TIPS & OVERTIME TRICKERY?

Congress wants to make tips and overtime tax-free. Sounds great, right?
But without wage protections, that “relief” could turn into a pay cut.

Employers could freeze wages, slash hours, or reclassify workers — and the kicker? These tax breaks are temporary. The fallout might not be.

🍽️ Tip your server. And maybe tip off your coworkers too.

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Author: craigcrawford

Trail Mix Host. Lapsed journalist, author & retired pundit happily promoting nothing but the truth for Social Security checks.

50 thoughts on “TIPS & OVERTIME TRICKERY?”

  2. https://www.msn.com/en-us/money/economy/trump-s-big-beautiful-bill-eliminates-taxes-on-tips-here-s-who-benefits-most/ar-AA1HMIop?ocid=BingNewsSerp

    One key provision in the bill would create an above-the-line deduction for tips earned by workers in occupations that traditionally receive tips. That means a bartender, for instance, would be able to deduct the total amount of their tips from their taxable income in a given year.
    A few restrictions apply, however. The approved Senate version phases out for individuals making more than $150,000 a year, or $300,000 a year for joint filers, and it expires after 2028. The deduction is also capped at $25,000.
    The exemption also applies only to federal income tax. Tipped workers would still be subject to state and local income and payroll taxes.
    Currently, tips are treated as regular income and must be reported along with wages on a worker’s W-2 form. “That’s the way the law has been for decades,” Lawrence Pon, a certified public accountant and certified financial planner in Redwood City, California, told CNBC Make It in May.
    If enacted, the provision would mark a major shift by allowing tipped workers to deduct tips directly from their total income.
    What no taxes on tips means for workers
    About 2.5% of the U.S. workforce, or 4 million workers, held jobs where tips are common in 2023, according to an analysis by the Yale Budget Lab. Of those, about 60% of households with tipped workers would receive a cut, according to the Tax Policy Center — one that would amount to about $1,800 per household per year.
    However, the proposed tax cut would primarily benefit higher-income tipped workers, mostly because those who make less than the standard deduction already owe no federal income tax.
    The top 20% of tipped workers would receive an average tax cut of $5,768, while the bottom 20% would only receive only $74 on average, according to the Economic Policy Institute.
    Additionally, opponents say the proposed law would introduce financial inequalities among employees making the same amount of money. “Two workers earning the same annual income could face vastly different tax burdens simply because of the nature of their livelihoods,” wrote the Tax Foundation’s Abir Mandal in April.
    Instead, critics including the Economic Policy Institute, advocate for increasing the federal minimum wage as a better way to help all low-wage workers.
    “Increasing the minimum wage would deliver dramatically larger raises for millions more workers without letting employers off the hook,” write EPI’s Nina Mast and David Cooper.

  4. https://www.washingtonpost.com/world/2025/07/02/no-tax-on-tips-global-tipping-culture/

