"Regularly tipped workers who received tips on or before Dec. 31, 2024 are eligible, according to the legislation. According to the bill, some tip workers will be able to deduct up to $25,000 of "qualified tips," which means "voluntary cash or charged tips received from customers or through tip sharing." For those making over $150,000 ($300,000 for joint filers), the deduction will go down accordingly."
"But jobs that are "specified service trade or businesses" (SSTB) don't qualify at all, according to the legislation. And, Ben Henry-Moreland, a certified financial planner with adviser platform Kitces.com, told CNBC, that, with the qualification in mind, the recent list could lead to confusion, as many "people will be surprised to find out that not every single occupation on [the Treasury list] is going to actually be eligible for the deduction.""
President Trump signed a provision creating a "no tax on tips" deduction as part of legislation on July 4. The Treasury released a preliminary list of occupations that may be eligible, but additional guidance may be required to determine actual eligibility because some listed jobs may not meet administrative criteria. Regularly tipped workers who received tips on or before Dec. 31, 2024 can qualify. Eligible workers may deduct up to $25,000 of qualified tips, with a phaseout beginning at $150,000 ($300,000 joint). Specified service trades or businesses (SSTBs) are categorically excluded, and many common occupations may fall into that category.
Read at Fast Company
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