Professional punters in the United States are predicting the end of their profession after President Donald Trump's signature One Big Beautiful Bill Act included a significant change in tax obligations.
Gambling wins or losses are taxable under United States law, with those bettors allowed to deduct 100 per cent of losses against their winnings, which must be submitted for assessment.
However, President Trump’s OBBB Act, which passed through the House of Representatives this week, states that bettors will only be allowed to deduct 90 per cent of their losses against 100 per cent of their gains in any given year.
This means some bettors would be forced to pay tax on an overall loss. This would impact high-volume gamblers the most, where in the instance of winning $200,000 and losing $210,000, they would still be forced to pay $11,000 in tax, despite posting a loss.
It has been decried as a "tax on volume” and has drawn wide condemnation from a host of advantage players across the United States.
Pro poker player Phil Galfond was among the first to raise major concerns with the changes.
"You can't be a professional gambler in the US if this goes through and that will have a ripple effect on industries that depend on professionals,” he said on X.
“I know you think a lot of industries don't depend on professionals, but the poker industry does, the DFS industry does. This will impact all the players."
Democratic congressman Ro Khanna also hit out against the changes, which passed the House on Thursday by just four votes.
“Republicans just passed legislation to kneecap sports and gambling in America by limiting the tax deduction on losses - that means that even in years you manage to beat the house, you get shafted. This is an attack on freedom, fun, and sports,” he said.
Unsurprisingly, the casino industry's lobbying body, the American Gaming Association praised the passage of the bill.
"We commend congressional leaders on the passage of the One Big Beautiful Bill Act. Our industry's ability to sustain quality jobs and deliver economic benefits is significantly enhanced by the tax policies of OBBBA that support consumers, encourage business innovation and investment, and strengthen U.S. competitiveness,” it said.
“We look forward to President Trump's expected signing and will work closely with Congress in the coming months to address the changes to wagering deduction losses and further modernize the tax code."
Thoroughbred investors and breeders are also set to benefit from changes within the One Big Beautiful Bill Act.
It makes permanent 100 per cent bonus depreciation, an important incentive for thoroughbred breeders and owners.
“Thanks to the leadership of Senators Thune and McConnell, and particularly the efforts spearheaded by Congressman Barr, Thoroughbred racing will come away with significant gains from the One Big Beautiful Bill. It can’t be overstated how important permanent 100 percent bonus depreciation is to the sport,” National Thoroughbred Racing Association (NTRA) CEO and president Tom Rooney said in a statement.
“Equally as important was getting the language changing section 461(l) removed. Those changes to the excess business loss carryover would have wiped out many gains that those in the horse industry would have seen with 100 per cent bonus depreciation. I’m grateful for all of the hard work that the Congressman put into getting this done for Thoroughbred breeding and racing.”