    Tipping culture in the United States has long made the country a global outlier — especially in cases where workers rely on tips for much of their income. Now, the move to eliminate federal income tax on tips could deepen the divergence from much of the world.
    […]
    The federal wage floor in the U.S. for tipped workers is $2.13 per hour. Legislators in Europe and elsewhere have backed steady increases in minimum wages as a way to help low-paid workers.
    Gratuities, which began in feudal Europe as a way for aristocrats to give a little extra to those serving them have become a primarily American phenomenon, according to Saru Jayaraman, president of One Fair Wage and a leading advocate for a living wage for service workers.
    “We continue to be the only country on Earth where tips replace wages completely,” Jayaraman said. “In most of the world, the idea of tips being a replacement for wages is absurd.”
    Here’s how other countries treat tips.
    Other countries that tip
    As in the U.S., tipping is still common practice in Canada. But unlike in most U.S. states, tips are not considered part of an employee’s wages and tipped workers must still be paid at least minimum wage in the majority of Canada’s provinces. The province of Quebec, where the general minimum wage is 16.10 Canadian dollars (about $12) but the minimum wage for tipped workers is 12.90 Canadian dollars (about $9.50), is an exception. (Several U.S. states do not allow employers to count tips toward workers’ minimum wage.)
    Tipping is also fairly customary throughout the Middle East, including in Dubai, where a service charge is often automatically included. The term “baksheesh” is used interchangeably at times for gratuity throughout the region — as well as in North Africa and South Asia — but can also refer to begging, bribery or payment for favors.
    But there are few places on Earth where tipping is quite so ubiquitous or extensive as in the U.S., where it is a frequent subject of impassioned debate and culture shock among visitors from abroad. The system could be further entrenched by the move to make tips tax-free.
    And Americans are growing tired of tipping: A Bankrate survey found that 1 in 3 think the practice is “out of control,” The Washington Post reported last year.
    Countries where tipping happens less commonly
    Tipping is voluntary in Europe, though leaving a small tip of around 5 percent to 10 percent is often customary in places such as Austria and Germany, where such tips paid to employees, known as “Trinkgeld,” are generally not subject to tax.
    In France, service is often included in the price of a meal, rather than being paid to servers. Tips have been exempt from tax and social security contributions since 2022 — a measure put in place to help service industries recover from the pandemic.
    In Spain, tips are usually paid in cash — with the implied understanding that they’re unlikely to be taxed.
    Countries where people don’t usually tip
    Tipping has historically been frowned upon in parts of Asia — in China, the practice, seen as bourgeois, was once banned. In Japan, where workers pride themselves on offering good service, tipping is seen as impolite.
    Tipping is uncommon in countries such as Norway, which has high minimum wages and generous public welfare programs. Services are generally included in restaurant bills, and customers are not obliged to tip. Norwegian employers are required to keep track of workers’ tips, which are subject to withholding tax. In neighboring Sweden, customers sometimes round up to the nearest whole number, but again, it is not expected.
    Australia also has a high minimum wage, and tipping is rare outside of high-end restaurants in major cities. Earning a fair wage has long been seen as a crucial part of maintaining Australia’s historically egalitarian culture — in a country where public health care and robust social welfare programs are the norm. An independent commission weighs where to peg the minimum wage every year. Restaurants may add service charges to a bill, but these generally go to the restaurant and not directly to wait staff. Tips are taxable, and workers are advised to keep track of them to avoid penalties.
    Tax experts say the U.S. plan might not do much to help low-income workers. Tipped workers represent fewer than 3 in 100 workers in America, according to an analysis by Yale’s Budget Lab. Critics warn that removing taxes on tips could have unintended consequences, potentially encouraging highly compensated workers — lawyers, accountants — to record some of their income as “tips.”

  5. this tips/overtime YouTube post got this comment I like:

    @notchomomma239
    1 hour ago
    It also only stops the tax on cash tips. Around 99% of the tips are credit card tips, which go totally unmentioned in this bill. That means it’s still taxable income. Thank you, Congress, for removing the tax on that $5 bill I get handed every other work day.

  6. The tips provision is half bullshit. Let me make that 75%. Three years, limited to $25000. Cash tips aren’t declared or taxed unless 1. They are distributed by the employer through the employee’s paycheck, 2. They are paid through a credit card, or 3. That hooker, Cinnamon in Vegas, the only worker in the US who reports the cash tips she gets from the salesmen at the conventions she works keeps doing that. We are fucked.

    Medicaid’s fucked. Medicare’s fucked. ICE is bigger than the FBI. Meemaw’s moving back into our house. The LWRHC* is closing.

    Oh, and Iran said inspections are done. Great work Dodo. Safer world now 😨

    *Lake Wobegone Rural Health Center.

  8. The tip + overtime tax break only runs from 2025 to 2028.
    Midterms. Then a presidential election.
    Then it vanishes.
    Total coincidence, I’m sure.

  10. craig, even more succinct “it steals from the poor and gives to the rich”


    in 1973 Monty Python predicts the US stimulus fiasco.
    this is the last 2 minutes of the Monty Python skit “Dennis Moore”, it’s funny and timely. the verbiage could be from todays headlines.
    best parts:

  15. https://www.investopedia.com/eliminating-social-security-taxes-big-beautiful-bill-provides-senior-bonus-11743513

    President Donald Trump has promised to eliminate taxes that beneficiaries pay on their Social Security checks.

    The Big Beautiful Bill does not eliminate taxes on Social Security benefits, but it does give a temporary tax break to those 65 and older with a modified adjusted gross income of up to $75,000—what some are calling a “senior bonus.”

    Eliminating income taxes on Social Security benefits would drain the trust funds that back the program faster than already projected.

    ***

    The Social Security Administration (SSA) announced in April that it would withhold 50% of benefit payments from anyone who was overpaid.

    Beneficiaries have 90 days from the time they are notified of the overpayments to request a waiver or reconsideration. For many, that period expires in July.

    Overpayments occur when beneficiaries incorrectly report their financial situation or SSA makes an error.

