Dutch Uncle
* Tertia Optio * Defend the Constitution
As more and more people are finding out, Trump promises a lot but delivers little...if at all.
Who thinks mostly middle and lower income workers will benefit the most from Trump's BBB and who thinks it's mainly the Oligarchy who'll reap the most benefits?
Among the particulars restricting the reach of the measure: Only the first $25,000 in tips are free from income taxes. Tipped workers will still face the 7.65% combined payroll taxes that fund Social Security and Medicare. And workers won’t be able to benefit if federal officials say their type of service job doesn’t qualify.
“No tax on tips” started as a campaign promise by President Trump during a 2024 stop in Nevada, the state with the highest concentration of service workers who rely on tips. It is now a key element of the tax-and-spending megabill that Trump signed into law Friday. Even though it is one of the smaller pieces of the law in terms of dollars—accounting for $32 billion out of $4.5 trillion in tax cuts—it is one of Republicans’ top talking points....
...Under Republicans’ policy, workers who do pay federal income taxes will be able to deduct up to $25,000 for tips. For someone in the 12% tax bracket making that much in tips, the change would deliver up to $3,000 in savings. The deduction would start phasing out once an individual’s income reaches $150,000, or $300,000 on a joint return for people who are married.
The relief will take effect this tax year, including for tips already received.
The law orders the Treasury secretary to publish a list of typical tip-earning jobs that qualify for the deduction, so it is unclear now exactly who will benefit. Tax experts said barbers, restaurant servers and other longtime service workers are almost certain to qualify, but it is unclear whether it will extend to other types of jobs such as online creators, who are sometimes tipped for their work.
Who thinks mostly middle and lower income workers will benefit the most from Trump's BBB and who thinks it's mainly the Oligarchy who'll reap the most benefits?
Trump Promised ‘No Tax on Tips.’ Then Came the Fine Print.
Many service workers are eagerly awaiting no longer paying taxes on their tips. Yet the fine print in Republicans’ new law could limit savings for some waiters, bartenders and others.Among the particulars restricting the reach of the measure: Only the first $25,000 in tips are free from income taxes. Tipped workers will still face the 7.65% combined payroll taxes that fund Social Security and Medicare. And workers won’t be able to benefit if federal officials say their type of service job doesn’t qualify.
“No tax on tips” started as a campaign promise by President Trump during a 2024 stop in Nevada, the state with the highest concentration of service workers who rely on tips. It is now a key element of the tax-and-spending megabill that Trump signed into law Friday. Even though it is one of the smaller pieces of the law in terms of dollars—accounting for $32 billion out of $4.5 trillion in tax cuts—it is one of Republicans’ top talking points....
...Under Republicans’ policy, workers who do pay federal income taxes will be able to deduct up to $25,000 for tips. For someone in the 12% tax bracket making that much in tips, the change would deliver up to $3,000 in savings. The deduction would start phasing out once an individual’s income reaches $150,000, or $300,000 on a joint return for people who are married.
The relief will take effect this tax year, including for tips already received.
The law orders the Treasury secretary to publish a list of typical tip-earning jobs that qualify for the deduction, so it is unclear now exactly who will benefit. Tax experts said barbers, restaurant servers and other longtime service workers are almost certain to qualify, but it is unclear whether it will extend to other types of jobs such as online creators, who are sometimes tipped for their work.