What Are We Even Doing?
Buried inside the so-called “Big Beautiful Bill” is a small tax tweak with huge potential consequences for gamblers and the entire Nevada economy. Starting in 2026, gamblers will no longer be able to deduct 100% of their gambling losses against their winnings on federal taxes. Instead, they’ll be capped at 90%. On paper that sounds minor; on the casino floor it’s a disaster. High-volume players routinely cycle hundreds of thousands—and in some cases millions—of dollars through the window. Under the new rules, a player who wins and loses the same $1 million over a year could still be taxed on $100,000 of “income” they never actually kept. That’s phantom income, and it makes the math of playing domestically a lot less attractive.
Casino operators like Derek Stevens have been blunt: if you tax people on money they lost, the sharpest and highest-value customers will simply move action offshore or to gray markets where the IRS can’t touch them. When the whales and serious sports bettors leave, they don’t just take their bets; they take room nights, restaurant tabs, show tickets, and tips that support tens of thousands of hospitality workers. A federal change that was pitched as a painless revenue raiser suddenly becomes a direct hit to Las Vegas jobs and state tax receipts.
Recreational players get squeezed, too. Casual visitors who treat a Vegas trip as entertainment are now staring at more complicated record-keeping and the possibility of owing federal tax in a year they feel like they “broke even.” That’s a pretty good way to convince a middle-class tourist to stay home or move their bets to an unregulated app instead of a legal sportsbook.
Lawmakers like Rep. Dina Titus are pushing the FAIR BET Act to restore the full deduction, but nothing is guaranteed. Until it’s fixed, the Big Beautiful Bill creates a perverse incentive structure: the more you participate in America’s legal, regulated gambling ecosystem, the more likely you are to be taxed on money you never truly won. That’s not just bad policy—it’s an open invitation for the industry’s most valuable customers to leave the regulated market altogether.
