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Trump Promised ‘No Tax on Tips.’ Then Came the Fine Print.​

The proposal, which Congress passed as part of the president’s tax-and-spending megabill, won’t eliminate taxes on tips entirely​


🎁—> https://www.wsj.com/personal-financ...2?st=guhMcG&reflink=desktopwebshare_permalink

“… Among the particulars restricting the reach of the measure: Only the first $25,000 in tips are free from income taxes. Tipped workers will still face the 7.65% combined payroll taxes that fund Social Security and Medicare. And workers won’t be able to benefit if federal officials say their type of service job doesn’t qualify.

… Even though it is one of the smaller pieces of the law in terms of dollars—accounting for $32 billion out of $4.5 trillion in tax cuts—it is one of Republicans’ top talking points.

The cut could save some service workers thousands of dollars a year in federal taxes.

… To hold on to their gratuities, some workers already illegally skip reporting the income to avoid paying taxes on it.

… More than a third of tipped workers don’t make enough to pay federal income taxes, … They wouldn’t benefit from the no-tax-on-tips deduction.

… workers who do pay federal income taxes will be able to deduct up to $25,000 for tips. For someone in the 12% tax bracket making that much in tips, the change would deliver up to $3,000 in savings. The deduction would start phasing out once an individual’s income reaches $150,000, or $300,000 on a joint return for people who are married.

… The law orders the Treasury secretary to publish a list of typical tip-earning jobs that qualify for the deduction, so it is unclear now exactly who will benefit.…”
 
nycfan said:

Trump Promised ‘No Tax on Tips.’ Then Came the Fine Print.​

The proposal, which Congress passed as part of the president’s tax-and-spending megabill, won’t eliminate taxes on tips entirely​


🎁—> https://www.wsj.com/personal-financ...2?st=guhMcG&reflink=desktopwebshare_permalink

“… Among the particulars restricting the reach of the measure: Only the first $25,000 in tips are free from income taxes. Tipped workers will still face the 7.65% combined payroll taxes that fund Social Security and Medicare. And workers won’t be able to benefit if federal officials say their type of service job doesn’t qualify.

… Even though it is one of the smaller pieces of the law in terms of dollars—accounting for $32 billion out of $4.5 trillion in tax cuts—it is one of Republicans’ top talking points.

The cut could save some service workers thousands of dollars a year in federal taxes.

… To hold on to their gratuities, some workers already illegally skip reporting the income to avoid paying taxes on it.

… More than a third of tipped workers don’t make enough to pay federal income taxes, … They wouldn’t benefit from the no-tax-on-tips deduction.

… workers who do pay federal income taxes will be able to deduct up to $25,000 for tips. For someone in the 12% tax bracket making that much in tips, the change would deliver up to $3,000 in savings. The deduction would start phasing out once an individual’s income reaches $150,000, or $300,000 on a joint return for people who are married.

… The law orders the Treasury secretary to publish a list of typical tip-earning jobs that qualify for the deduction, so it is unclear now exactly who will benefit.…”
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I suppose the risk you take if you have t been reporting most or all of your tips over the years is reporting them now for the tax break you (a) have to pay FICA taxes on the tips and (b) create a record that could be used against you if you are ever audited for a prior or future year (the break expires after 2028) if you only report tips during the tax break period (though the risk of an IRS is extremely low, so I guess sort of a taxes Russian roulette situation).

There will be pressure on employers to break out tips (paid via credit card etc) from other income so employee can claim the tax break. Not clear how it will work in places where tips are shared among staff — or how employers usually report income in those cases (previously, there would have been no reason to separate the tips from the wages).
 
nycfan said:




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That last one is the key. The Pubs are assuming that by the time it becomes clear their absurd growth projections are farcical, the Dems will be in charge again. And they'll then blame the Dems for the lower than projected growth. And the American idiocracy will lap it up, like they have over and over again for the last 40+ years.
 
lawtig02 said:
That last one is the key. The Pubs are assuming that by the time it becomes clear their absurd growth projections are farcical, the Dems will be in charge again. And they'll then blame the Dems for the lower than projected growth. And the American idiocracy will lap it up, like they have over and over again for the last 40+ years.
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Above 3% growth would be great (but exponential?). Presumably they think the growth will be front-loaded rather than compounding but maybe they are even more pie in the sky than I knew.
 
Molotov Mocktail said:
Trump now has a private masked police force with billions of dollars at its disposal. Do you think that force isn’t going to play a role in the next election? I’m really fucking worried about what we’re going to witness and experience relatively soon.
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We pull the masks off and show the world who they are. We will not, we cannot let them win another another term. Ever.
 
WaynetheDrain said:
Keep being submissive while autocracy takes hold of our government. That’s what they rely on.
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Sure. If only we had some other method of getting rid of these elected representatives that we don't like... just like every other election, including the ones where people didn't think one party or the other was going to give up power if they lost.
 
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