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By Hugh Cameron
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The One Big Beautiful Bill Act that narrowly passed the Senate on Tuesday contains an amendment altering gambling tax rules, making it harder for winners to reap profits.
A section of the Senate's 940-page version of the bill limits the amount gamblers are able to deduct from their winnings to 90 percent of losses.
This means that if a gambler wins $100,000 in a tax year while also losing $100,000, they would be required to pay $10,000 in tax despite breaking even, rather than zero tax paid under current regulations.
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Why It Matters
If the amendment makes its way into the House version of the bill and is signed into law, it would reduce the ability of gamblers to turn a profit. It could also push professional gamblers to unregulated operators outside the U.S., according to American professional poker player Phil Galfond.
This could have a downstream impact on the entire industry, which brought in nearly $115 billion in revenue last year, according to the American Gaming Association.
What To Know
The budget reconciliation bill — a sweeping legislative package that incorporates many of President Donald Trump's domestic priorities — passed the Senate by 51 votes to 50 on Tuesday following weeks of negotiations.
It now returns to the House, which passed its own version of the bill in May. The House version of the bill does not currently contain provisions concerning professional gambling.
If the bill passes in its current Senate form, gambling losses and expenses will only be 90-percent deductible starting in 2026, and only up to the level of total winnings. Currently, gamblers can deduct wagering losses, provided these do not exceed their winnings for the tax year.
Galfond said that the amendment could result in tax being owed on "phantom" winnings, which will have a particularly detrimental impact on high-stakes players.
"Let's say that over the course of all the sessions that we played throughout the year, we won $5.2 million and we lost $5 million dollars for a net of $200,000," he said in a video posted to X, formerly Twitter.
"Now, we would pay as if we won $5.2 million, minus 90 percent of $5 million, which is $4.5 million for a fake net of $700,000... So you would make $200,000 during the year and pay tax as if you made $700,000."
Galfond added that the amendment could push professional gamblers toward offshore, unregulated gambling operators, while ensuring that amateurs – who are more likely to lose – increasingly dominate the U.S. market.
What People Are Saying
Poker player Phil Galfond told Newsweek that the policy "would mean the end of many pro gamblers' careers." However, he added that, "depending on how things unfold in the industry, I can see some pros continuing to survive."
Poker player Doug Polk wrote in a post on X to Texas Representative Chip Roy: "Chip, I am in your district. There is a provision in the Senate version that will kill professional gambling. This will negatively impact THOUSANDS of Texans. Please look at this and help remove this senseless provision."
He added in a separate post: "This has been snuck into the bill and if it passes tens of thousands of people will instantly lose their careers. We need to rally together now as the poker community."
What Happens Next?
House Republicans are now tasked with approving the Senate's changes to the bill before President Trump can sign it into law. Should the bill pass and receive Trump's signature, the amendment would take effect in 2026.
Trump has repeatedly expressed his hope that Congress can pass the bill by July 4, but he acknowledged on Tuesday that this deadline would be "very hard" to meet.
Update 7/3/25, 8:07 a.m. ET: This article was updated with comment from Phil Galfond.
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