New W2G Limit is 2K?
The W-2G trigger is not in the United States Code, but the Code of Federal Regulations. A number of sources claim that the same bill raised them to $2,000, again starting in 2026, but I cannot find it in the bill, which is not surprising as I don't think bills can affect the CFR - only the USC.
Quote: Simon23Does anyone know whether the jackpot limit for a triggered W2G form will increase to $2,000 starting in 2026 or is this a fantasy that I imagined. I believe I did not imagine that you will only be able to deduct 90% of losses (instead of the 100% previous) against wins for those who itemize their taxes. Does this kill machine play for big video poker or slot players? Am I missing something?
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$2,000 is a nice start, but the threshold REALLY should have been upped to $5,000. $1,2000 started in the 1970's, around 1977 to be exact when $1,200 could comfortably sustain a Mother, Father, and three children for TWO MONTHS. $1,200 in 1977 was the equivalent of around $6,000 today. $1,200 was BIG money in the 1970's when the Jackpot started but nowadays, it REALLY isn't all that much money. $1,200 TODAY will get you a small studio apartment rent for one month for a single adult whereas in the 1970's $1,200 would get you two months mortgage payment, two car notes, electricity, clothing , TV service, and food and water for two months. 💡
The news media has run away with a story that slots are going to raise their threshold for issuing W-2G's. At this point I can only put that down to wishful disinformation.
Even casinos are getting confused, so they just may raise the thresholds for a W-2G until told differently by the IRS. Raising the hand pay limit would require effort by casinos and it's too soon to know if misled casinos will raise their hand pay threshold from $1,200 to $2,000. Typical thought is they will leave the hand pay at $1,200 and if the W-2G threshold is raised by mistake, they won't issue W-2G's until $2,000. The machine will just continue to lock up at $1,200, but the attendant will just bring around the cash minus the tax forms.
As for the 90% of losses portion of the tax bill, it will wipe out players who rack up a lot of W-2G's playing higher limit slots and depend on itemizing their sessions. If they are losing players for the year anyway, depending on the math, it may not make a difference. But if you're running a >90% RTP on sessions, you will be hurt, badly, for phantom income. Slot machines may just freaking disappear from casinos like tourists from Vegas already, in 2028. Poker tournaments will have to leave the country in 2026. Cash game poker play may be unaffected if nobody is keeping track of their sessions.
Not sure bad beat jackpots will survive.
https://www.hollywoodcasinotoledo.com/-/media/png/east/hollywood-toledo/pdfs/poker-flyers/bad-beat-jackpot-ruleseffective-4202017.pdf
Bad beat wins threshold will likely be raised to $2,000 because they get 1099 forms instead of W-2G's.
https://www.pokernews.com/pokerterms/bad-beat-jackpot.htm
Examples of a "Bad Beat Jackpot"
In a game of Texas Hold'em, a player loses with quad Aces against a straight flush. If the jackpot amount is $1,000,000, the losing player is awarded 5% of the total pot ($50,000), while the winner of the hand is awarded 1% ($10,000).
In a game of Omaha, a player loses with a straight flush to a royal flush. The losing player is awarded a fixed payout of $5,000 from the bad beat jackpot.
At a low-stakes Texas Hold’em table, one player hits quad Jacks, but another makes a straight flush. The bad beat jackpot awards the quad Jacks holder $10,000, the straight flush winner $5,000 and each seated player $1,000.
Quote: ChumpChangeIf you get a casino prize, not a slot jackpot, that threshold will be raised to $2,000. Say you are on a drawing to spin a wheel for prizes and they had cash prizes on the wheel, you'll be good up to $2,000 instead of up to $1,200 or $600.
The news media has run away with a story that slots are going to raise their threshold for issuing W-2G's. At this point I can only put that down to wishful disinformation.
