IRS Offers Surprise Benefit to Gamblers on Las Vegas Strip, Atlantic City, and Cruises

New Reporting Threshold: The IRS is raising the reporting threshold for gambling winnings requiring a W-2G form from $1,200 to $2,000, effective for payments made in 2026, with future adjustments for inflation.

Impact on Gamblers and Casinos: This change aims to reduce the administrative burden on casinos and improve the experience for players, as it decreases the frequency of intrusive reporting conversations for common payouts.

Bipartisan Support for Further Increases: Members of Congress are advocating for an even higher threshold of $5,000, citing the outdated nature of the current limit established in 1977 and its impact on compliance burdens for taxpayers and operational costs for casinos.

Tax Obligations Remain: Despite the increase in the threshold, all gambling winnings are still considered taxable income and must be reported on federal tax returns, regardless of the amount won.