{"id":106749,"date":"2019-06-11T17:20:08","date_gmt":"2019-06-12T00:20:08","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=106749"},"modified":"2019-06-11T17:20:08","modified_gmt":"2019-06-12T00:20:08","slug":"tax-deductions-on-gambling-losses-under-threat-in-california","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/tax-deductions-on-gambling-losses-under-threat-in-california\/","title":{"rendered":"Tax Deductions on Gambling Losses Under Threat in California, Tribal Casinos Expected to Fight Back"},"content":{"rendered":"

California State Assemblyman Adam Gray (D-Merced) wants to put an end to tax-deductible gambling losses.<\/a><\/p>\n

\"Adam
California Assemblyman Adam Gray\u2019s bill to scrap gambling-loss tax deductions is likely to be contested hard by his old foes, the tribal casinos. Native American operators have previously stood in the way of his efforts to legalize online poker and sports betting. (Image: mercedsunstar.com)<\/figcaption><\/figure>\n

Under current federal and state law, gamblers can claim deductions on gambling losses, provided these are itemized on tax returns and do not exceed the amount of income from gambling reported.<\/p>\n

But Gray believes the law is a \u201csin subsidy for the rich,\u201d mainly benefiting wealthy customers at California\u2019s tribal casinos. He wants an estimated $300 million deducted by gamblers each year to be diverted into programs that ensure Californians have healthy drinking water.<\/p>\n

Gray is sponsoring a bill called the Inland California Healthy Communities Act that would close what he describes as a \u201cloophole\u201d that \u201cbenefits fewer than 150,000 people, primarily millionaires and billionaires.\u201d<\/p>\n

If Congress wants to pay to subsidize gamblers that\u2019s their business, but we have families in California who cannot safely drink the water in their homes or get in to see a doctor,\u201d Gray explained.<\/p><\/blockquote>\n

Of course, the bill only covers state taxes paid by California residents. Federal gambling tax-reporting regulations, to which California currently conforms, would remain in place.<\/p>\n

Bad Beat for Poker Players?<\/strong><\/h2>\n

Gray does not explain in his news release announcing the bill why the existing tax regulations benefit only the rich, but it\u2019s likely he\u2019s referencing VIP players who are able to take advantage of luxury comps while breaking just above even at high-stakes games.<\/p>\n

But many professional gamblers — especially poker players — maintain a modest income by grinding small margins at California\u2019s casinos and card clubs, and their livelihoods would be jeopardized by the bill.<\/p>\n

The right of those who strive to make a living through gambling to have equal tax status with salaried individuals or businesses has been hard-fought for by the likes of Poker Hall-of-Famer Billy Baxter, whose federal tax refund case of 1986 established that gambling winnings should be classified as \u201cearned income.\u201d<\/p>\n

Tribes Will Block Bill<\/strong><\/h2>\n

Meanwhile, the bill will face fierce opposition from California\u2019s powerful Native American casinos — for whom it will be bad for business — and the lawmakers who represent them.<\/p>\n

The state\u2019s tribal operators have collectively contributed billions of dollars to the state\u2019s general fund, as well as their host communities, which affords them a great deal political power, as Gray knows only too well.<\/p>\n

\n

Gray has historically been a proponent of gambling expansion in California, spearheading recent efforts<\/a> to legalize online poker and sports betting, and negotiating with the tribes as future stakeholders.<\/p>\n<\/div>\n

But the tribes have wilfully delayed the process to legalize these markets, mainly because they fear their hard-fought exclusivity on casino gaming will be eroded by commercial interests.<\/p>\n

\u201cAlthough seemingly popular, elimination of this deduction will have consequences \u2013primarily on tribal governments \u2013 which we have not had the opportunity to adequately analyze given the absence of any meaningful consultation with Indian tribes,\u201d California\u2019s Tribal Alliance of Sovereign Indian Nations said in a statement to The San Diego Metropolitan.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

California State Assemblyman Adam Gray (D-Merced) wants to put an end to tax-deductible gambling losses. Under current federal and state law, gamblers can claim deductions on gambling losses, provided these are itemized on tax returns and do not exceed the amount of income from gambling reported. But Gray believes the law is a \u201csin subsidy […]<\/p>\n","protected":false},"author":36,"featured_media":106750,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[13,18,18456],"tags":[],"acf":[],"yoast_head":"\nTax Deductions on Gambling Losses Under Threat in California<\/title>\n<meta name=\"description\" content=\"California State Assemblyman Adam Gray believes tax deductions on losses for gamblers benefit only the rich. 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