SOME CARD INFO MAY BE OUTDATED
This page includes information about these cards, currently unavailable on NerdWallet. The information has been collected by NerdWallet and has not been provided or reviewed by the card issuer.
Tipped wages will be exempt from taxes for 68 jobs, according to the list revealed by the Treasury Department in an exclusive to Axios.
The “no tax on tips” policy exempts gratuities from federal income and payroll taxes. President Donald Trump first promised to exempt tipped workers from the tax during the 2024 election. The ‘no tax on tips’ deduction was included in the “one big, beautiful bill” passed by Congress in July. Taxpayers who qualify will be able to claim the deduction with their 2025 tax filing next year.
The policy has drawn praise from some industry groups, like the National Restaurant Association, which frames it as beneficial for existing workers and a potential tool to attract more people to tipped positions. But critics argue that the policy benefits a narrow slice of the workforce and undermines broader support for workers to obtain benefits like health care. They also warn that the temporary deduction could be gamed if workers reclassify regular wages as tips.
How the ‘no tax on tips’ deduction works
If you qualify, the types of tips that count include debit or credit card tips, reported and tracked cash tips or tips received through tip-sharing programs. Mandatory service charges like automatic gratuity aren’t eligible.
The deduction only applies to federal income taxes so you may still have to pay state and local taxes. Social Security and Medicare taxes are still withheld from all tips.
Meet MoneyNerd, your weekly news decoder
So much news. So little time. NerdWallet's new weekly newsletter makes sense of the headlines that affect your wallet.
There are income limits, too: If your modified adjusted gross income is $150,000 or less, you’re eligible for the full deduction. For joint filers, this limit doubles to $300,000.
For every $1,000 your income exceeds those limits, the deduction is lowered by $100. And if you earn above $400,000 as an individual or above $550,000 as a joint filer, you can’t claim the deduction.
The deduction is only valid from 2025 to 2028, for now. When you file your taxes, report your tips on Form 1040.
What jobs are included in the ‘no tax on tips’ exemption?
Treasury Secretary Scott Bessent told Axios that the list of jobs is “expansive, but fair.” The tipped tax-exempt jobs are grouped into eight categories covering multiple industries. The list includes multiple performance positions within entertainment jobs, which were disqualified under the ‘big beautiful bill.’
Here’s the full list of positions that qualify for the exemption.
1. Beverage & food service
- Bartenders
- Wait staff
- Food servers, non-restaurant
- Dining room and cafeteria attendants and bartender helpers
- Chefs and cooks
- Food preparation workers
- Fast food and counter workers
- Dishwashers
- Host staff, restaurant, lounge, and coffee shop
- Bakers
2. Entertainment & events
- Gambling dealers
- Gambling change persons and booth cashiers
- Gambling cage workers
- Gambling and sports book writers and runners
- Dancers
- Musicians and singers
- Disc jockeys (except radio)
- Entertainers & performers
- Digital content creators
- Ushers, lobby attendants, and ticket takers
- Locker room, coatroom and dressing room attendants
3. Hospitality & guest services
- Baggage porters and bellhops
- Concierges
- Hotel, motel and resort desk clerks
- Maids and housekeeping cleaners
4. Home services
- Home maintenance and repair workers
- Home landscaping and groundskeeping workers
- Home electricians
- Home plumbers
- Home heating/air conditioning mechanics and installers
- Home appliance installers and repairers
- Home cleaning service workers
- Locksmiths
- Roadside assistance workers
5. Personal services
- Personal care and service workers
- Private event planners
- Private event and portrait photographers
- Private event videographers
- Event officiants
- Pet caretakers
- Tutors
- Nannies and babysitters
6. Personal appearance & wellness
- Skincare specialists
- Massage therapists
- Barbers, hairdressers, hairstylists, and cosmetologists
- Shampooers
- Manicurists and pedicurists
- Eyebrow threading and waxing technicians
- Makeup artists
- Exercise trainers and group fitness instructors
- Tattoo artists and piercers
- Tailors
- Shoe and leather workers and repairers
7. Recreation & instruction
- Golf caddies
- Self-enrichment teachers
- Recreational and tour pilots
- Tour guides and escorts
- Travel guides
- Sports and recreation instructors
8. Transportation & delivery
- Parking and valet attendants
- Taxi and rideshare drivers and chauffeurs
- Shuttle drivers
- Goods delivery people
- Personal vehicle and equipment cleaners
- Private and charter bus drivers
- Water taxi operators and charter boat workers
- Rickshaw, pedicab, and carriage drivers
- Home movers
The list will soon be published in the Federal Register, according to Axios.
(Photo by Brandon Bell/Getty Images News via Getty Images)
Meet MoneyNerd, your weekly news decoder
So much news. So little time. NerdWallet's new weekly newsletter makes sense of the headlines that affect your wallet.Article sources
NerdWallet writers are subject matter authorities who use primary,
trustworthy sources to inform their work, including peer-reviewed
studies, government websites, academic research and interviews with
industry experts. All content is fact-checked for accuracy, timeliness
and relevance. You can learn more about NerdWallet's high
standards for journalism by reading our
editorial guidelines.
