The Treasury Department just dropped a game-changer for hardworking tipped workers across America. On Monday, a sweeping new tax deduction was announced, targeting a vast array of jobs that rely on tips to make ends meet. This isn’t just a pat on the back; it’s a real financial lifeline for those grinding in service industries.
According to Newsmax, the move fulfills a key campaign promise by President Donald Trump to nix taxes on tips, offering eligible workers a deduction of up to $25,000 on cash tips and $12,500 on overtime pay from their federal taxable income through 2028.
Shared exclusively with Axios, the Treasury’s full list of qualifying jobs reads like a who’s who of the service economy. It’s not just waiters and bartenders getting a break—though they’re certainly included—but a broad swath of professions from cabbies to caddies. The list, split into eight detailed categories, shows an effort to cover every corner of tip-dependent work.
Let’s start with Beverage & Food Service, where everyone from chefs and dishwashers to fast food counter workers and host staff can claim this deduction. Then there’s Entertainment and Events, covering gambling dealers, musicians, dancers, and even digital content creators—yes, your favorite livestreamer might just qualify. Hospitality and Guest Services rounds out the early list with bellhops, concierges, and housekeeping staff.
But wait, there’s more: Home Services includes landscapers, electricians, and roadside assistance workers, proving this isn’t just a restaurant gig perk. Personal Services extends to nannies, tutors, and private event planners, while Personal Appearance and Wellness covers barbers, massage therapists, and tattoo artists. Recreation and Instruction, plus Transportation and Delivery, wrap it up with golf caddies, tour guides, rideshare drivers, and home movers, all cutting.
Treasury Secretary Scott Bessent called the list “expansive but fair.” Well, isn’t that a nice way to pat yourself on the back while sidestepping how long overdue this relief is for workers who’ve been taxed on every hard-earned dime? Still, credit where it’s due—this does cast a wide net for those often ignored by flashy progressive policies.
Bessent also noted, “For workers, $20 here and $20 there can make a big difference.” He’s not wrong, but let’s not pretend this is charity—it’s a recognition that tipped workers have been carrying the tax burden for far too long while coastal elites sip their lattes. This deduction is a rare win for the little guy in an era of overreaching government.
Now, the Treasury and Internal Revenue Service are set to publish this list and the proposed regulations in the Federal Register. That’s the bureaucratic stamp of approval, ensuring this isn’t just a press release but a policy with teeth. Workers in these roles can start planning for some well-deserved tax relief.
Imagine a bartender in a bustling city or a rural diner waitress finally keeping more of their hard-earned tips. That’s $25,000 of cash tips off the taxable table—money that can go to bills, groceries, or maybe just a night off. It’s not a cure-all, but it’s a start.
Then there’s the overtime pay deduction—up to $12,500 shielded from federal taxes until 2028. For those pulling double shifts or late-night deliveries, this is a nod to the hustle that keeps America moving. It’s refreshing to see a policy that doesn’t bow to the woke crowd but actually prioritizes real labor.
This isn’t about handouts; it’s about fairness for folks in jobs that don’t come with cushy benefits or corner offices. From valets to hairstylists, these workers often live tip to tip, and taxing those earnings has always felt like a slap in the face. Finally, someone in Washington seems to get it.
Of course, some will grumble that this doesn’t go far enough or that it’s a political stunt. But for the millions of Americans in these roles, a few extra bucks in their pocket isn’t a game—it’s survival. Let’s not let the naysayers drown out a rare bit of common sense from the feds.
The breadth of this list—from pet caretakers to charter boat workers—shows an understanding that tipped income isn’t just a restaurant thing. It’s a way of life for countless professions that don’t get the spotlight but keep our communities running. That’s a perspective worth applauding.
Until 2028, this deduction offers a buffer for workers to breathe a little easier when tax season rolls around. It’s not permanent, which raises questions about what happens after, but for now, it’s a victory for those who’ve been overlooked by big government schemes. Here’s hoping this sets a precedent for more policies that value sweat over soundbites.
So, to the wait staff, the drivers, the stylists, and every tipped worker in between—take a moment to celebrate this win. Washington may not always have your back, but this time, it’s thrown you a bone worth catching. Let’s keep pushing for a system that rewards hard work over hollow promises.
