Par. 2. Section 1.165-10 is revised to read as follows:
(a) In general. For purposes of losses from wagering transactions, a deduction is allowed under section 165(d) of the Internal Revenue Code for 90 percent of the amount of such losses during the taxable year, but only to the extent of the gains from wagering transactions during that year.
(b) Joint returns. In the case of spouses making a joint return, 90 percent of the combined losses of the spouses from wagering transactions during the taxable year are allowed as a deduction under section 165(d) only to the extent of the combined gains of the spouses from wagering transactions during that year.
(c) Applicability date. This section applies to taxable years beginning after December 31, 2025.