Year-End Window Narrows for FAIR BET Act to Undo Gambling Loss Deduction Cap

Nevada Rep. Dina Titus is pressing House Speaker Mike Johnson and Majority Leader Steve Scalise to attach the FAIR BET Act to must-pass legislation before Congress adjourns. The bill would restore the full deduction for gambling losses, reversing a limit imposed by last year’s One Big Beautiful Bill Act.

The existing rule caps deductible losses at 90% of winnings. A gambler reporting $100,000 in winnings matched by equivalent losses now faces tax on $10,000. The prior 100% deduction eliminated taxable income in such break-even scenarios.

Bill Status and Legislative Path

The FAIR BET Act, formally the Fair Accounting for Income Realized from Betting Earnings Taxation Act and designated H.R. 4304, was introduced on July 7, 2025. It secured bipartisan support and cleared the House Ways and Means Committee by a 38-5 vote in September yet has not advanced to a full House floor vote. Titus, whose district covers the Las Vegas Strip, sent a letter to Republican leadership citing the unfair burden on both professional and recreational gamblers.

Risks of Inaction for Regulated Markets

As reported by This Week in Gambling, the current tax structure could drive players to offshore and unregulated platforms. That migration would erode consumer protections, responsible gambling programs, and federal tax revenue while reducing investment and employment at domestic gaming companies. With Democrats expected to control Congress after the 2026 midterm elections, the measure may need reintroduction in January if not enacted now.

The coming weeks will test whether House leadership treats the FAIR BET Act as essential year-end business. Regulated operators and investors face continued uncertainty on player economics absent restoration of the prior deduction framework.