What your statement fails to state is that it is on a per session or transaction basis. Gambling losses from one day are not allowed to offset winnings on another day.
Also, the accumulated itemized deductions including gambling must exceed the standard deduction to give you any benefit. The standard deduction amounts are $15,750 for single filers and married individuals filing separately, $31,500 for married couples filing jointly.
In addition, all your winnings go on the front of the return. This increase in your taxable income may push you over the threshold for the AMT, which disallows certain deductions to ensure high-income earners pay a minimum amount of tax.
Starting in the 2026 tax year, the “One Big Beautiful Bill” Act (OBBB) will cap the deduction for gambling losses at 90% of winnings.
For professional gamblers who engage in the trade or business of gambling, the rules could differ, and expenses might include “otherwise allowable deductions incurred on carrying on a wagering transaction”. However, the 90% deduction cap still applies, creating a new challenge for minimizing tax liability.
If I never handle another gambling US tax court case, I will be happy. I won every case, some for hundreds of thousands of dollars. However, I won on statutory technicalities, not the tax law.
