Big Beautiful Bill: A Potential Disaster for US Poker Pros

The Big Beautiful Bill, a massive budget reconciliation bill, includes a clause that could significantly impact professional online poker players and gamblers. The bill limits gambling losses to 90% of the losses incurred over the year. This means that professional gamblers would only be able to deduct 90% of their losses, which could make it impossible for high-volume players to stay profitable.

Professional gamblers have to itemize all of their individual sessions, and most sessions end in a win or a loss. For example, if a player plays 30 sessions over the year, winning exactly $10,000 at half of them, and losing exactly $8,000 at the other half, their final tally would look like this: Gambling profits: 15x$10,000 = $150,000 Gambling losses: 15x$8,000 = $120,000. With the current tax laws, the player can deduct their entire gambling losses and only pay taxes on their winnings, which, in this case, would be $30,000. However, with the proposed changes, the player would be allowed to deduct only 90% of their losses, which, in this case, would be 90%x$120,000 = $108,000. So, with this specific example, although the player won only $30,000 during the year, they’d be paying taxes on $42,000 ($150k – $108k).

Phil Galfond explains the financial impact of the bill on professional gamblers in a short video. Rich Muny of the former Poker Players Alliance commented on the latest developments, indicating that this was a clear example of why poker players need representation. He also mentioned that the UIGEA was passed in a similar fashion, and that some politicians claim the deduction is a subsidy for the gambling industry and want it gone completely.