AICPA Seeks Specific, Practical Guidance for Reporting Gambling Gains and Losses

Taxes | November 12, 2026

AICPA Seeks Specific, Practical Guidance for Reporting Gambling Gains and Losses

The AICPA has asked Treasury to provide guidance on the session method for substantiating wagering gains and losses.

Isaac M. O'Bannon

The American Institute of CPAs (AICPA) has asked the Department of the Treasury and the Internal Revenue Service (IRS) to provide guidance on the session method for substantiating wagering gains and losses. The AICPA submitted comments highlighting unresolved issues in proposed regulations that could affect taxpayers.  

While Treasury and the IRS have issued proposed regulations (REG-113229-25) addressing Section 165(d) and the rules governing Form W-2G, the proposed regulations do not address how taxpayers should measure, substantiate and report wagering gains and losses. Addressing these issues would improve administrability and reduce uncertainty for taxpayers.

The AICPA recommends that Treasury and the IRS issue guidance addressing the following:

  • Define a gambling session for purposes of measuring wagering gains and losses and provide a corresponding safe harbor.
  • Identify which records constitute adequate substantiation of wagering gains and losses under the session method, and confirm that account histories, win-loss statements, player activity summaries and similar records that gaming operators furnish to patrons may be relied on for that purpose.
  • Apply the session method to multiple types of wagering, including table games, horse racing, electronic gaming or other types of wagers.

“The AICPA is asking Treasury and the IRS to establish a consistent session-based approach that better reflects taxpayers’ economic gains and losses, clarify what records can substantiate those results and apply the approach across different types of wagering,” said Scott Klein, Senior Manager, AICPA Tax Policy & Advocacy. “The growth of online and mobile wagering and the new 90% limitation wagering losses have made clear, practical rules for reporting gambling gains and losses more important than ever. Without clear rules, taxpayers can face higher taxable income, reporting discrepancies and uncertainty over how to substantiate their activity.”

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Isaac M. O'Bannon

Isaac M. O'Bannon

Managing Editor

Isaac M. O'Bannon is the managing editor and digital content manager for CPA Practice Advisor (www.CPAPracticeAdvisor.com), drawing on two decades of experience covering the areas of professional accounting, taxation, business productivity and consumer technologies. . Prior to CPA Practice Advisor, O'Bannon was a consultant at firms in San Francisco, Denver and Tulsa, serving clients that included Logitech, Polycom, Hilti, Microsoft, the Stanford Research Institute, the University of Oklahoma's College of Engineering and other technology leaders. He is a U.S. Navy groundforces veteran (never a SEAL). Email: isaac.obannon - @ - cpapracticeadvisor.com . Isaac OBannon 2019 Cropped Small Headshot