US Senate passes ‘no tax on tips’ bill in unanimous vote (www.theguardian.com)

submitted 1 week ago by [email protected] to c/[email protected]

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Bipartisan bill to created tax deduction of up to $25,000 now goes to House but experts have criticized measure

The US Senate passed the No Tax on Tips Act on Tuesday after the Nevada senator Jacky Rosen brought the bill up for a unanimous consent request.

The bipartisan bill will create a tax deduction of up to $25,000 for cash tips reported to employers by workers for withholding purposes on payroll taxes, with a cap on the salary for eligible workers at $160,000 annually.

Economists and labor advocates have criticized the legislation, with concerns it will incentivize the expansion of tipped work, undermine pay increases and would affect only a small segment of about 5% of low-paid workers who receive tips.

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[-] [email protected] 39 points 1 week ago

Just some napkin math, if you make $50k a year and reached the $25k threshold you'd get back about $5k in taxes. Not nothing, but they're also gonna make it harder to get SNAP and Medicaid benefits. If you don't qualify (i.e. jump through every hoop) for the latter that $5k is gone and then some. People are about to get more stingey with tipping too I imagine.

[-] [email protected] 15 points 1 week ago

People are about to get more stingey with tipping too I imagine.

I'm going to be avoiding places that tips expanded into to subsidize wages entirely. Sit down restaurants will still get tips until we can get rid of them entirely, but that's it.

[-] [email protected] 9 points 1 week ago

If a restaurant is gonna say "20% is the new 18%" I'm not gonna budge. It's a percentage. Food goes up then so does the tip.

[-] [email protected] 5 points 1 week ago* (last edited 1 week ago)

I've always done 20% because it is easier back when 15% was the norm and in the vast majority of cases it was less than $1 difference. You are right that there is no reason to increase the percentage when the prices are rising anyway.

Also, basing the tip on the food cost is a stupid system in the first place. The waitress at the diner where a meal costs $10 is doing just as much work as the one at the high end restaurant that charges $50.

[-] [email protected] 29 points 1 week ago

I have a tip for you. For free: your government is phenomenally stupid.

[-] [email protected] 3 points 1 week ago

That’s a lot of governments.

[-] [email protected] 11 points 1 week ago

Tackling the real problems here. /s

[-] [email protected] 10 points 1 week ago* (last edited 1 week ago)

This will certainly not be abused in any way shape or form...

[-] [email protected] 9 points 1 week ago

Sometimes you can simply not report the tips at all, particularly cash tips.

[-] [email protected] 13 points 1 week ago

Sometimes? I'd bet that near 100% of cash tips in food service are unreported

[-] [email protected] 4 points 1 week ago

I never have and never will report a cash tip to any government ever they can go fuck themselves

[-] [email protected] 1 points 1 week ago

I can assure you that you need the money way more than they do.

[-] [email protected] 2 points 1 week ago

no ahit

[-] [email protected] 1 points 1 week ago* (last edited 1 week ago)

You theoretically could make the cash tips just disappear. The computer where I work guesses based on a rolling average of your card tips and it's usually pretty close. Which suggests to me that if anyone went snooping they could key in to the statistical anomaly of your curiously low cash tips rather easily. At the end of the day you're rolling the dice.

Personally I do report, partially because I don't want to piss off the IRS if they ever do take an interest in me but mostly because I don't qualify for housing assistance even without reporting them and nobody will rent to me unless I do report them because, get this, I don't earn an extra $3 for every $1 the rent goes up, especially not in wages. I am actually kind of jealous of apparently everyone else in the industry who somehow get approved for apartments despite making half of what they're supposed to on paper

[-] [email protected] 5 points 1 week ago

Yay! You can now 'tip' your favorite judge or Supreme Court justice without having to worry about pushing them into a new tax bracket!

this post was submitted on 21 May 2025

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