As the days go on, more casinos around the United States are beginning to open back up. The American Gaming Association is now working to change the requirements set on gamblers to pay taxes on casino jackpots. If all goes according to plan, US casinos will only report jackpot winnings above $5,000.
Many feel this is long overdue. Since 1977, any casino winnings over $1,200 have needed to be reported as taxable income. 2020 might be the year that this changes.
Let’s take a look at what the AGA has planned.
The US Casino Industry is Coming Back to Life
Prior to March, the land-based casino industry in the United States was thriving. Over the past two months, however, this industry has been struggling to stay alive. Fortunately, things may be starting to rebound.
Every single state is now beginning to lift its restrictions. Some have officially begun allowing their casinos to reopen. That includes Louisiana, where some of the biggest casino-resorts in the state will soon reopen to the public.
In some parts of the country, casinos are opening up without the blessing of state leaders. In California, for example, many Native American-run casinos have already opened their doors. These venues sit on sovereign land and do not need to abide by state regulations.
Some states are taking their time allowing casinos to open up again. Nevada is not allowing this to happen until specific safety measures are set in place. Based on what’s being said, the majority casino-resorts in Las Vegas will begin opening back up in June.
For many casino companies, reopening gaming venues is a complete necessity. Some may not last very long unless their casinos start operating again. It’s still not entirely clear how much revenue the US casino industry will manage to generate over the next few months.
Now, one of the most powerful gambling groups in the country is asking the government to make a major change.
Gamblers May No Longer Need to Pay Taxes on Casino Jackpots Below $5,000
As most casino gamblers already know, anyone with jackpot winnings above $1,200 needs to be given a W-2G tax form. These winnings are considered taxable income. For many years, the American Gaming Association has called for the Treasury Department to change this so that only winnings above $5,000 are taxed.
Officials within this group claim that, when adjusted for inflation, $1,200 back in 1977 amounts to about $5,000 today. They also believe that requiring such a small amount of money to be taxed causes unnecessary burdens on the IRS. Bill Miller, President and CEO of the AGA, spoke about this situation to the media this week.
“As the gaming industry safely reopens and seeks to return to financial health, one critical area of regulatory reform the administration should consider is modernizing the $1,200 slot jackpot reporting threshold, which has been in place since 1977,” Miller said. “The current threshold is outdated and imposes significant compliance burdens on both the Internal Revenue Service and the gaming industry.”
This change is apparently being supported by many members of Congress. The Trump Administration, currently looking at new ways to save the Federal Government money, also seems to support this idea. It may end up helping the casino industry more than we realize.
The AGA has asked for a change to the way people pay taxes on casino jackpots for years. Now, it appears this decision will be approved. We’ll give an update on what casino companies feel about these proposed regulations over the next few weeks.
Las Vegas Casinos Prepare to Open in June
All parts of the US have been affected by the spread of the new coronavirus. From an economic standpoint, Las Vegas is one of the worst-hit areas. This city has been essentially shut down for months and hundreds of thousands of residents have been left without work.
Las Vegas relies heavily on its tourism and gambling industries. Unfortunately, both have been shut down since March. All of the casinos here are closed and tourism is at an all-time low.
Everyone recognizes that something needs to change. Nevada is set to enter into Phase 2 of reopening soon and the current plan is for casinos in the state to begin reopening in June. That includes venues such as The Venetian and The Bellagio.
Some travel experts believe now may be the perfect time to visit Las Vegas. That may be even more true if gamblers aren’t required to pay taxes on casino jackpots below $5,000. No one knows how things will turn out over the summer, yet casino companies are doing everything they can to attract more visitors to Las Vegas.
Do you think the AGA’s new plan makes sense? Are you planning to visit Las Vegas anytime soon? Let us know in the comments section below!