The King of the Casinos vs. the 90% Gambling Loss Rule
A 24-second comedy short from W2gMatch. General information, not tax advice.
Jack, King of the Casinos, takes the stand: he won a million, he lost a million, so they're even. His own CPA, Penny, has the 2026 rule, and the ruling is short. Jack and Penny were first introduced as Larry and Diane, the names you may still see or hear in this film.
The fact behind the joke: the rule behind the ruling
- For tax years beginning after December 31, 2025, section 165(d) as amended by the One Big Beautiful Bill Act lets you deduct only 90% of gambling losses, and still no more than your winnings. Win $100,000 and lose $100,000 in 2026: deduct $90,000, owe tax on $10,000. At Jack's scale, a million in and a million out leaves $100,000 taxable. The 90% gambling loss cap for 2026 →
- Losses count only if you itemize on Schedule A. Returns for 2025 still deduct 100% of losses, up to winnings. Can I deduct gambling losses? →
- Repeal cleared the House Ways and Means Committee 38-5 on September 16, 2026. It is not law, so the 90% limit still applies to 2026. FAIR BET Act status →
- Broke even and still owe? The worked numbers, with a 2025 and 2026 comparison. The phantom income example →
High rollers don't guess. They reconcile.
See what the 2026 rule does to your own winnings and losses, in seconds.
Key moments
Transcript
- 0:00On screen: TAX YEAR 2026
- 0:00The King of the Casinos takes the stand.
- 0:02On screen: Larry, King of the Casinos
- 0:03Your Honor. I won a million.
- 0:05I lost a million. We're even.
- 0:07On screen: Diane, His CPA
- 0:07From tax year 2026, only 90% of losses are deductible.
- 0:13On screen: 90% of losses deductible, up to winnings, if you itemize.
- 0:13Objection.
- 0:15Overruled. Still ninety.
- 0:15On screen: Win $1M. Lose $1M. Taxed on $100K.
- 0:18On screen: High rollers don't guess. They reconcile. w2gmatch.com/calculator
More short films
- A Wildlife Crew Films a High Roller. His CPA Ruins the Shot.
- A CPA Matches the Last W-2G Like It's a Title Game
- Vegas Matt, Mr. Hand Pay, Slot Queen: The Week in Gambling (Ep. 1) with Jack and Penny
- FanDuel Win/Loss Statement for Taxes: Where to Find It (2025 & 2026)
- How to Get Your Caesars Rewards Win/Loss Statement
- Kalshi Taxes: Which 1099 Do You Get?
- All videos
New films on YouTube: @W2gMatch. Creators can share and clip these films: see the partner kit.
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General information, not tax advice. The tax facts are stated, with their sources, on the linked answer pages; a licensed CPA or enrolled agent should review your return before it is filed.