IRS Announces Updates to Tax Reporting on Casino Winnings

The United States Internal Revenue Service (IRS) has announced significant revisions to the federal reporting requirements for casino winnings, marking the first update in over fifty years.

New Reporting Threshold for Casino Winnings Set at $2,000

Since 1977, casinos have been obligated to file a Form W-2G if a player wins $1,200 or more on slot machines. This threshold has remained unchanged for decades, despite inflation and shifts in economic conditions, leading to widespread criticism.

Responding to these concerns, the IRS has raised the filing threshold to $2,000. This change, which was previously under consideration, has now been officially confirmed and will take effect starting in 2026.

Furthermore, the IRS has indicated that going forward, this threshold will be adjusted annually to keep pace with inflation and economic developments, ensuring that the reporting requirements remain relevant.

Implications and Potential Future Tax Changes

For casino patrons, this update means fewer interruptions during gameplay caused by tax reporting procedures. Casinos will also benefit from reduced administrative burdens and clearer tax reporting standards.

This initiative is part of a broader effort to modernize tax regulations in sectors where outdated rules have persisted.

Looking ahead, there is talk of more extensive reforms. Former President Donald Trump has suggested the possibility of eliminating federal taxes on gambling winnings altogether, as well as on tips, overtime pay, and social security benefits. However, no formal legislative proposals have been introduced at this time.