This question will resolve to TRUE if the final version of the bill includes a cap on deductions for gambling losses at any level below 100%. This will resolve NO if the Bill does not pass in 2025 or if the Bill passes allowing 100% deductions for wagering losses.
The Senate version of the bill includes the below:
SEC. 70114. EXTENSION AND MODIFICATION OF LIMITATION ON WAGERING
LOSSES.
(a) In General.--Section 165 is amended by striking subsection (d)
and inserting the following:
``(d) Wagering Losses.--
``(1) In general.--For purposes of losses from wagering
transactions, the amount allowed as a deduction for any taxable
year--
``(A) shall be equal to 90 percent of the amount of
such losses during such taxable year, and
``(B) shall be allowed only to the extent of the
gains from such transactions during such taxable year.
``(2) Special rule.--For purposes of paragraph (1), the
term `losses from wagering transactions' includes any deduction
otherwise allowable under this chapter incurred in carrying on
any wagering transaction.''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2025.
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@JJhhtS could regulated prediction market platforms be the future for gamblers (in macro events and possibly “sports events contracts”)? Reading there’s some uncertainty around tax treatment, if they’re 1256 contracts could even be better treatment than gambling. (Not a tax expert)
@AndrewCourtney At this point, it's the only thing that makes sense to a professional sports gambler. You're absolutely correct, though. Profits from contracts traded on CFTC regulated markets are given much more favorable tax treatment (part of the reason sports contracts will not last forever, IMO)
@AndrewCourtney Once the govt realizes people are getting the long-term capital gains tax rate on the winner of a regular season baseball game I think there's gonna be some changes 😅