New York’s tax bill came up again this week when Sen. Tom O’Mara pointed to a Citizens Budget Commission finding that the state and its local governments collected more taxes per person than any other state in fiscal 2024, 71% above the national average. For anyone who cashed a jackpot at del Lago in Tyre or the racino in Farmington this year, there is one more wrinkle waiting at tax time, and this one comes from Washington.
Starting with 2026 winnings, the federal government lets you deduct only 90% of your gambling losses. New York has not followed. That means the same year at the slots can produce two different answers on two different returns. A gambling tax calculator built on the new federal rules handles the first of those answers; New York’s graduated brackets, from 4% to 10.9%, mean the state side still takes some pencil work.
What Washington changed
The One Big Beautiful Bill Act, signed July 4, 2025, trimmed the gambling loss deduction from 100% to 90% of losses, still capped at what you won. It applies to the 2026 tax year, the return you file in spring 2027.
The law also raised the thresholds for the tax form casinos issue on big wins. Slot and bingo jackpots now trigger it at $2,000 instead of $1,200, keno at $2,000 instead of $1,500, and long shot wagers paying 300 times the stake or more at $2,000 instead of $600. Poker tournament wins stay at $5,000. Fewer forms will get printed in Seneca County as a result. The winnings below those lines are still taxable income; there’s just less paperwork reminding you.
Albany is still using the 2017 rulebook
New York decoupled from the federal gambling loss rules years ago. The state’s own instructions for its itemized deduction form say the New York deduction for gambling losses is calculated under the federal rules that applied in tax year 2017: losses up to the amount of your winnings, with no haircut.
New York also lets you itemize on the state return even if you take the standard deduction on your federal one. That detail matters here, because the state’s standard deduction for a single filer is $8,000, about half the federal figure of $16,100. A Finger Lakes homeowner with a property tax bill can clear $8,000 without much trouble.
The state could still change course before the 2026 forms come out. Nothing on the books today points that way.
One player, two returns
Picture a Waterloo retiree, single, who hit $6,000 in slot jackpots at del Lago over the year and lost $6,000 getting there.
On the federal return, that retiree probably takes the $16,100 standard deduction, because $6,000 of losses plus a modest property tax bill won’t beat it. So the losses do nothing, and the full $6,000 of winnings is added to income. Even a federal itemizer could only deduct $5,400, leaving $600 taxed as profit on a year that broke even.
On the New York return, the same retiree can itemize, deduct the full $6,000 in losses against the $6,000 won, and see the gambling cancel out on the state side.
A winning year shows the same split. Say a Geneva poker player finishes with $15,000 in wins and $9,000 in losses, a real $6,000 profit. A federal itemizer can deduct only $8,100 of those losses, so Washington taxes $6,900. Albany, using its older rule, taxes the $6,000 the player actually made. The $900 gap is small on its own, but it compounds for anyone who plays most weekends.
Big wins come with New York withholding
When a win is large enough to require federal withholding, New York takes its own cut on the spot. State regulations set that withholding at the highest state rate, 10.9% for 2026, with no allowance for deductions. That money is a prepayment, not the final bill, and some of it may come back once both returns are done.
One number tends to get mixed into all this: the 51% tax New York charges on mobile sportsbook revenue. That is a bill the state’s eight licensed sportsbooks pay on their own revenue, not a tax on your winnings.
Congress could still undo it
On September 16, the House Ways and Means Committee voted 38 to 5 to advance a bill that would restore the full federal deduction. It still has to clear the full House and the Senate before it reaches the President, and the House is out until after the November election. Until something passes, plan on the 90% rule.
Before you file
Keep a session log with the date, the venue, what went in and what came out. Both the IRS and Albany expect that record from anyone claiming losses. Ask del Lago or Finger Lakes Gaming for a year end win/loss statement if you play on a rewards card. Sports bettors can download the same kind of yearly activity statement from their app account. Then run the federal side and the state side separately, because this is the first year in a while where they won’t match, and the gap gets wider the more you play.
If gambling has stopped being entertainment, the NYS HOPEline is free and confidential at 1.877.8.HOPENY, or text HOPENY (467369).
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