The Internal Revenue Service released guidance on New Year's Day for President Trump's "no tax on tips" and "no tax on overtime" deductions that were part of the One Big Beautiful Bill Act signed into law on July 4.
Trump made eliminating taxes on tips and overtime a cornerstone of his 2024 campaign after watching Biden's inflation disaster crush working families. Now millions of Americans who put in extra hours or depend on tips will see real relief when they file their 2025 taxes in just a few weeks.
Workers who receive tips can deduct up to $25,000 from their taxable income. The IRS estimates about 6 million workers report tipped wages and will be eligible for these deductions starting with the 2025 tax year through 2028. For overtime workers, the tax break is equally significant.
Employees can deduct up to $12,500 as single filers or $25,000 for joint filers from the "time-and-a-half" portion of their overtime pay. That's money Biden's IRS was taking straight out of paychecks from people working 50 and 60-hour weeks just to keep up with his inflation.
The deductions phase out for taxpayers earning over $150,000 individually or $300,000 for couples filing jointly. [deplorable daily]
Good Night, Patriots!
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