"Senate Approves 'No Tax on Tips Act' to Support Service Industry Workers"

Read "Senate Approves 'No Tax on Tips Act' to Support Service Industry Workers" on WALY Radio

"Senate Approves 'No Tax on Tips Act' to Support Service Industry Workers"

[!CDATA[The Senate has approved the “No Tax on Tips Act,” fulfilling a promise made by President Donald Trump during his campaign. The bill, which garnered bipartisan support, will now move to the House of Representatives for consideration. If enacted, the legislation will provide a tax deduction of up to $25,000 for cash tips received by eligible employees. Introduced by Texas Senator Ted Cruz and brought up for consideration by Democrat Senator Jacky Rosen, the bill aims to protect the earnings of blue-collar workers who rely on tips to make ends meet. Senate minority leader Chuck Schumer praised Rosen for advancing the legislation and criticized Trump for favoring tax breaks for the wealthy over working-class Americans. The proposed bill seeks to amend the IRS code to allow workers in the food, drink, and beauty industries to claim a 100 percent tax deduction on tips received in various forms, including cash, credit, debit cards, and checks. It specifically outlines the types of services that qualify for the tax exemption, such as food and beverage service and beauty services like barbering, nail care, esthetics, and spa treatments. Under the bill, the Treasury Secretary will compile a list of occupations that traditionally receive tips by the end of 2023. Individuals earning more than $160,000 annually would not be eligible for the tax exemption. While an estimated 4 million workers in tipped occupations exist in the U.S., a significant portion of them already have low incomes that exempt them from federal income tax, according to research from The Budget Lab at Yale. In conclusion, the “No Tax on Tips Act” aims to provide tax relief to workers in service industries who rely on tips as a significant portion of their income. If passed into law, the bill could benefit millions of Americans by allowing them to claim tax deductions on their hard-earned tips.]]