Slot Winnings Threshold Officially Increased

Slot machine players winning less than $2,000 no longer have to worry about filling out paperwork for the IRS at the casino. The agency confirmed that the minimum threshold to trigger paperwork from the taxman will be raised to that amount beginning in 2026.

The increase, up from $1,200, comes as part of the One Big Beautiful Bill Act (OBBBA) passed in July. The move allows players a bit more in winnings before needing to instantly fill out IRS form W-2G. Additionally, that new amount will rise each year with inflation.

“For calendar years after 2025, the minimum threshold amount for reporting certain payments and backup withholding on certain information returns, including the Form W-2G, will be adjusted yearly for inflation,” the IRS reported in a note offering advice on the issue. “The minimum threshold amount for payments made in calendar year 2026 is $2,000.”

Lessening A Paperwork Headache

Prior to the increase, the $1,200 threshold hadn’t changed since 1977. Some tax professionals weren’t even sure if the language in the new law actually changed that.

However, the IRS has now confirmed the change. The new reporting amount will alleviate some paperwork requirements for casinos and winning players alike.

The increase comes up short of the Shifting Limits on Thresholds (SLOTS) Act proposed by some lawmakers earlier this year. That bill would have increased the reporting threshold to $5,000.

Casinos and state gaming regulators now must adjust to the new law. Despite the change, gamblers are still expected to report all winnings from slot machine play as well as from other games, when they file their taxes.

Deductions Change Still Concerning

While the OBBBA offered some relief on the slot threshold, another gambling tax provision is a source of consternation among poker players. When the bill takes effect on Jan. 1, gamblers will only be allowed to deduct 90% of losses after being able to deduct 100% in previous years.

Poker legend Erik Seidel has even threatened semi-retirement over the new provision. Especially among poker players at the highest stakes, the government could require tax payment on a losing year.

There is some hope the provision will be rescinded after gambling executives recently met with leaders on Capitol Hill. President Donald Trump has hinted that he would consider getting rid gambling taxes altogether.