This bill aims to clarify the tax treatment of specific types of tips by amending the Internal Revenue Code of 1986. Its primary purpose is to ensure that certain tips are considered voluntarily paid for tax deduction purposes. The legislation explicitly states that any tip automatically added to a customer's bill at the time of payment, along with any tip suggested or prompted by a business, must be treated as voluntarily paid. This clarification is intended to impact how these tips are categorized for tax purposes, potentially affecting their eligibility for qualified tip deductions.
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Timeline
Introduced in Senate
Read twice and referred to the Committee on Finance.
Introduced in Senate
Read twice and referred to the Committee on Finance.
Taxation
No Tax on Large Party Tips Act
USA119th CongressS-2780| Senate
| Updated: 9/11/2025
This bill aims to clarify the tax treatment of specific types of tips by amending the Internal Revenue Code of 1986. Its primary purpose is to ensure that certain tips are considered voluntarily paid for tax deduction purposes. The legislation explicitly states that any tip automatically added to a customer's bill at the time of payment, along with any tip suggested or prompted by a business, must be treated as voluntarily paid. This clarification is intended to impact how these tips are categorized for tax purposes, potentially affecting their eligibility for qualified tip deductions.