A long-anticipated change to slot jackpot tax reporting will take effect on January 1, 2026, as confirmed this week by the Internal Revenue Service. The new law, enacted under the One Big Beautiful Bill Act (OBBBA), raises the minimum threshold for mandatory slot jackpot reporting from $1,200 to $2,000.
The updated threshold is reflected in a draft IRS Form W-2G, aligning with changes mandated by Congress and signed into law in July. This adjustment amends federal information-reporting requirements for certain gambling winnings, specifically those reported under Internal Revenue Code sections 6041 and 6041A.
Since 1977, casinos have been required to issue a Form W-2G to players winning $1,200 or more on slot machines. Industry groups and lawmakers have advocated for an update, arguing that the outdated threshold fails to account for inflation and the realities of modern gaming. Raising the threshold is expected to reduce the number of mid-level slot jackpots subject to reporting, streamlining operations for both players and casinos.
The statutory change is not retroactive and will not affect jackpots paid in 2025.
The IRS has indicated that more guidance is forthcoming, with its 2025–2026 Priority Guidance Plan including a project to draft regulations implementing the higher reporting thresholds. Additional updates will be released as these regulations are finalized.