The American Gaming Association Wednesday urged the Trump Administration to again heed its call and increase the IRS reporting threshold to $5,000 for slot machine jackpots.
The AGA said in a statement that its latest call was in response to President Trump’s executive order issued Tuesday dealing with regulatory reform to support the economic recovery from COVID-19. Some 989 commercial and tribal casinos temporarily closed throughout the country due to the coronavirus. The AGA reported Wednesday night that 100 have reopened.
Bill Miller, president and CEO of the AGA, said the change is needed as the gaming industry “safely reopens and seeks to return to financial health.
”The current threshold is outdated and imposes significant compliance burdens on both the IRS and the gaming industry,” he said.
In 2019, the AGA encouraged the Department of Treasury to update the $1,200 slot reporting threshold that has been in place since 1977. A threshold of $5,000 is a more “realistic level” and one that’s in line with inflation over that timespan, according to the AGA.
“The increased threshold would not only enable the IRS to focus its limited enforcement resources on those taxpayers who are most likely to have net slot winnings at the end of the taxable year, but would also significantly reduce close interactions required between gaming employees and patrons to issue tax forms,” Miller said in a statement. “This policy change, supported by bipartisan members of Congress was already long overdue prior to the pandemic, and now has additional importance as the gaming industry emerges from this crisis.”
When a slot player wins a jackpot of $1,200 or more, the machine is temporarily taken out of production while the patron fills out a W-2G tax reporting form. Since the threshold hasn’t changed since 1977, there’s been an increase in reportable jackpots.