

A stupid change where the most likely result is to decrease tax revenue.

As discussed, they weren't necessarily trying to increase revenue. They merely wanted the appearance of increasing revenue, so they could push their pork spending through.

[mickeycrimm]

Bob Dancer is retiring because he's 78 years old and probably tired.

Dancer and Munchkin interviewed noted gambling tax expert, Russel Fox, on GWAE on July 15, 2025. Dancer followed up with a blog about it on July 29, 2025. Here are some quotes:

"The new provisions have little effect on recreational gamblers but are career endingly serious for professional gamblers."

"I'm both planning on exploiting the games i find for the last five months of the year, and planning on what I'm going to do with the rest of my life."

""And, of course, I will hope the law gets changed soon. If it does, I plan to be ready to go in 2026...."

Dancer stated that he gets millions of dollars of W2G's per year because he plays high stakes. And he plays very small edges. He has no compunction about throwing down on a .25% edge. He talked about getting 6 million in W2G's in 2023 and losing 150K, and getting another 6 million in 2024 and winning 200K. If the new tax law were in effect then he would owe nothing for 2023 but would be on the hook to pay taxes on 600K in phantom income in 2024.

The problem with video poker is it's thin edge, you run a huge wager, and the way the games are structured you get lots of W2G's.

[mickeycrimm]

About 20 years ago I was on a video poker play in Ely, Nevada. Also there was a VP pro who was famous in the VP world. On discussion of taxes he told me he showed a profit on his tax returns of around 15% the amount of his W2G's. He said that was standard at the time. The edges he played were around 1% to 2%.

And in his LVA July 29 article Dancer told of 12 million dollars in W2G's over a two year period that produced a profit of just 50K. The profit would be just half percent of total W2G's.

The above two examples are untenable under the new law. You just can't throw down on thin edge plays anymore.

But that's not the scenario for a lot of Slot AP's, myself included. For slot AP's, what is the amount of profit compared to the amount of W2G's? It's a variable. If one plays low enough there are no W2G's involved, but then one is restricted as to the amount of money they can make.

I think middle class slot AP's that play many different short term slot advantages and make 100K to 200K a year can attest to this. The profit can be 150% or 200% of the amount of W2G's they acquire. There's a reason for this.

In video poker the royals are the paydays. In other words, top line hits. Not so in slot AP. A slot AP can go days, even weeks without a top line hit/W2G and still show a profit everyday. The reason is because of the big edges involved. When you are playing with 10% or 20% edges it's hard to have a losing day when you are running at least few thousand dollars a day wager with the bet levels being no more than $5 or $6 a spin. The top line hits generally represent no more than a few percent of the games payback. So you make a decent profit without those hits.

The difference between what vulture type slot AP's do and what video poker pros do is a slot AP's profit amounts to 150% or higher of their total W2G's, wheres a video poker pro's profit amounts to 15% or less of their total W2G's.

The new tax law puts the thin edgers out of business, that is, unless they want to fudge the books. But the new law may actually be better for slot AP's. I'll get to that in a later post.

[Dan Druff]

I'm being realistic here. I am not defending the law, but I'm telling you what is going to happen, and I'm sure you know I'm right.

You seem intent on having a "hot take." If we assume everyone takes the course of lying harder, there's still the problem of elevated risk because now the potential consequences are more severe. Most prudent people attempt to manage risk. They insure their house, even though it probably won't burn down. You can't buy insurance against tax fraud.

I'm not trying to have a hot take. Who would I be trying to impress here?

I'm giving you a realistic take. I know poker players, I know sportsbettors, I know APs.

All of this group will continue forward, with only a few exceptions, likely people who were planning upon leaving the game anyway.

Of these communities, the APs will be least effective. They simply do not have a reliable paper trail. At the end of the day, the IRS can only make sense of the assets they appear to have and the assets they declared. Everything else is opaque, and there's no way to re-create it.

Joe the AP lying about another 11% of losses is not going to make-or-break whether they get audited or criminally charged. It's negligible as far as the yearlong picture of an AP. They can spin a million (unverifiable, but impossible to disprove) tales to explain all of this away.

Remember, the IRS doesn't care if you multi-card, use disguises, dodge bans, no-card, collect others' freeplay, etc. They just want their share of your actual income. How you get there is unimportant to them, as long as it appears you're roughly telling the truth. Another 11% padded onto losses definitely fits into "roughly".

