IRS confirms $2K slot jackpot threshold begins in ‘26

A long-awaited update to slot jackpot tax reporting included in the One Big Beautiful Bill Act will take effect in 2026, the Internal Revenue Service confirmed this week.

The updated minimum threshold of $2,000 for slot jackpots will begin Jan. 1, according to the federal agency.

The confirmation follows Monday’s posting of a draft IRS Form W-2G, reflecting changes mandated by the OBBBA, which was passed by Congress and signed into law in July. The law amended federal information-reporting requirements for certain payments, including casino gambling winnings.

In an email response to the Review-Journal, an IRS media spokesperson said the draft form reflects “the new information reporting thresholds implemented by Congress in section 70433 of the One Big Beautiful Bill Act” and confirmed the effective date.

Under current law, casinos must issue a Form W-2G to slot players who win $1,200 or more, a threshold that has not changed since 1977. Congress addressed the issue earlier this year by raising the information-reporting threshold under Internal Revenue Code sections 6041 and 6041A.

Industry groups and lawmakers have long argued the amount no longer reflects modern gambling or inflation. Gaming industry advocates have said raising the threshold would modernize the reporting system and reduce operational friction on casino floors.

Once the change takes effect, it is expected to reduce the number of mid-level slot jackpots that trigger mandatory reporting, particularly on modern machines where wins above $1,200 are common.

The statutory change does not apply retroactively and will not affect jackpots paid in 2025.

The IRS signaled that additional guidance is forthcoming. The agency’s 2025–2026 Priority Guidance Plan includes a project to draft regulations implementing the higher reporting thresholds under sections 6041 and 6041A, indicating that formal rules are still being developed.

An IRS spokesperson said additional updates will be issued as regulations are finalized.