Even casinos are getting confused, so they just may raise the thresholds for a W-2G until told differently by the IRS. Raising the hand pay limit would require effort by casinos and it's too soon to know if misled casinos will raise their hand pay threshold from $1,200 to $2,000. Typical thought is they will leave the hand pay at $1,200 and if the W-2G threshold is raised by mistake, they won't issue W-2G's until $2,000. The machine will just continue to lock up at $1,200, but the attendant will just bring around the cash minus the tax forms.
As for the 90% of losses portion of the tax bill, it will wipe out players who rack up a lot of W-2G's playing higher limit slots and depend on itemizing their sessions. If they are losing players for the year anyway, depending on the math, it may not make a difference. But if you're running a >90% RTP on sessions, you will be hurt, badly, for phantom income. Slot machines may just freaking disappear from casinos like tourists from Vegas already, in 2028. Poker tournaments will have to leave the country in 2026. Cash game poker play may be unaffected if nobody is keeping track of their sessions.
Not sure bad beat jackpots will survive.
https://www.hollywoodcasinotoledo.com/-/media/png/east/hollywood-toledo/pdfs/poker-flyers/bad-beat-jackpot-ruleseffective-4202017.pdf
Bad beat wins threshold will likely be raised to $2,000 because they get 1099 forms instead of W-2G's.
https://www.pokernews.com/pokerterms/bad-beat-jackpot.htm
Examples of a "Bad Beat Jackpot"
In a game of Texas Hold'em, a player loses with quad Aces against a straight flush. If the jackpot amount is $1,000,000, the losing player is awarded 5% of the total pot ($50,000), while the winner of the hand is awarded 1% ($10,000).
In a game of Omaha, a player loses with a straight flush to a royal flush. The losing player is awarded a fixed payout of $5,000 from the bad beat jackpot.
At a low-stakes Texas Hold’em table, one player hits quad Jacks, but another makes a straight flush. The bad beat jackpot awards the quad Jacks holder $10,000, the straight flush winner $5,000 and each seated player $1,000.
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Casino prize vs Slot Jackpots does make a lot of sense. Speaking of winning Jackpots in a Casino, a guy won $500,000 in the Casino and blew it all back in that same Casino the same day. I mentioned feeling it's unfair that he has to pay taxes on money he blew right back to the Casino the same day and didn't even leave with any of that money.
Posters responded something like, "He would just claim the $500,000 as a LOSS and not a WIN when he is filing his taxes. He most likely wouldn't pay taxes on a $500,000 LOSS. Because technically if you win $500,000 in a Casino and lost it the same day right back to the Casino, that's not a WIN, you LOST the $500,000. The IRS wouldn't make you pay taxes on LOST money." Is this answer correct? Could he just claim it as a LOSS and not a WIN and not have to pay any taxes on it? 🤔
I did see one instance of words where the writer included the W-2G jackpot in his gambling diary but counted that win as an additional loss in the same session. So say he buys-in for $5,000, wins $50,000, gets paid in cash, then loses $30,000 of it, and he cashed out at the cage with $22,000 because he lost $3,000 before he won the jackpot. He'd have a buy-in of $5,000, a cash-out of $22,000 for a net profit of $17,000. Then you subtract the $50,000 W-2G and get the $33,000 loss.
I don't know, I think I'm misinterpreting here and I've never filled one of these out and I may have a puzzle piece misplaced. I'd have a separate column in my gambling diary for W-2G wins. I'd have columns for Buy-ins, Cash-outs, session win, & session loss, Daily Win/Loss Cumulative, Cumulative Win/Loss, and W-2G's Session and Cumulative. I think I'd subtract the $50,000 W-2G between the Session Win & Session Loss columns and the Daily Win/Loss Cumulative columns. So I'd mark down a $17,000 win for the session, but enter it as a $33,000 loss in my Daily Win/Loss Cumulative column. I add up my session win and add up my session loss columns separately and subtract the W-2G Cumulative column from those totals and put the $33,000 loss in the Daily Win/Loss Cumulative column. So like I said, a $17,000 win then a $50,000 loss added on for a $33,000 loss. Then the W-2G's are figured on a separate line on the tax form as income. The W-2G's will always count as profit.
