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SB 183

AN ACT ESTABLISHING A PERSONAL INCOME TAX DEDUCTION FOR CERTAIN GAMBLING LOSSES.

2026 Regular Session Introduced by Mike Demicco and 2 co-sponsors

Connecticut bill would let residents deduct gambling losses from state income taxes, reducing tax revenue while potentially encouraging gambling activity.

REF. TO JOINT COMM. ON Finance, Revenue and Bonding
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Bill Summary · SB 183

Legislative bill overview

SB 183 would create a personal income tax deduction allowing Connecticut residents to deduct certain gambling losses from their taxable income. The bill specifically targets losses incurred through legal gambling activities in the state. This represents a significant shift in tax policy regarding gambling-related expenses.

Why is this important

Currently, federal tax law allows gambling loss deductions only for professional gamblers and only to the extent of gambling winnings—a limitation Connecticut residents must follow on state returns. This bill would potentially expand tax relief for recreational gamblers, affecting state revenue and reshaping the tax treatment of gambling compared to other discretionary expenses. It also reflects ongoing policy debates about how states incentivize or regulate gambling activity.

Potential points of contention

  • Revenue impact: The deduction could substantially reduce state income tax revenue, requiring either budget cuts or tax increases elsewhere to offset losses
  • Fairness and moral hazard: Critics may argue the deduction incentivizes problematic gambling behavior and creates inequitable treatment compared to other discretionary losses (medical expenses, investment losses), while potentially harming vulnerable populations
  • Defining "certain losses": The bill's language about "certain gambling losses" leaves unclear which types of gambling qualify, creating potential implementation and compliance challenges
  • Federal-state coordination: The deduction conflicts with federal tax code, potentially creating complex dual-filing requirements and administrative burden for taxpayers

Compiled from official sources — confirm details with the bill’s official record.

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