January 20, 2026
Federal lawmakers have introduced the FULL HOUSE Act, new bipartisan legislation aimed at reversing a recent change to the tax code that limits how much taxpayers can deduct in gambling losses. The Facilitating Useful Loss Limitations to Help Our Unique Service Economy Act was formally introduced in the House of Representatives by Steven Horsford of Nevada and Max Miller of Ohio.
The legislation seeks to restore a decades-old tax standard that allowed individuals to deduct 100 percent of their wagering losses against their winnings. This standard was recently altered by a provision in a larger tax reform package which reduced the allowable deduction to 90 percent. Under the current rules, taxpayers who break even or lose money over the course of a year may still face federal tax liabilities because they cannot fully offset their reported winnings with their total losses.
Proponents of the FULL HOUSE Act argue that the current 90 percent cap creates a scenario where the government taxes phantom income that was never actually earned. Representative Horsford stated that the policy is fundamentally unfair and could harm the economy of states like Nevada by discouraging tourism and professional gaming activity. He noted that there is strong bipartisan agreement that the reduction was a mistake that requires a legislative correction to ensure tax liability reflects actual economic reality.
Representative Miller emphasized that the bill is a matter of basic fairness within the tax code, stating that Americans should not be required to pay taxes on money they did not take home. The bill has received support from various gaming industry groups who warn that the lower deduction cap could drive bettors toward unregulated or illegal markets where tax reporting is not required.
The FULL HOUSE Act has been designated as H.R. 6985 and has been referred to the House Committee on Ways and Means for further consideration. If passed and signed into law, the amendments would apply to the current 2026 taxable year. This bill follows several previous attempts by other lawmakers to address the same issue, reflecting a continued push from representatives in regions with high concentrations of hospitality and gaming jobs.
