Help me out with the new wagering IRS rules

[Socalman3]

johnnym Wrote:
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> As my professor said and I quote.
> “ It’s one big club and you ain’t in it”.
> Good luck

George Carlin said that. He grew up right next door to my law school.

[belmont3]

Byrd Rule
https://atr.org/congress-should-restore-full-deductibility-of-gambling-losses/

[belmont3]

Multiple bills have been introduced to reverse the change:

FAIR BET Act (HR 4304) â€" introduced by Rep. Dina Titus (D-NV), this bill seeks to restore the full (100%) deduction.
NatP tax Blog
+2
NBC Sports
+2

WAGER Act (HR 4630) â€" introduced by Rep. Andy Barr (R-KY), this is a Republican-led effort to repeal the 90% cap.
CasinoBeats
+1

FULL HOUSE Act in the Senate (by Sen. Catherine Cortez Masto, D-NV) aims at a similar repeal in the upper chamber.
NBC Sports
+2
NatP tax Blog
+2

These efforts show bipartisan interest in reversing the deduction cut.
NBC Sports
+2
CDC Gaming
+2

However, so far, attempts have been blocked or stalled â€" for instance, Senator Todd Young (R-IN) objected to a unanimous consent move to overturn the change.
The Nevada Independent
+2
NBC Sports
+2

Additionally, the FAIR BET Act has gained new cosponsors, including both Democrats and Republicans, which suggests growing support.
CDC Gaming

⚠️ Challenges and likelihood

Procedural hurdles: Because the change was part of a large tax/appropriations bill, rolling it back may require going through the same complex legislative processes, which are difficult to navigate.

Revenue impact: The limit is projected to raise about $1.1 billion over 10 years, giving it some fiscal appeal.
NatP tax Blog
+2
The Nevada Independent
+2

Political will: Some lawmakers reportedly weren’t aware the gambling change was included in the larger bill, so awareness and pressure may drive more support.
The Nevada Independent
+1

Timing: The 90% limit doesn’t take effect until 2026, so there is still time for Congress to act before implementation.
NatP tax Blog
+1

[Socalman3]

belmont3 Wrote:
-------------------------------------------------------
> Byrd Rule
> https://atr.org/congress-should-restore-full-deduc
> tibility-of-gambling-losses/

This is interesting. But leaves a lot unanswered.

First off, I have to think that if they need to find extra revenue to fill a gap to comply with the Byrd Rule they had some choices - they could have added any other tax, but they chose to add this one - what were the other candidates that lost out (actually won out) to this one? How did the jockeying work out?

Second, the Byrd Rule is sort of like balance sheet and/or double entry accounting. If they needed to add something on one side of the ledger to make things balance (my first point above), the other way to address it is to reduce the item on the opposing side of the ledger.  So, there were other candidates to add, but there also had to be possible candidates to take away.  What were those?

This article seems to suggest that nobody intended to stick a fork into gamblers, they just needed to find money somewhere fast.  But they always need to find money fast and there are always a bunch of choices with lobbyists fighting to get picked (or not picked). I do not believe that it was an innocent oversight.  There were alternatives that had bigger protection rackets than our alternative had. That is the way things work on capitol hill.  Unfortunately, these choices are not made based on logic, math, and geometry.  They are made by brute politics.

[Socalman3]

Socalman3 Wrote:
-------------------------------------------------------
> belmont3 Wrote:
> --------------------------------------------------
> -----
> > Byrd Rule
> >
> https://atr.org/congress-should-restore-full-deduc
>
> > tibility-of-gambling-losses/
>
> This is interesting. But leaves a lot unanswered.
>
> First off, I have to think that if they need to
> find extra revenue to fill a gap to comply with
> the Byrd Rule they had some choices - they could
> have added any other tax, but they chose to add
> this one - what were the other candidates that
> lost out (actually won out) to this one? How did
> the jockeying work out?
>
> Second, the Byrd Rule is sort of like balance
> sheet and/or double entry accounting. If they
> needed to add something on one side of the ledger
> to make things balance (my first point above), the
> other way to address it is to reduce the item on
> the opposing side of the ledger.  So, there were
> other candidates to add, but there also had to be
> possible candidates to take away.  What were
> those?
>
> This article seems to suggest that nobody intended
> to stick a fork into gamblers, they just needed to
> find money somewhere fast.  But they always need
> to find money fast and there are always a bunch of
> choices with lobbyists fighting to get picked (or
> not picked). I do not believe that it was an
> innocent oversight.  There were alternatives that
> had bigger protection rackets than our alternative
> had. That is the way things work on capitol hill.
> Unfortunately, these choices are not made based on
> logic, math, and geometry.  They are made by brute
> politics.

I don\'t mean to be critical of the author of the article. I guess you need to put out the mistake or accident language in order to allow the people changing their vote to save face.  But, the reality is what happens behind closed doors.

[Fairmount1]

I\'ve been told more than a few times that this will be corrected at some point but unlikely that it happens this year.

If that does happen at any point after Jan 1, 2026, \"will it be retroactive?\" is the question.  

For now, the few pro horse racing gamblers are likely going to forego their rebate and fire away in the pools via cash is my educated conjecture.  They will likely use agents to bet in cash from multiple locations including across one of the borders to not draw attention (spreading wagers out over multiple people) and for tax reasons. (typically Canadian gambling winnings are tax free)

ADW\'s are not required to report all of your winnings to the IRS and the latest law did not change that.  However, like SoCalMan I wonder if the IRS decides otherwise but as of now my understanding is the w2-g winnings are the only reported amounts per the rules as previously stated: (winnings are $600 or more And winnings are 300x the amount of the wager).  

As for the trade off here . . . I have always just **assumed** that the depreciation and breeding Celebrations by NTRA for the Kings of the Sport in the Big Beautiful Bill were at the expense of the lowly gamblers who are looked at with disdain by the acceptable folks in society.

Happy Gambling in 2026!!  (you might just be gambling on if the ADW\'s are required to report All of your documented gambling activity at some point)