Senators Introduce No Tax on Tips Act

Sen. Ted Cruz (R-Texas) has reintroduced the No Tax on Tips Act, a bipartisan bill that aims to exempt tips from federal income tax, allowing workers in traditionally tipped positions to claim a 100% deduction on tips up to $25,000. The bill is supported by a coalition of senators, including Democrats Jacky Rosen and Catherine Cortez Masto from Nevada, and follows a campaign promise made by President Trump. Cruz emphasized the need for this legislation as many American workers rely on tipped wages and face financial challenges due to rising costs. Rosen highlighted the importance of ensuring that tipped workers keep more of their earnings, while also advocating for a higher minimum wage and elimination of the subminimum wage. The bill includes provisions to prevent misuse, such as disqualifying individuals making over $150,000 from benefiting. Moreover, a companion bill has been filed in the House of Representatives to support the initiative.