VIA Electronic Submission May xx, 2021 Internal Revenue Service Attn: CC:PA:LPD:PR (Notice 2021-28) Room 5203 P.O. Box 7604 Ben Franklin Station Washington, D.C. 20044 RE: Notice 2021-28; Recommendations for 2021-2022 Priority Guidance Plan Dear Sir or Madam:
On behalf of its members, the American Gaming Association (AGA) and the National Indian Gaming Association (NIGA) are pleased to submit the following recommendation for items included in the 2021-2022 Priority Guidance Plan. We appreciate the opportunity to provide input to Internal Revenue Service (IRS) and Treasury on a matter of continued importance to the gaming industry, and urge you to consider the following as part of the process: • Final guidance on corrective actions available to the Treasury Department and its regulatory authority under section 7805 of the Internal Revenue Code to update the dollar threshold for tax information reporting for slot machine jackpots under current Treasury Regulation § 1.6041-10. Background: The current threshold for tax information reporting for slot machine jackpots was set at $1,200 in 1977 through regulation and has not been updated since then. A $1,200 jackpot in 1977 would be equivalent to more than $5,000 today if adjusted for inflation. As the value of a $1,200 jackpot has decreased, the number of jackpots hitting that threshold and requiring reporting has increased. The current, outdated threshold imposes significant compliance burdens on both the IRS and the gaming industry – an economic driver in communities across the country that has been significantly impacted during the pandemic due to mandatory closures to protect public health and safety. Having to take a slot machine temporarily offline to issue a tax reporting form removes a limited asset from production. Modernizing the threshold would promote operational efficiency for gaming operations and customers and enable the IRS to focus its limited enforcement resources on those taxpayers who are most likely to have net slot winnings at the end of the taxable year. Members of Congress have recognized the negaimpact of a static and antiquated reporting threshold, which is why they have previously written to Treasury urging the Department to provide regulatory relief. Most recently, the Consolidated Appropriations Act of 2021, signed into law (Public Law No: 116-260) on December 27, 2020, directed Treasury to report to
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