Nationwide Slot Machine Jackpot Threshold Should Rise to $5,000, Argues Nevada Legislator
A federal legislative proposal, spearheaded by a Nevada Congresswoman, aims to boost the reporting limit on slot machine wins from $1,200 to $5,000 across the nation.
Representative Dina Titus (D) believes the current system is outdated, contending it's cumbersome for casinos, players, and the Internal Revenue Service (IRS).
The existing reporting scheme was enacted in 1977, but adjustments for inflation were apparently overlooked. As per DollarTimes.com’s inflation calculator, $1,200 equivalent value today would be approximately $6,120.
When a player's slot jackpot exceeds $1,200, the machine halts play, and staff must verify the player's ID, issue a W-2G form to the IRS, and authenticate the jackpot's accuracy by inspecting the machine.
Casinos and similar establishments are unique in having to momentarily halt their primary assets for tax purposes, as highlighted by the American Gaming Association (AGA).
Tolerance Limit
In the year 2020, over 15 million W-2Gs were filed, according to AGA statistics, even though casinos were intermittently closed due to the pandemic.
Some players have to endure wait times of an hour or two before the paperwork can be completed. There are tales of slot jackpot winners at Harry Reid International Airport missing their flights due to the delay.
Titus thinks it's time to act. Besides raising the threshold, her bill proposes annual adjustments to keep pace with inflation.
“We tried to persuade the Treasury Department to make these changes through regulations, but they never acted on it, so we're resorting to legislation instead,” Titus stated to The Las Vegas Review-Journal. “It's crucial to note that we're not just advocating for Las Vegas; we're advocating for everyone.”
Bipartisan Backing?
Titus anticipates minimal resistance to the proposed legislation and expects bipartisan support, given the legislation's priority status.
The bill has the support of the AGA, which, in 2016, managed to thwart an IRS initiative to lower the threshold to $600. The revenue service aimed to employ player loyalty cards to electronically monitor wins to facilitate the proposed regulation but was convinced to reconsider.
“This threshold was set back in the '70s, and we all know how inflation operates and what it looks like now,” Alex Costello, vice president of government relations for the AGA, informed the Review-Journal. “Back then, a $1,200 jackpot held a completely different significance than it does today.”
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