Jobs That Qualify for “No Tax on Tips”
The deduction isn't for anyone who happens to receive a tip — the IRS published an official list of occupations that “customarily and regularly” received tips as of the end of 2024. Here's who's on it.
The eight IRS occupation categories
The final IRS list covers roughly 68 occupations grouped into these categories:
- Food & beverage: servers, bartenders, bussers, hosts, baristas, fast-food counter workers, cooks in tipped establishments, delivery drivers.
- Hospitality & lodging: hotel bellhops, housekeepers, concierges, valets, doormen.
- Personal appearance: barbers, hairstylists, nail technicians, estheticians, makeup artists, massage therapists, tattoo artists.
- Transportation & delivery: taxi and rideshare drivers (Uber/Lyft), app delivery drivers (DoorDash, Instacart, Grubhub), shuttle drivers, movers.
- Entertainment & events: casino dealers, DJs, musicians and performers who receive tips, banquet staff, event servers.
- Recreation: golf caddies, ski instructors, tour guides, fishing guides.
- Home services: plumbers, electricians, HVAC and appliance techs, landscapers, locksmiths, home cleaners (where tipping is customary).
- Personal services: pet groomers, personal trainers, babysitters/nannies, tutors in tipped settings.
Both W-2 employees and self-employed/gig workers in listed occupations qualify. If your occupation is on the list, up to $25,000 of reported tips per return is deductible — run your numbers in the tips deduction calculator.
Who's excluded — even with tips
- SSTB workers: employees and self-employed people in "specified service trades" — health, law, accounting, financial services, consulting, athletics, performing arts as a business owner — are excluded by statute even if tipped.
- Occupations not tipped before 2025: the list is frozen to jobs customarily tipped as of Dec 31, 2024 — you can't create a new "tipped" role to capture the deduction.
- Mandatory service charges: auto-gratuities the business adds aren't voluntary tips and don't count, no matter your job.
The paperwork that makes tips count
Only reported tips qualify: tips on your W-2 (reported to your employer), your 1099s, or Form 4137. If you've been under-reporting cash tips, 2026 is the year that habit costs you real money at filing time.
Frequently asked questions
Do DoorDash and Uber tips qualify?
Yes — app-based delivery and rideshare drivers are on the IRS list, and tips reported on your 1099 qualify even though you're self-employed (limited to your net income from that work).
I'm a nurse and patients sometimes give me gifts. Does that count?
No — nursing isn't a customarily tipped occupation on the IRS list, and occasional gifts aren't 'tips customarily and regularly received.'
Do service charges at my restaurant count as tips?
No. Mandatory service charges (auto-gratuity for large parties, banquet fees) are wages, not voluntary tips — only voluntary customer tips qualify.
Is there an income limit?
The deduction phases out above $150,000 MAGI (single) / $300,000 (joint), shrinking $100 per $1,000 over. Most tipped workers get the full deduction.