The new tax law was signed on July 4, 2025. The gambling provisions have little effect on recreational gamblers but are career-endingly serious for professional gamblers. The Gambling with an Edge podcast with Russell Fox about this new tax law was posted July 16, and you can find it on YouTube or in several other places.

There are several possibilities that this law could be changed before January 1, 2026 — and we won’t know for some time if any of these possibilities will come in.  While Richard Munchkin expressed optimism in the podcast about one of these avenues for changing the law coming to fruition before January 1, I’m less sanguine about it. I’m preparing for my gambling life as I know it to be over in a few months.

For those unaware of how punitive this new law is for professional gamblers, consider two recent years of mine. In both years my W-2Gs added up to about $6 million. I’m playing high denominations games with a small edge. In one year, my gambling score was -$150,000 and in the other, +$200,000. I have non-gambling income as well. I also record my gambling expenses, which I’m entitled to do as I file as a professional gambler.

In the first year, since I lost money gambling, I paid no taxes on the gambling part of my income. In the second year, I paid quite a bit. Nobody likes to pay taxes, certainly including me, but it’s the price we pay to live in this country.

Under the new law, I would only be able to deduce $5.4 million in gambling losses in each year. (W-2Gs are considered proven gambling wins by the IRS and you can deduct up to 90% of them as losses.) That means in both years (one I lost $150,000 and the other I won $200,000), I would owe taxes on $600,000 of phantom income, in addition to the taxes on my other income. Minus 90% of my gambling expenses, of course, but those came nowhere near $600,000.)

It won’t take many of these tax years to wipe me out completely.

Some people manage to avoid paying taxes by simply lying about how much they make. When you get W-2Gs, though, you can’t lie about them. They go to the IRS and your tax return should claim at least the total dollar amount on the W-2Gs as in on the IRS computers, or they will come after you. In the past, it was always safe to add a few hundred thousand dollars to the W-2G total (because they would all be written off), but starting next year, adding $200,000 to this total will increase the amount you have to pay taxes on by $20,000.

Playing single-line quarters and avoiding W-2Gs altogether is not something I’m interested in. I don’t gamble “for fun.” I gamble for profit and the profit you can make playing games this small are smaller than I wish to seek. I know some of my readers take this route, and I’m not putting them down in any respect, but it’s not the life I want for me.

I’m both planning on exploiting the games I find for the last five months of this year, and planning on what I’m going to do with the rest of my life. This second kind of planning is both more difficult and not as far along as my plans for the rest of this year. It may well include stopping writing this blog. Most of the blog-posts here are inspired by something happening in a casino. If I won’t be in casinos, I’ll simply run out of new things to say. I already repeat myself more than some of you like. 

I’ve considered stiffing casinos on my way out the door on December 31, but have decided against it. While the gambling law might not change prior to 2026, there are also possibilities it could change in mid-2026 or later and I want to keep casino doors open to me should that happen. Stopping playing because of the tax law is easy for casino to understand. If they tolerated my action before, they will probably welcome me back. Taking front money and then not playing (so as to maximize my short-term profits on the way out the door) is much harder for casinos to forgive. So, I won’t do it.

One thing I won’t do is to lie around and cry over opportunities lost. I’ve had a longer and more successful gambling career than most, and if it ends in five months, so be it. I’ve saved enough to be set (unless the Doomsday Clock actually strikes twelve, which is definitely possible), so Bonnie and I will make the best of the time we have left together.

And, of course, I will hope the law gets changed soon. If it does, I plan to be ready to go in 2026 right where leave off on in 2025.