An old and dysfunctional rule related to the threshold for reporting slot machine winnings may finally get updated in Nevada if legislators heed the call by Rep. Dina Titus.
Archaic Reporting Threshold
Titus, who introduced a bill to raise the reporting threshold last year but the bill did not find support to progress, is now determined to take it this time over the line and offload a significant amount of paperwork for casinos, as well as frustration for customers waiting for their winnings to be processed.
“There was a time when we were trying to get the Treasury Department to do this through regulation, but they never moved, so we’re just going to push the legislation instead,” Titus said as reported by the Review-Journal.
According to the current policy that was adopted back in 1977, a jackpot win in excess of $1,200 should be reported by the operator – be it a casino, tavern, restaurant, convenience store, or even airport personnel –via a W-2G form filing to the Internal Revenue Service (IRS).
Titus, a co-chair of the Congressional Gaming Caucus, is convinced that this “archaic” threshold should be updated to reflect the dramatic changes in the landscape over the 46 years since it had been first implemented and cut down the paperwork burden for operators.
She calls for bipartisan support for her proposal aiming to raise the reporting threshold to $5,000 and index it to the annual inflation and believes it could receive support from states that have some form of commercial or tribal gaming. Moreover, she is determined to make it a cause in the caucus as not just Las Vegas (her legislative district includes the Strip), but everybody will benefit from it.
‘Drain on the Consumer’
Currently, when a player hits a jackpot on a slot machine, the procedure requires the machine to be taken offline after the attendants have checked it and verified the winner’s identification. But there are places where it may take a while for the process to begin due to casino or other personnel being occupied with other responsibilities, leaving patrons waiting, sometimes for hours.
“It certainly is a drain on the consumer,” said Alex Costello, vice president of government relations for the American Gaming Association (AGA), outlining that the process “takes a little air off the tires and it certainly is a compliance headache” for operators.
According to the last available statistics referring to 2020, there were more than 15 million W-2G forms filed with the IRS, and now, as the sector is recovering from the pandemic lows, the number of jackpots to be won is likely to go higher.
Titus said that if the measure is a high enough priority for most members of Congress, the proposal should make it through the House, and from there on she expects senators representing Nevada to take the initiative and win Senate approval.