Jackpot tax on slots to increase until 2026

The IRS has now released updated confirmation that the casino slot jackpot tax will nearly double in 2026.

A post by X from Vital Vegas states, “Sources say the IRS will officially confirm that the threshold for reporting slot jackpots is increasing from $1,200 to $2,000, effective Jan. 1. Now, mad casinos to implement the change.

The One Big Beautiful Bill Act (OBBBA), which was announced in July this year, states that a measure will be introduced to increase the minimum amount that must be accounted for when winning a slot machine jackpot.

Now a sum of $2,000 (£1,500) will come into force on 1 January 2026 and is expected to increase each year in line with inflation.

Casinos are now rushing to implement the change

The previous threshold of $1,200 (£900) has been in place in casinos since 1977, marking the first significant change in almost 50 years.

Until 1^St as of January 2026, casinos were required to hand over slot winnings for prizes of $1,200 or more under the federal tax code. As such, the player is issued a W-2G tax form to report all gambling winnings, and it is then filed with the IRS.

For calendar years after 2025, the minimum threshold amount for reporting certain payments and backup withholding on certain information returns, including Form W-2G, will be adjusted annually for inflation. The minimum threshold amount for payments made in calendar year 2026 is $2,000,” an IRS document said about the early 2026 change.

This increase took months to be officially confirmed, leaving thousands of casinos required to update regulations for the new $2,000 threshold.

This can take time, which means casinos may not be in compliance with the January 1st date for the IRS to update this threshold.

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