As far as we know, the answer to your question is probably not. We haven't heard one word about a movement in Washington, or anywhere else, to raise the tax-reporting requirements for gambling-machine jackpots above $1,200.
But yes, you're absolutely right about the need to raise it. This tax-reporting threshold dates back to the days of mechanical slot machines, when someone hitting a slot jackpot of more than $500 was so rare that it necessitated the machine being removed from the casino floor to be examined by a battery of slot technicians, a further lengthy investigation by the Gaming Control Board, a background check into the winner by the Las Vegas police, FBI, and Interpol, and a note from the winner's lawyer, psychiatrist, and mother.
OK, so maybe we're exaggerating a little. Still, since slot machines rarely paid out big bucks, in the unlikely event that the top jackpot was hit, the $1,200 threshold wasn't much of a burden to players or casinos.
Of course, that was long before video poker, linked progressives, multi-denominational and multi-line machines, and $1,000 tokens. Indeed, today, the highest-denomination slot and VP machines require a casino employee to sit next to the player during his or her entire session in order to record tax information every time the player hits something; at video poker, it's three-of-a-kind on a $500 machine, two pair on a $1,000 machine, or even a push on a high pair on a $2,500 machine. This is not only time-consuming and annoying, but the amount of paperwork generated is staggering.
All that said, we're not holding our breath for the threshold to be raised anytime soon. First of all, changing the tax code is no easy feat. And secondly, since the onus is on the taxpayer to account for his or her losses, and since losses can only be deducted from wins till the two zero out, and since tax-collecting authorities are forever seeking more ways to vacuum more money out of more citizens, it's conceivable that the IRS actually wants it to be lowered.
