No Tax on Tips Calculator (2025–2028)
The OBBBA "no tax on tips" provision excludes up to $25,000 of qualifying tip income from federal income tax for tax years 2025 through 2028. FICA and state income tax are unaffected.
Guidance, not advice. This calculator runs the rules as published, it doesn't assess your circumstances. Your actual tax may be affected by factors it doesn't cover (deductions, credits, filing status nuances, state-specific adjustments). Always seek financial or tax advice from a qualified CPA, Enrolled Agent, or tax attorney, or contact the IRS. Read our editorial scope →
Temporary provision — expires after tax year 2028
Temporary provision — expires after tax year 2028. Without further legislation, this benefit is not available for 2029 and beyond.
Your situation
Cap is $25,000 of tip income; phases out above $160,000 MAGI.
$
$
$
Your estimated savings
Capped tip income
$18,000
MAGI phase-out
−$0
Excludable
$18,000
Federal tax savings (22% bracket)
$3,960
FICA still applies
Tips remain subject to Social Security and Medicare tax. Your share of FICA on the full $18,000 of tips is approximately $1,377 (7.65%), unchanged by this provision. The employer share is also still owed.
Only "qualifying" occupations (those customarily and regularly receiving tips before 2025) are eligible. Reported tips must appear on Form W-2 to be excluded.