Full House Act: New Hope to End Gambling’s Phantom Tax
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It was one of PokerNews' top stories of 2025 and could force poker Hall of Famer Erik Seidel into retirement, but all eyes are still on attempts to repeal the gambling "phantom tax" introduced in last year's "One Big Beautiful Bill".
The Fair Bet Act was intended as an emergency fix to stop this, but last week the House Rules Committee officially sent that bill to the sidelines. However, a new act might be the "ace up the sleeve" of the gambling industry. The Full House Act is a bipartisan bill that still aims to restore full gaming loss deductions, and has a much better shot at actually crossing the finish line.
Why the Fair Bet Act Stalled
The Fair Bet Act, introduced by Congresswoman Dina Titus (D-NV), was the first big attempt to fix a new tax rule scheduled to kick in for the 2026 tax year. This rule was tucked into the "One Big Beautiful Bill Act" passed last year and limited a gambler's ability to deduct losses.
Currently, if you win $10,000 and lose $10,000, you break even and owe $0. However, the One Big Beautiful Bill reduced the allowable deduction to 90% of losses.
But under the new 2026 rules, you could only deduct 90% of those losses, meaning the IRS would tax you on $1,000 of "income" you never actually kept, or so-called "phantom winnings."
However, the bill was rejected by the Rules Committee in the U.S. House of Representatives back in September, and stalled again last week when it was mooted as an amendment to a larger defense bill earlier this month.
House leadership and lawmakers felt it was the wrong vehicle for the change, leaving many worried the 90% cap was here to stay.
Enter the Full House Act
While the Fair Bet Act flamed out, the Full House Act is stepping in.
An earlier bill by the same name was introduced in July 2025 by Sen. Catherine Cortez Masto (D-NV), but the effort was swiftly blocked.
This new Bill is being introduced as an amendment to a minibus discussed this week by the House Rules Committee. Hopes are high due to its bipartisan support and the fact that one of its co-sponsors represents a "non-gaming" state. The Full House Act would restore the original rule, allowing 100% of gambling losses to be fully deducted.
While Rep. Steven Horsford (D-NV) has represented Nevada's 4th district since 2019, he is joined in these efforts by Rep. Max Miller (R-OH) of Ohio's 7th congressional district. Both Horsford and Miller sit on the United States House Committee on Ways and Means.
"The Full House Act is about basic fairness in the tax code," said Miller. "Americans should not be taxed on money they didn’t actually take home. By restoring the full deduction for gambling losses, this bill ensures the IRS treats taxpayers honestly and consistently.
"I’m proud to lead this bipartisan effort with Congressman Horsford, and I urge my colleagues to support this common-sense fix."
A "Common Sense Technical Correction"
According to Fairplaygov on X, there is a hope that the bill is introduced under "closed rules," whereby debate is eliminated and potential amendments restricted.
However, it could also be included as a "Self-Executing Rule" where a vote on a procedural rule simultaneously passes an amendment without the need for a separate vote.
"The hope is that this is viewed as a common sense bi-partisan technical correction with little budgetary impact," Fairplaygov posted on X.
