Tax Facts

8026 / Can taxpayers deduct loss expenses related to gambling?

Yes. However, effective for tax years beginning in 2026 and beyond, taxpayers are only entitled to deduct 90% of their gambling losses and only to the extent of their gambling gains.


Under the 2017 tax reform legislation, the limitations on losses related to gambling that may be deducted also include other expenses incurred in connection with the gambling (i.e., the cost of travelling to and from a casino subject to the Section 165(d) limitation). This essentially means that costs associated with a trade or business of gambling are now included in the loss limitation.



This provision applies for tax years beginning after December 31, 2017.1






1.  IRC § 165(d).

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