    ***
    https://www.whitehouse.gov/articles/2025/07/no-tax-on-social-security-is-a-reality-in-the-one-big-beautiful-bill/

    A senior who files as a single taxpayer and receives the current average retirement benefit (approx. $24,000) will see deductions that exceed their taxable Social Security income.

    Married seniors who both receive the average $24,000 Social Security income — a total of $48,000 in annual income — will also see deductions that exceed their taxable Social Security income.

    *The WH website has very different numbers. Who to believe? (Also, the part about draining the trust fund faster…and now all of the undocumented immigrants doing the hard work, paying in but never taking out are vanishing.

    DJT, Ya dumb TACO, you’ve ruined everything your entire life. FDT

  17. https://abcnews.go.com/Politics/democrat-hakeem-jeffries-marathon-magic-minute-speech-blasts/story?id=123444742

    Jeffries took to the House floor just after 5 a.m. on Thursday and has now been speaking for more than six hours, delaying a final vote in the chamber on the domestic policy bill at the heart of Trump’s second term agenda.

    Jeffries has stacks of binders next to him at the podium as he picks apart the bill and some of the Republicans who voted for it.

    I’ve been given 15 minutes each on a bill of such significant magnitude as it relates to the health, the safety and the well being of the American people and because that debate was so limited, I feel the obligation, Mr. Speaker, to stand on this house floor and take my sweet time to tell the stories and that’s exactly what I intend to do,” Jeffries said.

    The “magic minute” speech is a procedure that grants members of House leadership unlimited time to speak after debate on a bill has concluded.

    “People will die. Tens of thousands, perhaps year after year after year, as a result of the Republican assault on the healthcare of the American people,” Jeffries said. “I’m sad. I never thought I would be on the House floor saying this is a crime scene.”

    “You see, budgets are moral documents. And in our view, Mr. Speaker, budgets should be designed to lift people up,” he said. “This reckless Republican budget that we are debating right now on the floor of the House of Representatives tears people down.”

    “This reckless Republican budget is an immoral document,” Jeffries continued. “And everybody should vote no against it because of how it attacks children, seniors, and everyday Americans, and people with disabilities. This reckless Republican budget is an immoral document. And that is why I stand here on the floor of the House of Representatives with my colleagues in the House Democratic caucus to stand up and push back against it with everything we have.”

    *Now, Republicans will have to vote in the light of day. Will it matter if it’s not on the evening news? Is anyone watching the day before a holiday, anyway?

  18. Last year, birthday 248 of Independence Day, was the last celebration. Nothing to celebrate this year. Next year, birthday 250, is when Project 25 is to be fully implemented.

    The Rebirth of a Nation? How the Religious Right May Replace the Constitution by July 4, 2026

    Executive Order 2025-01901 opened the floodgates. On his first day back in office, President Trump signed an order that rescinded nearly every civil rights advancement of the last administration. LGBTQ protections, DEI policies, and climate safeguards were stripped away in one sweep. The justification? To restore common sense and moral clarity. The effect? A federal reset that cleared the ground for something far more permanent.

    Soon after came the launch of the “America 250” campaign, not just a celebration of independence, but a rebranding effort for a new national identity. Embedded in that initiative was a full year of coordinated federal and cultural programming designed to instill reverence for a past that never existed, while laying the emotional groundwork for a legal order that has not yet been unveiled.

    At the same time, the White House Faith Office was reestablished with new authority, operating directly from within the Executive Office of the President. It now serves as a clearinghouse for religious influence in federal policymaking, including in health, education, and civil rights enforcement. This is not an interfaith body. It is a launchpad for embedding Christian nationalist doctrine across the federal landscape.

    Perhaps most revealing is the creation of DOGE, the Department of Government Efficiency. On paper, it is a temporary agency tasked with trimming waste and streamlining bureaucracy. In practice, it is a shadow architecture review team, identifying which federal departments, employees, and programs align with the new regime and which will be discarded. DOGE, too, is scheduled to dissolve on July 4, 2026.

  19. What Booker did in the Senate, Jeffries is now doing in the House. He’s into seven plus hours going for record. It won’t change a thing as the GOP cowardly cave in is still expected to pass the Bodacious, behemoth boondoggle.

  20. Jamie, the longer he can go the likelier they’ll lose GOPers who have travel commitments that can’t be broken. As you well know on capitol hill the afternoon before a holiday there’s always a giant sucking sound of congresscritters getting out of town – you’re roadkill if you get in their way- and July 4th is the biggest political must-do holiday there is.

    hang in there, Hakeem!

