Nevada Rep. Titus Introduces New Slot Winnings Tax Legislation

Written By Marc Meltzer on March 21, 2023
SLOT Act aims to raise tax threshold for winning players

Representative Dina Titus (D-NV) and a handful of other members of Congress recently introduced the Shifting Limits on Thresholds (SLOT) Act. The goal of the SLOT Act is to raise the tax threshold for slot winnings from its current $1,200 limit.

If approved, a new higher taxable winnings threshold would benefit both casino operators and players alike. Neither party involved likes dealing with the paperwork associated with each small slot jackpot.

SLOT Act a bi-partisan bill

Titus isn’t attempting to get this legislation, which would be popular with Nevada casino patrons, passed alone. Representatives Guy Reschenthaler (PA-14), Anthony Brown (MD-04), Mark Amodei (NV-02) and Steven Horsford (NV-04) also presented the SLOT Act.

PA’s Rep. Reschenthaler says:

“The 1977 slot jackpot reporting threshold hurts both Pennsylvania’s gaming industry and its patrons.

“Because the threshold has not kept up with inflation, it has resulted in a drastic increase in reportable jackpots, which trigger tax burdens for winners and compliance burdens for casinos. Increasing the threshold will eliminate this onerous red tape, ensuring the gaming industry can continue to support good-paying jobs and foster economic growth in southwestern Pennsylvania and across the country.”

Including representation from larger states like Pennsylvania could be a key part of the plan to finally get a higher taxable threshold approved.

This isn’t a new idea. In 2020, Congress directed the U.S. Treasury Department to look into raising the reporting limit. While a big deal for slot players and casino operators, there might be other more important items on the plate for Congress.

Inflation is on the minds of many Americans right now. This could be a good time for Congress to give some relief to a small segment of the economy.

Tax threshold last updated in the 1970’s

The current $1,200 IRS tax reporting threshold hasn’t been updated since 1977. It’s been 45 years since this number has changed.

For reference, the compact disc turned 40 years old this week. This threshold hasn’t been updated since before an extinct form of media was released. That’s wild.

If the reporting threshold was strictly adjusted for inflation, this number would be $5,957.23, according to the US Inflation Calculator.

In a statement, Titus said:

“Due to inflation, the number of jackpots hitting that threshold, triggering a shut down of the machine and necessitating excessive paperwork requirements for the patron, has increased dramatically.”

This creates an unnecessary burden on the gaming industry, an economic driver for Southern Nevada and other communities nationwide where slot machines exist. While I believe appropriate taxes should be collected on winnings, raising the threshold would reduce paperwork and ensure this is accomplished more efficiently.”

$1,200 doesn’t go quite as far in 2023 as it did in 1977. If nothing else, adjusting for inflation seems to be fair for gamblers. Additionally, casino employees would have free time for other duties.

Titus is looking to increase the reporting threshold to $5,000 for slot players. This W2G taxable reporting threshold also applies to video poker and keno players.

Handle tax bill also on tap

The duo of Dina Titus (D-NV) and Guy Reschenthaler (R-PA) also reintroduced another bill to Congress. This time the co-Chairs of the bipartisan Congressional Gaming Caucus, reintroduced legislation to repeal the 0.25% excise tax placed on all legal sports bets.

Most know this as the “handle tax” on sportsbook operators around the country. In addition to the tax, sportsbook operators around the country pay an annual $50 tax for each employee.

For reference, Nevada sportsbook operators paid nearly $22 million in “handle taxes” in 2022. This was almost double the state’s total from 2019. It’s also more than four times the national average.

However, this is more than a Nevada sports betting issue. Sports betting is now legal in 33 states around the country with more coming online each year.

Rep. Titus said:

“With the explosive growth of sports betting across the country, it’s time to finally repeal the handle tax which penalizes legal gaming operators and punishes sportsbooks for creating jobs.

As Co-Chair of the bipartisan Gaming Caucus, I’m pushing this legislation to keep legal gaming markets thriving nationwide and help local economies reap the benefits of this growing industry.”

This legislation won’t directly affect gamblers. However, saving sportsbook operators money could help push the sports betting industry forward by freeing up money to improve customer service and technology.

Time will tell if either or both bills will be passed by Congress.

Photo by Shutterstock
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Marc Meltzer

Marc grew up on the mean streets of the South Bronx. He's the rare combination of Yankees and Jets fan which explains his often contrarian point of view. Marc is a freelance writer and social media consultant. Writing about steak, booze, gambling and Las Vegas is a tough job but somebody has to do it.

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