Picture this:

You're 11 years old on Halloween. You have a big bag of candy. Your mom tells you that you're not allowed to have more than 5 pieces of candy, but you eat 6. Out of hundreds of pieces of candy in the bag, your mom is never going to be able to tell whether you had 5 or 6 (let's ignore the empty wrapper situation -- maybe it's trash day). However, if your mom comes upstairs and half the bag is empty, she's probably taking it away at that point and grounding you.

The AP adjusting their bullshit by 11% is like eating 6 pieces of candy instead of 5. There's no way to tell.

There's also the matter that only a tiny percentage of pro gamblers get audited, and the ones that do tend to be the egregious offenders -- the non-filers, the way-under-declarers, etc.

There is no provision in the new law to audit gamblers more often, and in fact the IRS is presently more backed up than ever.



But if you're looking to scream "The sky is falling!" and get attention on social media, as well as plaudits for "joining the fight", now is a great time to do so. Just make a big angry post about how it's UNFAIR and THIS MUST BE STOPPED and WE MUST GET DINA TITUS' FAIR ACT PASSED, CALL YOUR CONGRESSMAN, and you can be one of the cool kids.

[Dan Druff]

Bob Dancer is retiring because he's 78 years old and probably tired.

Dancer and Munchkin interviewed noted gambling tax expert, Russel Fox, on GWAE on July 15, 2025. Dancer followed up with a blog about it on July 29, 2025. Here are some quotes:

"The new provisions have little effect on recreational gamblers but are career endingly serious for professional gamblers."

"I'm both planning on exploiting the games i find for the last five months of the year, and planning on what I'm going to do with the rest of my life."

""And, of course, I will hope the law gets changed soon. If it does, I plan to be ready to go in 2026...."

Dancer stated that he gets millions of dollars of W2G's per year because he plays high stakes. And he plays very small edges. He has no compunction about throwing down on a .25% edge. He talked about getting 6 million in W2G's in 2023 and losing 150K, and getting another 6 million in 2024 and winning 200K. If the new tax law were in effect then he would owe nothing for 2023 but would be on the hook to pay taxes on 600K in phantom income in 2024.

The problem with video poker is it's thin edge, you run a huge wager, and the way the games are structured you get lots of W2G's.

I covered this on my show in July. Not Russ Fox or GWAE specifically, but the reason accountants are not the best people to ask about this.

Why? Because they are professionals who have to follow the law to the letter, and in fact are expected to know far more than the average filer. If they play fast and loose with the rules, it can be their head on the stick.

So you're never going to have a guy like Russ Fox saying, "The IRS is never coming after the breakeven gambler who fails to pay taxes on phantom winnings", nor is he going to say, "The truth is that most gamblers will just pad their losses to counteract this", because that looks terrible for a professional to say.

This remidns me a bit of my last root canal.

Yes, a root canal... stick with me here.

Since the 2000s, they started putting this obnoxious rubber piece over your mouth called a "dental dam". It literally makes it impossible to breathe through your mouth, which as you can imagine, is quite unnerving for many patients.




Imagine having that covering your mouth for 90 minutes. Or maybe you don't have to imagine, if you've had a root canal in the past 20 or so years, like I have.

I found this beyond uncomfortable, so I asked the endodontist if he could take it off. He insisted the dental dam was very important to keep things "clean and sanitary" in the area of the exposed root, and therefore could not remove it. After I continued objecting, he compromised by cutting half of it off. Still unpleasant, but I dealt with it.

The next time I needed a root canal, I researched this dental dam beforehand. I learned some interesting things. It turns out that this is "safety overkill" -- where the desire for a little extra safety from infection is causing patients a lot of distress. In one study, it was found that some patients elected to have a tooth pulled rather than save it, simply to avoid the dental dam. It was found that others suffering from anxiety or claustrophobia had psychological damage from having to tolerate this for 90 minutes. It was found that those with deviated septums -- ones who can't easily breathe through their nose -- had an extremely hard time with it, and again, endured psychological trauma. The study concluded that the small gain in infection prevention was not worth the psychological side effects it brought to many patients, nor was it better for overall dental hygiene for patients to be choosing to skip root canals entirely, solely because of the dental dam. The study urged endodontists to make it optional.

Unfortunately, even though I was convinced, this never caught on. To this day, endodontists demand it. When I called around for my next root canal, every single endodontist said it was non-negotiable, and in fact some wouldn't even cut half of it off.

