IRS Eases Payment Reporting and Gambling Loss Limits
Published Date: 4/17/2026
Proposed Rule
Summary
The IRS wants to raise the dollar amount that triggers reporting payments to certain payees, making it easier for businesses to handle paperwork. They’re also tweaking rules about how much you can claim for gambling losses. These changes affect businesses and gamblers and could save time and hassle starting after the rules are finalized, with comments due by June 16, 2026.
Analyzed Economic Effects
5 provisions identified: 4 benefits, 1 costs, 0 mixed.
Reporting Threshold Raised to $2,000
If you make payments in a trade or business, you generally do not have to file information returns for a payee unless your payments to that payee in a calendar year equal or exceed $2,000. That $2,000 base threshold applies for calendar year 2026 (payments made on or after January 1, 2026) and will be adjusted for inflation in later years.
Estimated $982M Filing Burden Savings
The IRS estimates that raising the reporting threshold will reduce filing burdens and save about $982 million in 2024 dollars for calendar year 2027 (returns for tax year 2026). This estimate reflects fewer Forms 1099-MISC, 1099-NEC, W-2, W-2G, and 945 filings.
Gambling Winnings Reporting Raised
Winnings from bingo, keno, and slot machine play must be reported only if the winnings meet or exceed $2,000 for calendar year 2026. The $2,000 threshold for 2026 applies to those payments made on or after January 1, 2026, and is indexed for inflation in later years.
Wagering Loss Deduction Reduced to 90%
If you claim an itemized deduction for wagering losses, the deduction is limited to 90 percent of your wagering losses for the taxable year and only to the extent of your wagering gains. This rule applies to taxable years beginning after December 31, 2025.
Backup Withholding Tied to $2,000 Threshold
Backup withholding for reportable payments under sections 6041 and 6041A is generally required only when a payee's aggregate payments in a calendar year exceed the dollar threshold in effect under section 6041. For calendar year 2026, that threshold is $2,000 for payments made on or after January 1, 2026.
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Key Dates
Department and Agencies
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