  22. I can’t make a case against Maga Misery. They voted for it; they’re gonna get it.

    Apparently, it’s necessary for them to feel their self-inflicted pain. My worry is it won’t happen quick enough to create a cause-and-effect connection in their brains.

    I feel for the children, they don’t deserve this and will be harmed by it, physically, mentally and spiritually.

  23. Maga discovered during covid they could reduce large swaths of the “undesirable” population with impunity, so they’re trying that again.

  24. Dying of Whiteness: How the Politics of Racial Resentment Is Killing America’s Heartland
    By Jonathan M. Metzl

  25. Time for a Trump-era update of the book

    In his 2019 non-fiction book, which is based on several years of research undertaken in the 2010s in the South and Midwest states—Missouri, Tennessee and Kansas, physician and psychiatrist Jonathan Metzl reveals the unintended public health consequences of some right-wing backlash politics related to taxes, gun control, social safety nets, and healthcare on vulnerable white voters they had promised to help. Through “field interviews, research and public-health data” gathered over the years of travel to these states, Metzl found that some vulnerable white Americans would rather die than betray their political views that have become enmeshed with their own sense of white identity.

    https://en.wikipedia.org/wiki/Dying_of_Whiteness

  26. Dying for their faith is, in fact, the core of white evangelical belief. Not gonna change that.

  28. Wait until folks start dying of at Alligator Auschwitz, not from gators but from mosquito-borne illnesses. Those 5,000 beds will be replenished with fresh victims on the regular. If/when there is a hurricane, they’ll either die from an “act of God,” or they’ll be flown to CECOT or Sudan or another foreign gulag under the guise of a humanitarian evacuation.

    May MAGAt Republicans rot in hell.

  29. https://www.rawstory.com/rob-bresnahan-2672598520/

    Rep. Rob Bresnahan (R-PA) was caught selling stock for a company providing Medicaid exchanges just days before President Donald Trump’s so-called “One Big Beautiful Bill” was expected to pass with drastic cuts to the program.

    Rep. Melanie Stansbury (D-NM) slammed Bresnahan for the move.

    “This Congressman literally dumped stock in a Medicaid provider company right before this bill came to the Floor,” Stansbury wrote Thursday on X. “Don’t be fooled—these guys know exactly what they’re doing.”

    “The stock has now fallen 43% since his sale,” Quiver revealed on Thursday.

    *Here’s one of the Republican tools I contacted yesterday.

  30. All of those insurance companies in the ACA exchange will take a hit in January.

    That 2026 cut will wake up some MAGAts who didn’t realize they were on it. My self-employed relatives in California just called it by whichever insurance company the coverage was with and they got really offended when they realized it was “Obamacare.”

  32. this is exactly the same as when Obama established a Christo-fascist kleptocracy

  33. get ready for roving bands of ICE Gestapo terrorizing your town, you better hope they don’t get bored and run out of immigrants cause they’ll come after you when they do

    It all pays the same

  34. Coming Soon: tRUMP-branded MAGAcare

    Nah, he only needed that one vote from them. They can just die now.

  35. https://www.mccookgazette.com/story/3063872.html

    Community Hospital has announced the difficult decision to close Curtis Medical Center, located in Curtis, Nebraska. An exact date for the closure is yet to be determined. Inflation over the past few years combined with the current uncertainty of future federal funding has led to this decision.

    “This transition will take place over the coming months, and our top priority throughout this process is the well-being of our patients,” said Troy Bruntz, President and CEO of Community Hospital. “We are deeply grateful to the Curtis community for their unwavering support and trust over 30 years. This clinic has been a vital part of our mission to deliver quality healthcare close to home. Unfortunately, the current financial environment, driven by anticipated federal budget cuts to Medicaid, has made it impossible for us to continue operating all of our services, many of which have faced significant financial challenges for years. We remain committed to supporting our patients through this transition and ensuring continuity of care.”

    At this time, Community Hospital plans to continue to serve Curtis and the surrounding communities with its Community Hospital Behavioral Health program, providing important mental health support and resources to the community.

  38. https://www.politico.com/news/2025/07/03/supreme-court-third-country-deportations-south-sudan-00439701

    The Supreme Court on Thursday cleared the way for the Trump administration to deport eight men to South Sudan who have been detained in a shipping container on a U.S. military base in Djibouti for six weeks after becoming caught up in a legal tug-of-war between the White House and a federal judge in Boston.

