LAS VEGAS — Restoring the full gambling loss deduction remains unfinished business for Nevada lawmakers more than a year after Congress reduced it.
- A House committee approved a broader tax package containing the proposed deduction fix in September.
- The 90% limit can leave gamblers with taxable income even when they break even.
- The restoration effort has no announced timeline for further congressional action.
Democratic Rep. Steven Horsford highlighted his FULL HOUSE Act during the Global Gaming Expo (G2E), framing the restoration as a matter of “fairness.”
“The people who make our state and our communities prosperous, because of their hard work, we're going to make sure that their voice is at the table,” Horsford said at G2E.
But despite a lopsided, bipartisan committee vote in September, there is no announced timeline for further action. Gamblers who deduct losses on their tax returns still face an increased tax burden for the 2026 tax year unless Congress reverses the change.
Bill details and progression
Horsford’s proposal would restore taxpayers’ ability to deduct 100% of their gambling losses against their winnings, up to the amount won. The One Big Beautiful Bill signed by President Donald Trump in July 2025 reduced the deduction to 90%.
Winning bettors who claim gambling loss deductions can see their tax burden increase.
The new structure also creates potential tax liabilities for gamblers who break even or lose money.
A gambler who records $10,000 in winnings and $10,000 in losses could deduct only $9,000 under the 90% limit, leaving $1,000 in taxable gambling income despite only breaking even. Restoring the full deduction would eliminate that taxable income for a gambler who breaks even, subject to applicable deduction requirements.
The restriction applies beginning with the 2026 tax year, according to IRS guidance, meaning gamblers already face the reduced deduction as lawmakers debate a reversal.
Horsford discussed the tax legislation during a G2E panel focused largely on prediction markets and their implications for regulated gaming. He linked the tax issue and prediction markets to their potential impacts on dealers, hospitality employees, and other workers whose livelihoods depend on the industry.
The tax restoration secured its most significant legislative advancement Sept. 16, when the House Ways and Means Committee voted 38-5 to approve a broader tax package containing the fix. The Digital Asset Tax Certainty Act still requires approval from the full House and Senate before it can reach the President.
Horsford, who introduced the FULL HOUSE Act with Republican Rep. Max Miller of Ohio, said before the committee vote last month that the deduction change reaches beyond individual gamblers’ tax returns.
“Gaming is central to our economy and for workers and families throughout my district, they depend on it, including union workers,” said Horsford, whose district includes parts of Las Vegas.
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Frustration remains
Fellow Las Vegas-area Democratic Rep. Dina Titus welcomed the September committee action while criticizing the delay to reach that point. Titus introduced her FAIR BET Act on July 7, 2025, shortly after the broader tax legislation became law. Her bill would similarly restore the full gambling loss deduction.
More than two dozen bipartisan Senate and House members have cosponsored versions of the tax restoration legislation, but the effort gained little traction until last month’s vote.
“I am disappointed it took the House committee so long to take action,” Titus said in her statement after the language advanced out of the Ways and Means Committee.
Lawmakers from Nevada, the nation’s gaming capital, have long led congressional action on the industry.
Titus and Horsford testified at a July 2025 Ways and Means field hearing in Las Vegas. Titus also sent letters urging the committee to include the restoration in a legislative package. At that hearing, committee chair Jason Smith, a Missouri Republican, publicly acknowledged bipartisan interest in addressing the change.
More than a year later, the committee vote provided momentum but left the final outcome unresolved. The House was not expected to take further action until after the November midterm elections. With no announced timetable, the restoration effort could remain unresolved when the new Congress takes office in January.
At G2E, Horsford said much of the remaining work requires “educating” members of Congress about the importance of the tax impact. In the meantime, groups such as the American Gaming Association and major casino operators continue to support the restoration. They argue that taxing gambling income players never realized could discourage participation in legal gaming and hurt related businesses.
Wynn Resorts CEO Craig Billings said in Horsford’s September release that the committee action represented progress, while emphasizing that additional work remained before the congressional session ends.
Horsford similarly presented the vote as an advancement rather than a completed fix.
“No one should pay taxes on money they never earned,” Horsford said in his release after the vote. “This is about the workers supporting their families, the small businesses keeping their doors open, and the communities that make Nevada home.”