Finally, one endodontist leveled with me.

"You're not going to find one who will allow you to skip it. It's considered part of our best practices. This is our specialty. If we cut corners like this, it could severely impact our reputation, as well as expose us to legal liability. If you really want a root canal without it, go to a general dentist. Since it's not their specialty, they're far more flexible with this."

As much as I wanted a specialist doing my root canal, I figured I had to get a dentist to do it if I wanted to skip that awful thing.

My own dentist said, "Sure, we can leave it off. Truth me told, there are 10 minutes in the procedure where you need it. We will have half of it on during those 10 minutes. The other 80 minutes are unimportant and we can leave it off completely. The whole thing is really overkill other than those 10 minutes."

So that's what I did. And I lived. No infection, and the root canal went fine. I still have that tooth and crown.



So what does this have to do with the tax law and accountants? You can probably guess.

Russ Fox has to follow best practices. He's a good guy to ask as far as clarifying tax law or doing your return to the exact letter of the law. He's not a good guy to ask if you're going to fudge anything, or if you are trying to figure out what the IRS will or won't find objectionable.

The accountant is basically the endodontist here. If you want to deviate from "best practices", you're going to have to go it alone.

[Dan Druff]

Anyway, there's going to be very little attrition from this new tax law.

First off, the IRS may give guidance on this soon enough, and it's very possible that a lot of the assumptions being made right now will be rendered incorrect by the IRS.

For example, I am assuming that the IRS will insert a provision that you will never owe taxes if your overall win for the year is zero. The return lines may look like this:

45: Enter total amount WON for the year:

46: Enter total amount LOST for the year:

47: Subtract line 46 from line 45:

48: Multiply line 46 by 0.9:

49: Subtract line 48 from line 45:

50: If line 47 is 0 or negative, enter 0. Otherwise, enter the total from line 49. That is your gambling income:



We will have to wait and see. We will not be filing for 2026 until April 15, 2027, so there's time. It would be helpful to know in advance what we can expect, though. We'll have to wait and see.

Anyway, pro gamblers have always found a way to deal with taxes and keep gambling. This will be no different. You'll see.

[Dan Druff]

Oh, and you'll also see people "quitting due to the tax law" because they have either gone busto or haven't been winning in a long time, and this is their excuse to get out.

It will be a way to save face.

I'm already seeing it in poker. There are players saying, "Well, unless this changes, looks like I'm done with pro poker", and not so coincidentally, these are people I've observed losing overall for the past few-to-several years.

[jdaewoo]

You are GROSSLY underestimating the number of APs hitting US legal onlines. While not all activity generates W2Gs, if push comes to shove the IRS could ask to see online records which are accurate to the penny.

Just because the new tax law doesn't affect the AP things YOU do and won't deter YOU, there are plenty of people it will affect and deter. YOU aren't the center of the AP universe. You're barely on the fringe.

[Dan Druff]

You are GROSSLY underestimating the number of APs hitting US legal onlines. While not all activity generates W2Gs, if push comes to shove the IRS could ask to see online records which are accurate to the penny.

Just because the new tax law doesn't affect the AP things YOU do and won't deter YOU, there are plenty of people it will affect and deter. YOU aren't the center of the AP universe. You're barely on the fringe.

If these APs could only claim to have gambled online, you'd be correct.

However, APs can easily claim to have gambled anywhere in addition to online, and it would be tough to disprove.

There's also the audit issue. As I said, hardly anyone gets audited. In fact, I've been shocked how few have been audited, given that some players (and I'm talking about all pro gamblers, not just poker players or APs) are really bad at filing taxes. Some don't file, some blatantly understate winnings, some don't follow simple instructions, etc. The IRS has actually been far more lax on gamblers than you'd ever expect. You either have to really fuck up, play for really high stakes, or be really unlucky to get audited.

You act as if I haven't thought about every possible scenario. I have. Every single one of those scenarios leads back to what I posted earlier.

I understand it's a lot cooler to act outraged and to rage against the unfair and oppressive government. I understand it's always tempting to claim that every challenge is an existential threat, even though you're actually suffering from recency bias. And if you overcome that adversity, it feels a lot better than if you minimize the adversity you overcame. When I've completed a tough hike, I want to picture in my head that it looked more like climbing Everest than it does an introductory kiddie trail. That's human nature.

I just like looking at what's ahead and thinking, "What's actually likely to happen?", rather than, "What's the outlier worst case scenario?"