Click here or on the image below to watch a video clarifying tax-free tips for service workers.
In many service jobs, tips are a big part of the paycheck. For 2025, the IRS has new rules that may let some workers deduct a portion of those tips, up to $25,000. It’s worth checking your records and W-2.
The “no tax on tips” provision covers nearly 70 occupations, from bartenders to taxi drivers to DJs. Find out if your tips could be tax-free. For more information, visit IRS.gov/OBBB.