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Senate unanimously passes No Tax on Tips Act
By lauraharris // 2025-05-25
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  • The Republican-led Senate passed the No Tax on Tips Act with rare bipartisan support, introduced by Sen. Ted Cruz (R-TX) and co-sponsored by Nevada Democrats Sens. Jacky Rosen and Catherine Cortez Masto.
  • No Tax on Tips Act creates a tax deduction of up to $25,000 for reported tips, benefiting workers earning ≤$160,000 (adjusted for inflation). It eliminates federal taxes on tips for hospitality workers, servers and other tipped employees.
  • Nevada, with its high percentage of tipped workers, was a key motivator for the bill. Rosen emphasized its immediate financial relief for service workers who rely on tips as essential income.
  • If enacted, the law takes effect in 2025. The House is expected to vote soon, positioning it as a pre-election win for both parties.
  • The bill aligns with Trump's 2024 pledge to eliminate taxes on tips, which he highlighted in Nevada, a critical swing state with a large service-industry workforce. Democrats and Republicans, including Schumer and Cruz, praised the bipartisan collaboration.
The Republican-led Senate has passed a bill that would eliminate federal tax on tips in a rare show of bipartisan agreement. No Tax on Tips Act, introduced in January by Sen. Ted Cruz (R-TX) and co-sponsored by Nevada's Democratic Sens. Jacky Rosen and Catherine Cortez Masto, creates a tax deduction of up to $25,000 for tips reported to employers for payroll tax purposes. The benefit is limited to workers earning $160,000 or less in 2025, with the income threshold adjusting for inflation in subsequent years. (Related: Trump Administration considers raising taxes on wealthiest Americans to fund tip wage tax cut.) The bill, which eliminates federal taxes on tips for hospitality workers, servers and other tipped employees, advanced after Rosen brought it to the floor with no objections from either party. The House is expected to take up the bill in the coming weeks. If enacted, the law would take effect in 2025, offering relief to millions of bartenders, waitstaff, hotel employees and other service workers ahead of the next election cycle.

Trump fulfills campaign promise

The passage of the No Tax on Tips Act fulfills President Donald Trump's promise to eliminate taxes on overtime wages and Social Security benefits during his 2024 presidential campaign. Trump first introduced the campaign promise during his stop in Nevada. At that time, he promised that these tax cuts would be a top priority for his administration. Nevada, being home to the nation's highest percentage of tipped workers, has been a focal point in the push for tax-free tips. "I just want to say: This is great news for Nevada," Rosen said, in celebration of the passage. "This bill is not the be-all, end-all, but it's going to offer immediate financial relief while the Senate continues to work to lower costs and find other avenues of relief for hardworking families. Nevadans, our families, are being squeezed and we need real relief. For some, many service and hospitality workers, tips aren't extra, it's part of their income that they use to make ends meet." Cruz, along with Senate Minority Leader Chuck Schumer (D-NY), also celebrated the passage of the legislation and credited Rosen. "Whether it passes free-standing or as part of the bigger bill, one way or another, No Tax on Tips is going to become law and give real relief to hard-working Americans," Cruz said. "So I'm proud of what the Senate just did, and I commend Democrats and Republicans, even at a time of partisan division, coming together and agreeing on this commonsense policy." "Working Americans—from servers to bartenders, delivery drivers and everything in between—work hard for every dollar they earn and are the ones who deserve tax relief, not the ultra-rich," Schumer said. But in true Trump-hating fashion, the New York senator decried the president and the GOP – unaware that the real estate mogul was the "stable genius" behind the bill he just voted in favor of. Follow Trump.news for similar stories. Watch this video about Trump's proposed tax reforms and currency devaluation.
This video is from the Brighteon Highlights channel on Brighteon.com.

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Sources include: YourNews.com NYDailyNews.com NBCNews.com Brighteon.com
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