- There are various opinions on whether or not the “One Huge Stunning Invoice Act” elevated the slot tax reporting threshold
- The American Gaming Affiliation believes the edge was raised to $2,000
- A tax skilled in Las Vegas says the slot threshold wasn’t impacted
Did the Republicans’ “One Huge Stunning Invoice Act” (OBBBA) increase the slot tax reporting threshold from $1,200 to $2,000? There are differing opinions.
A lady celebrates after profitable a $2,050 slot machine jackpot on Oct. 14, 2024, in Las Vegas. Tax consultants say, opposite to some media studies, that the “One Huge Stunning Invoice” didn’t enhance the slot tax reporting threshold. (Picture: YouTube)
Among the many many tax implications included within the federal statute handed by Congress and signed into legislation earlier this month by President Donald Trump is Part 70433. The section refers to “Utility to Reporting on Remuneration for Companies,” or Part 6041(a) of the IRS tax code.
The OBBBA language raises the reporting minimal from $600 to $2,000. On line casino.org reported earlier this week on the American Gaming Affiliation (AGA) deciphering that to incorporate earnings from playing that’s reported by the W-2G kind.
In an announcement obtained on Tuesday, an AGA spokesperson mentioned the part “applies to any reporting beneath part 6041 of the Inside Income Code. The slot threshold is tied to that part of the code.”
The AGA offered a hyperlink for its rationalization that may be found here.
Some tax professionals, nevertheless, have differing opinions. Russ Fox of Clayton Financial and Tax, a distinguished Las Vegas tax skilled, explains that the tax provision applies solely to 1099-MISC filers. The submitting threshold for a 1099, starting subsequent yr, will enhance by $1,400 to $2,000.
The tax reporting threshold for a slot or different playing win, Fox believes, will stay at its present ranges (slots at $1,200, keno at $1,500, and desk video games at $600 when the payout is at the very least 300 instances the quantity of the wager).
Tax Clarification
Fox explains that the issuance of a W-2G is ruled by §3402(q) of the Tax Code — and that was not modified within the OBBBA.
Thus, starting in 2026, a W-2G should nonetheless be issued at $1,200 for a slot win,” Fox mentioned.
Fox says a rise to the slot threshold might nonetheless come, although he thinks the percentages are lengthy.
Now, it’s attainable Congress meant for each limits to extend. Usually, a ‘technical corrections’ invoice is proposed. That is normally bipartisan and fixes ‘oops’ gadgets. Nevertheless, given how polarized Congress is, I’ve my doubts about such a measure passing this yr. And it is likely to be that Congress meant this to be precisely as it’s,” Fox continued.
“Lastly, it’s attainable the IRS will interpret this legislation change to imply the W-2G threshold is elevated to $2,000. That may be welcome by nearly everybody, however I’d not maintain my breath ready for that interpretation,” Fox concluded.
The slot threshold hasn’t modified since 1977. The on line casino business has lengthy lobbied the federal authorities to extend the edge, as $1,200 in 1977 is about $6,600 at this time with inflation. Win a participant hits a slot prize upwards of $1,200, the sport goes offline till a slot attendant supplies the winner with a W-2G kind.
AGA Feedback
Chris Cylke, the AGA’s senior vp of presidency relations, informed SBC Americas that the gaming commerce group believes that OBBBA certainly raised the slot tax reporting threshold to $2,000.
“Elevating the slot tax reporting threshold to $2,000 and indexing it to inflation is a long-overdue modernization that reduces regulatory burdens and improves the shopper expertise,” Cylke commented. “It’s a hard-fought win for our business, and we look ahead to engaged on regulatory implementation.”
