What is the story about?
What's Happening?
The Trump administration has released a list of occupations exempt from federal income tax on tips under the new tax cuts and spending bill. This list includes traditional tipped jobs like food service workers and unexpected ones like podcasters and social media influencers. The provision, effective from 2025 to 2028, applies to individuals earning less than $160,000 annually. The exemption aims to benefit lower-income workers, though it may increase the deficit by $40 billion through 2028.
Why It's Important?
The inclusion of podcasters and influencers in the 'No Tax on Tips' plan reflects the evolving nature of the workforce and the recognition of non-traditional jobs. While the exemption aims to support lower-income workers, it raises concerns about its impact on the federal deficit. The plan may incentivize shifts towards tipped employment, affecting labor market dynamics. Public opinion is mixed, with many Americans believing the tax law favors the wealthy and may not significantly benefit low-income individuals.
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