No Tax On Tips: A positive for service workers

Florida Congressman Byron Donalds is proposing a new bill dubbed the “No Tax on Tips Act.”

The bill would allow service workers to keep all of the money they make in tips, a particularly crucial source of income for many in the service industry.

At 10 Twenty-Five in downtown Fort Myers, James Pires cooks up connections to cash in on more tips.

“At the end of the night, it’s all about your hard work and you know, what you put into the community and how you give back to them. So that is truly a testament to how many tips you receive,” said Pires.

“I feel like I, you know, I earned that money, you know, through hard work,” said Pires.

But with every tip comes a tax… literally.

Cash tips face an income tax, plus many establishments take out a percentage of the tips every shift.

“I just feel very discouraged about it, because it kind of like takes away from like, a job that you do. Because you’re giving a percentage of your money to something you don’t even know or see ever.”

Feeling ‘robbed’ of hard work is something bartender Danielle Fagan knows all too well.

“It’s definitely gut-wrenching. I, you know, I understand, like we should pay on the money that we make, but I just feel like it’s…I wish we didn’t have to,” said Fagan. “That’s what I rely on as my tips. Every paycheck is pretty much close to nothing.”

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• RELATED: Should people working in the service industry have to pay taxes on tips?

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Congressman Byron Donalds hopes to change that.

On Monday, the Florida Republican filed ‘The No Tax on Tips Act,’ a bill that would eliminate income tax on cash tips.

In a statement, he said, “Our bill allows taxpayers to claim a 100% above-the-line deduction at filing for tipped wages. Policymakers must put the needs and financial interests of hardworking Americans first.”

Tip earners that WINK News reporter Maddie Herron spoke to are all for it.

“That’s more money in my pocket easier, easier for me to pay my bills,” said Pires.

“It would be night and day for me. It would bring a lot of appreciation back to the job itself,” said Cody Wessel, a bartender at Izzy’s Fish and Oysters.

Putting tips back in the pockets of those who worked hard to earn them.

Although many are excited about this bill, the scales have yet to tip in its favor and pass.

If the bill progresses and becomes law, it will apply to taxable years after the start of 2025.

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