    Seven of the men have no ties to South Sudan, but the administration wants to send them there as part of an effort to expel people to so-called third countries when U.S. law bars them from being sent to their home countries or when their home countries will not accept them.

    “They’re now subject to imminent deportation to war torn South Sudan, a place where they have no ties and where it is possible, if not probable, that they will be arrested and detained upon arrival,” said Trina Realmuto, an attorney for the men. “This ruling is condoning lawlessness.”

    The eight men were on a flight in May apparently bound for South Sudan but ended up in the East African nation of Djibouti when Murphy put the deportations on hold. They have been held on a U.S. military base there in makeshift detention — what the administration has called a converted shipping container — while the administration has appealed Murphy’s directives.

  39. 3 hours sweating over a grill? Burning your fingers trying to carve?
    Nah. Pre-cut the ribs, broil ’em to caramelized glory, and act like it was hard.

  40. https://www.newsweek.com/iran-hackers-threaten-leak-trump-emails-2092864

    An Iran-linked hacking group has threatened to release a batch of emails it said it has stolen from President Donald Trump’s longtime aides, including adviser Roger Stone and White House chief of staff Susie Wiles.

    Reuters reported Monday that a cyberattack group that hacked the president’s campaign in 2024 claimed it had roughly 100 gigabytes of emails it could leak.

    The hackers, operating under the pseudonym Robert, did not provide information about the content of the emails or when they plan to release them, according to the news agency. The group previously released some emails in the lead-up to the U.S. presidential election last year.

    In online chats with Reuters, they said they also had emails from the accounts of Trump attorney Lindsey Halligan and Stormy Daniels…

    Reuters authenticated some material in the previous leak, which emerged in the run-up to the presidential election. The material, which included emails from accounts including that of Wiles, was sent out to journalists.

    One email appeared to detail a financial arrangement between Trump and attorneys representing Robert F. Kennedy Jr., Trump’s pick for health secretary. Another discussed settlement negotiations with Daniels, the news agency said.

    *Just do it!

  41. Lobbyists, Oligarchs and Power: The Pro-Putin Network Raising Fears of Foreign Influence in Trump’s Team

    Trump’s newly appointed Chief of Staff, Susie Wiles, brings a complex political profile, with ties to Russian oligarchs and Chinese surveillance firms.

    Before joining Trump’s 2024 campaign, Wiles was a co-chair at a firm that lobbied for sanctioned individuals and companies. A lobbyist who recommended Wiles to lead US President-Elect Donald Trump’s campaign represented a Russian-born oligarch connected to the Russian President Vladimir Putin and a state-owned oil corporation Rosneft.

    Wiles’ ex-husband has ties to a Kremlin-linked lobbyist known for attending the 2016 Trump Tower meeting, where “dirt” on Clinton was offered on the Russian Government’s behalf.

    Wiles’ daughter failed the White House background check.

    Examining her lobbying work and personal connections reveals the scale and reach of foreign affiliations, raising concerns over potential foreign influence within Trump’s incoming administration.

    *Et cetera, et cetera, et cetera

  42. Exposing themselves to minors and public urination. Don’t forget kidnapping and human trafficking.

    It’s going to be “the purge.” I will haunt them from the other side if it comes to that, and I will haunt them hard.

  43. Plus, qualified immunity, plus no accountability

    Hooray, great job you dumb fucking Trumpers hooray best foürth ever

  44. Well. Okay, how to fight the nazzis and get America back? Heck of a question I never expected to post. There have been many movies about this, including a couple I like, Seven Days in May, and another involving aliens Independence Day. Sorry about punctuation I’m trying to do this on a tablet and the developers need to use their product before release.

    The local NBC station, Washington, D.C., finally put the basic numbers on air about what is going to hit middle and low income people. I would go to the faux snooze channel but will wait a while, i need to get a “refreshment” reload first.

    You hear about fox on air broadcasting. It is a lot more than on cable. Whenever I go to antenna tv the first thing I see is fox television. Does not matter where, fox stations cover the reception. It is one solid act that none of the other media does so well. Much of the country is dropping cable, some going with cable internet, some with cellphone internet, and some digging out the rabbit ears. The strongest channels are the fox channels.

  45. BB – QVC & HSN have the best antenna reception. Highly incentivized to do it.

  47. how to fight the nazzis and get America back?

    ugh all we had to do was not elect them, so much for the easy way 😒

  48. Social Security sending out messages bragging about tax relief for seniors. Unfortunately, anyone living on SS doesn’t earn enough to be taxed.

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