The ongoing battle to restore gambling loss deductions has once again failed. This is an amendment to bill HR7148, which was defeated in a recent committee hearing.
Representative In Titusa Nevada Democrat, called for change. She has now found 25 other lawmakers from both parties to support the change, but she continues to face criticism.
At the heart of the problem is the fact that Titus and other legislators do not believe that taxes should count gambling losses. Since this is money that the player did not earn, it is argued that it should be 100% deductible when tax season rolls around.
Speaking before the committee, Titus said:
“It’s a fairness issue. You shouldn’t tax people on money they don’t earn.
It’s phantom money, it’s not fair and we can do something about it. I invite you all to make this amendment admissible and return to the way things were and should be.”
The gambling tax simply won’t hold up
funny moment @RepMcGovern (D-MA, Ranking Member of the House Rules Committee) on the restoration of 100% deductibility of gambling losses (up to the limit of winnings)
“Your bipartisan amendment seems like a no-brainer, which probably means it won’t be introduced in order, I hope I’m… https://t.co/tb0BcKvaCU pic.twitter.com/Wkn53HAdUW
– DataBasedBets (@DataBasedBets) January 21, 2026
Featured on X, formerly Twitter, Rep. Jim McGovern, a Democrat from Massachusetts, said:
“Your bipartisan amendment seems obvious, which probably means it won’t pass. I hope I’m wrong about that…it just seems like common sense.”
The tactic used to pass this bill this time was to combine it with a larger bill.
It was noted that during the hearing, no “direct comments” were made by the Republicans in attendance. It’s also worth noting that some Republicans were not present during testimony at the hearing, as it focused heavily on ICE and the Department of Homeland Security.
The Trump administration’s change to how taxes and gambling are handled now leaves players with a 90% deductible cap. Despite months of decline until 2025 and now until 2026, it appears that the cap will be maintained.
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