Leaders from the gambling industry are seeking to raise the threshold for reporting on bingo and slot machine jackpots, arguing that the current $1,200 threshold is obsolete. The gambling industry hopes to achieve their goal by appealing to the Trump Administration.
The American Gaming Association (AGA) contends that raising the $1,200 threshold for jackpot reporting which has remained the same since 1977 could help the casino industry. Jackpots have risen with inflation in the last few decades.
Bill Miller, the CEO of AGA, stated that such a change would be in line with the Trump Administration’s goal to reveal reform opportunities that would help drive up economic growth and job creation in the aftermath of the COVID-19 pandemic.
According to Miller, the casino industry has been in an economic freefall since the mid-March shutdowns prompted by the COVID-19 pandemic. More than 1,000 casinos have shut down across 43 states, and only some have reopened in the last week.
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Advocates for the gambling industry state that the $1,200 threshold is too small after inflation, and that the requirement to report all jackpots that reach that amount is a burden on operators.
Miller has long spoken for the necessity of raising the jackpot reporting threshold. The AGA encouraged the Department of Treasury more than a year ago to update the threshold in line with inflation.
IRS Will Also Benefit from Changes
Federal regulation states that, when a jackpot win of $1,200 or more is logged by a machine, the machine is taken out of commission until the time the winning player is able to accomplish a W-2G tax reporting form.
According to Miller, this is an excessive burden, both to the gambling industry, as well as the Internal Revenue Service (IRS). By increasing the threshold, says Miller, the IRS can conserve its enforcement resources on players who are likely to have net winnings at the end of the year, as well as reduce the interaction between players and employees during the filling out of tax forms.
According to Miller, the raising of the threshold is long overdue, and is backed by both sides of the aisle at Congress. Due to COVID-19 pressuring the gambling industry, the issue becomes more important to address without any further delay.