Instead, how about we pass a law that guarantees a living wage, so that workers don’t have to depend on tips?
Silly me. That would be COMMUNISM.
What it means?
Absolutely nothing because the upcoming One Big Beautiful Bill will absolutely destroy the economy for the people who get tips on a regular basis.
If enacted, workers could deduct all “qualified tips” from 2025 through 2028. Tips must be reported to qualify for the deduction.
In 2023, there were roughly 4 million U.S. workers in tipped occupations, representing 2.5% of all employment, according to estimates from The Budget Lab at Yale University.
“This is a very narrow subset of the workforce,” said Alex Muresianu, senior policy analyst at the Tax Foundation.
“For the lowest income tipped workers, it provides no marginal benefit” Muresianu said. “It would benefit moderate to middle income workers substantially.”
also from another article:
limited to cash tips that workers report to employers for withholding purposes on payroll taxes.
So many caveats it’s practically worthless.
So many caveats it’s practically worthless.
For normal workers who make tips…
For a 14 year old masseuse who works at a golf course getting a “tip” to stay quiet…
Well, they’ll get less from the person tipping them than they used to, but value it as more because they don’t pay taxes now.
Rich people are going to tip less, and get treated better for it. That’s the savings they’ve always meant, they’ll be able to tip less and still get the treatment they want.
It’s also apparently tied to banning states from enacting AI regulations.
I am not familiar with any of the tipping laws, but what prevents an employer (now) to withhold the tipping jar from employee’s wages, especially now, under the norm of non taxed, in effect non official, incomes?
So, before one would get (income+tips) - taxes; and now only Income - Taxes because on paper the tips don’t exist?
Gas station pumps with mandatory tips is what it means.
