New US state and federal gambling laws could affect betting revenue in 2026

A new US tax law could change Americans’ gaming experience in 2026, with President Donald Trump agreeing. Act on a big and beautiful bill (OBBBA) could see its net gains reduced.

Do you have to pay taxes on gambling winnings in the United States?

While previously punters could deduct their entire losses from their total winnings when calculating their taxable income, this provision would mean that only an amount equal to 90% of losses can now be deducted. This could cause punters to lose money as tax season approaches.

For example, someone who won $10,000 in betting but also suffered $10,000 in losses would still have to pay taxes on $1,000 of what they won. This would see them in a worse situation than when they started. The law change could raise an estimated $1 billion in funds for the U.S. government, according to estimates by the Joint Committee on Taxation.

American players will have to be luckier to come out on top overall as the new tax law comes into effect.

Attempts are already underway to reverse the change

The change was rejected by gambling groups across the United States, with Rep. Dina Titus in Nevada. introducing the FAIR Bet Act last year with the aim of reversing the change in gambling deductions and bringing them back to 100%.

Earlier this year, the Big BS Budget Bill changed the way gambling losses are taxed by capping the deduction at 90%. This means some players will owe taxes on money they never actually earned when they file starting in 2027.

But we still have time to resolve this problem. As long as we… https://t.co/UrtRQCHp0a

– Dina Titus (@repdinatitus) December 29, 2025

“It pushes people into the black market if they don’t play regulated games, because they have a tax disadvantage, and the black market doesn’t pay taxes, isn’t regulated and doesn’t help with gambling problems,” the Democrat said at the time. “So it’s bad for the industry as well as the player.”

Titus went on to criticize other parts of the bill beyond gaming, arguing that it was “already bad enough for my constituents” in various other areas as well. In December 2025, she pushed for a committee to be created to help the The FAIR Bet Act continues to advance.

New national gambling laws in 2026

In addition to these changes at the federal level, several states are also introducing new laws at the state level. This includes a widespread crackdown on sweepstakes casinos using dual currencies, with New York bans promotion of gamblingNew Jersey completely bans these games, California’s ban from January 1, and Indiana launches its first hearings after banning sweepstakes last year.

Michigan, Connecticut and Montana are also considering legislation that affect prediction markets. Indeed, states across the country were reviewing prediction market legislation that could run through 2026.

Featured Image: Flickrlicensed CC BY-SA 2.0

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