Pro poker player says new tax laws forced him into semi-retirement

Professional poker player Erik Seidel says he chose to semi-retire this year — but not because his career was slowing down.

Seidel played his first major tournament in 1988, finishing as runner-up in the World Series of Poker main event. He became a full-time professional poker player in 1995, and over the course of his career has racked up winnings of more than $48 million playing in live poker tournaments, according to the Hendon Mob Poker Database, an online compendium of poker stats.

In recent years, the 66-year-old estimates he’s played roughly 130 to 150 events a year, including times he’s bought back in after being eliminated. Last year, his total tournament winnings topped $2.8 million, according to Hendon Mob.

But this year, he says, he plans to play maybe a quarter of the tournaments he usually plays, and virtually no “high-roller” events, which cost $25,000 or more to enter. The reason is simple, he says: taxes.

President Donald Trump’s One Big Beautiful Bill Act, which passed last July, includes a provision that changes the way gamblers can deduct losses. Taxpayers still must treat gambling winnings as income, but they can no longer use all of their losses to fully offset their winnings. Rather, starting in tax year 2026, they can only deduct up to 90% of their losses.

That’s left some professional players wary of spending too much money to play, lest they find their profit completely eroded by the 10% disparity in the tax rules, says Russ Fox, an enrolled agent and principal at Clayton Financial and Tax, a firm which specializes in gambling tax.

Fox says several of his clients are professional poker players who had to stop because “the margins are just too small.” For most professionals, the 90% loss limitation is “going to have a major impact,” he says.

In Seidel’s case, he says, it’s enough of a potential impact for him to cut back.

“The margins are really, really thin. If you’re a professional poker player, you’re not even guaranteed to have a profit at the end of the year,” he tells CNBC Make It. “This just creates a situation where it’s really untenable. Even the elite players, they can’t overcome it.”

Amateur gamblers likely won’t notice anything different when the law takes effect next year, since most of them “lose significantly,” says Fox.

But those who play in high volumes and turn a profit or break even will feel the impact, he says.

Say a poker player pays realizes $100,000 in winnings over the course of the year, but also incurs $110,000 in losses. In previous years, that player could deduct their losses to the extent that they offset their winnings and owe no income tax. Under the new rules, however, the player could deduct only $99,000, meaning they’d owe tax on the $1,000 difference.

“You’re taxing people on money they didn’t make,” says Doug Polk, a high-stakes professional poker player and ambassador for poker training site ClubWPT Gold.

Rules like these, often considered “sin taxes,” are meant to serve a dual purpose, say analysts at the Budget Lab at Yale University. “On the one hand, they aim to discourage harmful behavior by making the behavior more expensive, while on the other hand, they generate substantial revenue that can fund essential services,” they wrote in a February note.

The Joint Committee on Taxation estimated that the provision would generate $1.1 billion in tax revenue over eight years, though that number could shrink as gamblers’ behavior is forced to change, according to a 2025 analysis from the Tax Foundation.

Polk says you can picture the distribution of gamblers’ results on a bell curve, with the peak of the curve centered around a slight loss, because places where you might gamble, such as casinos or card rooms, take a small cut of every pot. Even many pros, he estimates, hover around the middle of the theoretical curve.

“Essentially, most people that are winning gambling will be small winners,” Polk says. Under the previous rules, a high-volume gambler could earn a living winning 51% or 52% of the time, he says, but the new law skews the math heavily against that kind of player.

Polk estimates that the majority of gamblers who don’t have other sources of income, such as sponsorships or social media channels, will either fail to turn a profit under the new rules or begin playing in more off-the-books games.

“It’s basically a game-ender for people that are in high-volume gambling fields who do not have substantial, substantial edges,” he says. In gambling parlance, an “edge” refers to the advantage a bettor has over other players or over oddsmakers. Casinos make money over the long term by having a relatively thin edge — blackjack, for instance, generally has a house edge of less than 1%.

Even for veteran players like Seidel, consistently finding an edge against other world-class players can be tough, he says. Add in a 10% tax drag — on not only gambling losses but also on travel and lodging expenses for gambling events — and aiming for major profits becomes too much of a risk, he adds.

“I’m going smaller because I don’t want the numbers to get too high if I’m only able to deduct 90%,” says Seidel, who’s based in Las Vegas. “I’ve just been really taking it easy and avoiding $10K [buy-in tournaments] and above, which are the tournaments that I normally play, and not traveling as much this year.”

Because Seidel has had a long and successful career, he can withstand a small sabbatical, he says. “I can afford to not play as much, but it’s a devastating thing for people who are much younger than me,” he says.

Fox says he’s had some difficult talks with his clients who make a living as professional gamblers.

“I’m telling clients to basically run their numbers from 2025 and limit their gambling losses to 90% and assume that was your 2026 number to see what the impact would be,” he says. “And a few have been very surprised. Not in a positive manner.”

For players who don’t work with a tax professional and who aren’t as proactive about their taxes, that surprise might be delayed until tax time next year — and potentially costly, says Polk.

“You’re not really going to see people realize, ‘Oh God, this is going to be bad’ until the tax man starts knocking,” he says.

Polk expects to see some impact on how players approach the game in 2026, “but a more substantial one next year, when people actually get the sticker shock of it.”

For now, Seidel is one of the few prominent players to announce a step away from the action. Others, like Polk, have been advocating for the law to be overturned. Several bipartisan bills have been introduced to Congress to repeal or modify the provision, including multiple efforts from Sen. Catherine Cortez Masto, D-Nev., who sat for an interview on Polk’s YouTube channel in July. So far, none have made it to a vote in either chamber.

“It’s going to have an impact throughout gambling, which is why I am certain this law will be repealed one day,” says Fox. However, it may take a while, he says: “Don’t ask me if it will be 2026 or 2036.”

Natalie Wu contributed reporting.

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