Advocacy Update l Major Tax Policy Changes

From Aaron Frazier, Vice President of Public Policy at the National Restaurant Association.

What’s happening: Restaurant waitstaff, bartenders, cooks, bakers, baristas, bussers, hosts, and counter workers are among the occupations listed as eligible for “No Tax on Tips” treatment of their tipped income according to a new government plan. As the new tax law required, the U.S. Department of Treasury released a list of traditionally tipped occupations within 90 days of the law’s enactment. This preliminary list will receive public comments, but the Treasury Department predicted a final list will be “substantially the same.”

Why it’s important: No Tax on Tips allows for workers in these occupations to take up to a $25,000/year deduction for tipped income before that income is subject to federal income taxes. The deduction begins in tax year 2025 and is scheduled to sunset at the end of 2028.

Access to the list is linked here.

Learn more about No Tax on Tips and the pro-growth policies that became law.

More resources:

Forbes, Who’s Eligible For No Tax On Tips?

OBBBA Signed into Law: A Breakdown of Key Tax Changes for Restaurants