UFC's Dana White Urges Trump to Reverse New 90% Cap on Gambling Loss Deductions

UFC President Dana White sent a letter to President Donald Trump this week, urging him to push for the reversal of a new tax provision that limits the deduction of gambling losses to 90%. The rule was included in the One Big Beautiful Bill Act (OBBBA), a sweeping tax reform package signed into law in 2025 that has drawn criticism from the legal sports betting community. In the letter, which was first reported by an independent journalist and later authenticated by ESPN, White praised the overall tax bill but argued that this specific provision is already “creating problems.” The change fundamentally alters how gambling winnings and losses are treated for tax purposes. Previously, taxpayers could deduct gambling losses up to the full amount of their winnings. For example, a person who won $100,000 and lost $100,000 in a year would have a net taxable gambling income of zero. Under the OBBBA, that same person can now only deduct $90,000 (90% of their $100,000 in losses), leaving them with $10,000 of taxable income despite having broken even. This new 90% cap creates phantom income scenarios that can catch both casual and professional bettors by surprise. The previous system of netting winnings and losses to zero was straightforward, but the current law can generate a tax liability even for someone who breaks even over the course of a year, a counterintuitive and potentially costly outcome. White argued in his letter that the new law makes it “irrational to bet in the United States because you could end up owing taxes even when you lose or having a tax bill that exceeds your winnings for the year.” He warned that the policy could have several negative knock-on effects, including undermining another of the president’s signature policies, the “No Tax on Tips” initiative. “Gamblers who win big, tip big, but now that this 90 percent limitation exists gamblers are likely to be less generous if they even gamble at all,” White wrote. This could directly harm service industry workers in states like Nevada, whose livelihoods are often supported by tips from the gaming and hospitality sectors. Beyond the impact on individual bettors and workers, White contended the rule harms the broader sports and entertainment ecosystem. “The UFC supports a healthy, legal sports betting market to drive fan engagement, broadcast value, and sponsorships,” he stated. “When legal betting is discouraged, it hurts the ecosystem we’ve spent years building in partnership with state regulators and licensed operators. It also undercuts the transparency and integrity protections that legal betting provides for professional sports.” In our experience, these kinds of legislative tweaks are where many taxpayers run into trouble. The tax code is a minefield, and a change like the loss deduction cap underscores the critical need for proactive tax preparation and compliance to avoid unexpected bills. Without meticulous record-keeping and a clear understanding of how to apply the new limitation, individuals could face a significant, unforeseen tax burden. Navigating these rules is precisely the challenge C&S Finance Group LLC helps clients manage at csfinancegroup.com. The concerns raised by White are not new. Since the OBBBA was passed, advocates in the gaming industry and some lawmakers have been working to reverse the provision. Shortly after the bill’s passage, U.S. Rep. Dina Titus of Nevada introduced the Fair Accounting for Income Realized from Betting Earnings Taxation Act, a bill aimed at repealing the 90% cap. However, the legislation has not yet advanced through Congress for a vote. White’s high-profile appeal appears to have renewed attention on the issue. According to the prediction market platform Kalshi, the odds of the cap being repealed this year jumped from 20% to 37% immediately after the letter was made public, before settling back to around 29%. This indicates that while traders see a repeal as a long shot, White's intervention has made it a more plausible outcome. Ultimately, the debate highlights the tension between federal revenue goals and fostering a rational economic environment. This provision may have the unintended consequence of stifling a legal, regulated industry, which is rarely a productive outcome for the broader economy or for tax compliance. White concluded his letter by framing the reversal as a “common-sense” fix and an opportunity for the president to stand up for “fighters, fans, and American businesses.” It remains to be seen whether the White House will act on White’s request and pressure Congress to amend the law. Any change would require legislative action, and with Rep. Titus’s bill stalled, the path forward is unclear. The response from the administration and congressional leaders in the coming weeks will be closely watched by the gaming industry, professional sports leagues, and millions of American taxpayers.