You may have heard that the IRS is thinking of raising the reporting threshold for slot jackpots. But even if they don’t, the Handpay Reduction Act being could raise the reporting limit anyway. Representatives Dina Titus of Nevada and Guy Reschenthaler of Pennsylvania have brought forth a bill which would mandate a change if the IRS failed to act on the matter. Titus has been advocating for this regulatory change, introducing bills in 2020 and 2022, albeit without advancing past the committee stage.

Recent developments, however, seem to suggest that pushing the Handpay Reduction Act  may be unnecessary. In November, the IRS Advisory Council recommended raising the threshold for automatic W2-G filings, potentially obviating the need for a new law.  Titus and Reschenthaler have lobbied the IRS to increase the reporting threshold for slot jackpot winnings. Last year, they introduced the Shifting Limits on Thresholds, or SLOTAct, to pressure the issue, proposing to elevate the tax threshold for slot winnings from $1,200 to $5,000.

Titus emphasized the importance of updating antiquated gaming regulations, not only for her constituents in Las Vegas but also for fostering legal gaming growth in local and Tribal communities nationwide, as conveyed to She highlighted how the outdated $1,200 standard imposes significant compliance burdens on taxpayers and operational costs on casinos nationwide due to inflationary pressures.

The IRS Advisory Council now endorses this proposal contained within the Handpay Reduction Act, suggesting a threshold of $5,800 to accommodate inflation properly. Furthermore, the Council advises the IRS to establish a mechanism for regularly adjusting this threshold to reflect inflation accurately. Time will tell how this plays out, but players should be optimistic about where this is moving.


Source link