Representative Dina Titus of Nevada was blocked by the House Rules Committee from attaching her Fair Bet Act to the 2026 National Defense Authorization Act. The GOP-controlled committee rejected the amendment on September 9, marking a setback for efforts to restore gambling tax deductions.
Why This Tax Fight Matters So Much
President Trump’s Big Beautiful Bill Act eliminated the 100% gambling loss deduction, creating a new tax burden for players. Beginning January 1, 2026, gamblers will owe taxes on winnings even if losses offset those earnings. For example, a player winning $100,000 but losing $100,000 would still owe $10,000 in taxes.
Titus argues that this change could drive players toward unregulated platforms and discourage proper reporting of winnings, undermining legal gambling channels.
What the Fair Bet Act Actually Does
Introduced on July 7, shortly after Trump signed his budget reconciliation bill, the Fair Accounting for Income Realized from Betting Earnings Taxation Act aims to restore the full gambling loss deduction. This would allow players to offset winnings with losses on a dollar-for-dollar basis, returning to pre-2026 tax treatment.
Titus attempted again on August 27 to include the legislation as a defense bill amendment, but the Rules Committee rejection halted that route.
How This Plays Out Next
The Fair Bet Act now moves to the House Ways and Means Committee, which handles tax policy. There, Titus will face the challenge of securing enough bipartisan support to counter Republican resistance. Time is limited, as the new rules go into effect January 1, 2026.
The gambling industry is closely monitoring developments, concerned that higher effective tax rates could push customers to offshore betting sites. Titus remains committed to advancing the legislation despite the setback, but broader support will be essential in the coming months.
