Washington, D.C. – U.S. Senator Catherine Cortez Masto (D-Nev.) celebrated the Senate passage of her bipartisan bill to exempt tipped wages from federal income tax. Thanks to the state’s world class service and hospitality industries, Nevada has the highest concentration of tipped workers in the country, and the No Tax on Tips Act will allow these workers to keep more of their hard-earned money. Cortez Masto encourages her colleagues in the House of Representatives to move forward with a clean version of this legislation, instead of attaching it to their harmful billionaire tax plan that cuts Medicaid and raises taxes on the working class.
“I’m happy to work with anyone on legislation that’s going to improve Nevadans’ lives, and I’m pleased that my bipartisan bill to put more money in the pockets of hardworking Nevadans has passed the Senate,” said Senator Cortez Masto. “Tipped workers are the backbone of Nevada’s economy, and with prices skyrocketing, working families deserve this break. I hope the House of Representatives passes this bill that permanently ends federal taxes on tips, instead of House Republicans’ unserious version that sunsets no taxes on tips in just four years while gutting health care for the very working families they say they are standing with.”
The bill exempts “cash tips” – cash, credit and debit card charges, and checks – from federal income tax by allowing taxpayers to claim a 100% deduction at filing for tipped wages. The updated text includes guardrails and income limits to ensure only traditionally tipped employees will benefit from No Tax on Tips. The legislation is cosponsored by Ted Cruz (R-Texas), Jacky Rosen (D-Nev.), Steve Daines (R-Mont.), and Pete Ricketts (R-Neb.).
This bill is just a piece of Senator Cortez Masto’s robust efforts to cut taxes and lower costs for hardworking Nevadans. Senator Cortez Masto helped introduce the Working Families Tax Relief Act to lower taxes for Nevada families by expanding the Child Tax Credit and Earned Income Tax Credit. Additionally, she supports raising the federal minimum wage and eliminating the minimum wage gap for tipped workers nationally. Nevada is one of seven states that already requires employers to pay tipped workers the full minimum wage rather than a sub-minimum wage.
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