Why I’m avoiding the sportsbooks right now

Americans are expected to legally wager between $1.5 billion and $1.75 billion on Super Bowl LX this year between the New England Patriots and the Seattle Seahawks. And that estimate was reached before Houston furniture salesman Jim “Mattress Mack” McIngvale wagered $2 million on a Patriots victory.

With that in mind, I offer one small caveat before getting into why I’m (mostly) avoiding the sports books for now. I’ll avoid them, except for the Super Bowl. I really like the Seahawks to win, and win big. I’m envisioning a blowout the likes of Seattle’s 43-8 throttling of the Peyton Manning-led Denver Broncos back in 2014.

But once that’s done, I’m stepping away. At least for a while.

For all the hemming and hawing about how legal betting has become too pervasive — Kalshi, which is technically considered a prediction market, basically allows you to bet on just about anything — that’s not why I’m hitting the pause button.

It’s for several reasons, among them: taxes.

I just received my tax records from the Seminole Hard Rock and MGM, the two gambling operators where I place most of my bets. What these records tell me is simple — even if I had broken even, or managed a nominal profit on my bets, I still lose.

Under President Donald Trump’s One Big Beautiful Bill, a sweeping tax package he and supporters herald as, well, beautiful, there is a provision creating what some have taken to calling a “phantom income.”

Effective this year under the bill, bettors can only deduct 90% of their losses. Previously, those who wagered could deduct all of their losses. What the change means is that, even if a gambler who nets zero for the year, meaning for example they won $100,000 but also lost $100,000, they would only be able to deduct $90,000 as losses, leaving $10,000 in taxable income.

Most hobby betters, such as myself, don’t wager that much, but the effect is similar even if on a smaller scale.

On a larger scale, it’s spooking some of the gambling greats, such as poker legend Erik Seidel, a Hall of Famer and 10-time World Series of Poker bracelet winner. Seidel has said the new tax law is, at least partially, driving him away from the game.

To be sure, I’m nowhere near as good at sports betting as Seidel is at poker, but I get the frustration. How can you be taxed on imaginary impact?

And it’s not just that. There is an alarming and increasingly apparent level of corruption among athletes providing insider knowledge to bettors who then use the information to place prop bets. Think of it like insider trading, but with sports betting.

Last Fall, the Department of Justice named seven NBA contests as part of an indictment into the activities, and now federal prosecutors are investigating possibly even more.

For the uninitiated into the sports betting world, prop bets are niche. One can place a wager on, say, how many three-pointers an NBA player sinks or how many passing yards a quarterback will (or won’t) have. Prop bets can even get quirky, with wagers on things like how long the National Anthem will last or what color Gatorade will be dumped on the winning coach at the end of the big game. It’s fair to say it borders on ridiculous, but it’s fun!

Still, because these prop bets are focused on isolated aspects of the game that individual players can often control, it’s simply too easy for a player to take a dive to game a prop. Just ask Terry Rozier, who was charged earlier this month on a points-shaving scheme to throw prop bets.

None of this is to say I believe that entire games are being thrown. But it is safe to say that some individual performances may not be 100% reliable, or authentic.

On top of the insider betting issue, there’s also a questionable recruiting scheme within what has become a cesspool in the Amateur Athletic Union (AAU). Kids in middle school are being recruited and signed to college teams. The AAU has also skirted bans on gifts to players, filtering perks through boosters in what has become a corrupt system.

Meanwhile, “name, image and likeness” policies, known as NIL, and the transfer system have created a sort of mercenary system, where top players can contract shop bigger deals. Former University of Tennessee Volunteers Quarterback Nico Iamaleava, for example, entered into contract negotiations with the school seeking a more lucrative NIL deal despite his current agreement paying him about $2 million per year. That’s for a college athlete.

While Iamaleava has since said his eventual move to UCLA was not a decision driven by money, it’s still a number you should let sink in. Whether Iamaleava jumped the Tennessee ship for money doesn’t change the fact that money was at play, and when top sports stars at that level enter the pros, they’ve already got a taste for the cash flow that comes with sports fame. And they may look for ways — even illicit — to increase that cash flow.

It’s hard enough to beat the books without a flawed tax system, scandalous recruiting practices and corrupt players. Add those things in, and the odds are not “ever in your favor.”

And now there’s one more thing: AI.

Artificial intelligence is being deployed in a number of useful ways in the sports world, including analytical insights that help players avoid injury. But there are unintended (or perhaps intended) consequences in the sports betting realm.

Match fixing in lower-level leagues has become pervasive, while also infiltrating sports like basketball through game rigging in ways more difficult to identify, meaning the bad actors are less likely to get caught. Both the nefarious betters and the officials investigating them are armed with AI tools to detect betting discrepancies, creating a constant chase between the good guys and the bad guys (or gals) as technology evolves.

So yeah, taken together, all of these challenges present an excellent case for hitting the sports betting pause button. In this case, I’m a jury of one and, as my own foreman, I find the system guilty of foul play.

My hope is that reform is possible, and I can hit the sports books again soon.