Quote:
Originally Posted by OrangeBlossomBaby
Jeez I think y'all need to stop posting until you start reading. The new bill doesn't have "no tax on tips." That is propaganda, it's not true, it's not in the bill. If you'd actually read the bill you'd know that.
It's a tax DEDUCTION - not a tax-free income. You get to deduct $25,000 from your tipped wages at the end of the year. If you were tipped well all year long, at a fancy restaurant where the average tip was $50, and you had 10 tables per night (that's $500 just in tips), and you worked 5 nights a week (that's $2500 per week) then your yearly TIPPED wage will be $130,000 just in tips alone. You can deduct $25,000 from that, and you pay income tax on the balance.
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Please explain the difference between “tax free” and “DEDUCTION” and subtracting $25,000 before calculating taxes. If I subtract that amount as a deduction before calculating taxes then it really feels like I made that income tax free.
Yes, it is only $25,000 but it is a deduction that most of us won’t get.
Yes(2), it is a deduction from Federal income tax but is still subject to other withholding taxes and probably state income tax. But again, it’s something.