Tip Tax Termination Act
Official title: To amend the Internal Revenue Code of 1986 to provide that certain tips shall not be subject to income taxes for a period of 5 years.
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Referred to the House Committee on Ways and Means.
Tip Tax Termination Act
This bill excludes from gross income for federal tax purposes up to $20,000 of eligible tips received during the tax year. The bill also requires the Internal Revenue Service to modify the tables and procedures used to withhold federal income tax from wages to take into account eligible tips excluded from gross income.
The bill defines eligible tips as amounts received while performing services in a position that generally relies on tips as part of wages, including cosmetology, hospitality, and food service.
Further, under the bill, the amount of eligible tips excluded from gross income must not be included in determining federal tax deductions or credits, except for purposes of calculating the child tax credit and earned income tax credit.
Finally, the exclusion from gross income only applies to eligible tips received before 2030.
- Introduced in House Formatted Text PDF Formatted XML
Cite this page
U.S. Congress. (2026). H.R. 558: Tip Tax Termination Act. 119th Congress. Open America. https://openamerica.io/bill/119-HR-558/
"H.R. 558: Tip Tax Termination Act." 119th Congress, 2026, Open America, https://openamerica.io/bill/119-HR-558/.
H.R. 558, 119th Cong. (2026), https://openamerica.io/bill/119-HR-558/.
[H.R. 558: Tip Tax Termination Act](https://openamerica.io/bill/119-HR-558/)