No tax on tips calculator
Estimate your federal deduction for qualified tips, tax years 2025 to 2028.
By the Sproutcalc team · Figures last checked · How we calculate
Your estimated deduction
$18,400
saves about $2,208 in federal income tax
Qualified tips$18,400
Cap$25,000
Income phase-out$0
Net income from that work$0
Your tips are above the cap, so the deduction stops at $25,000.
Your income is above $150,000, so the deduction drops by $100 for each $1,000 over.
If self-employed, the deduction can't be more than net income from that work.
Only tips earned in the occupations on the IRS list count. Tips from a job that isn't on the list don't qualify.
Married couples must file a joint return to claim this deduction.
An estimate, not tax advice. Social Security, Medicare and state tax still apply to tips.
How we calculated this
- Qualified tips, capped at $25,000.
- Above $150,000 MAGI ($300,000 joint), minus $100 for each $1,000 over.
- If self-employed, no more than net income from that work.
- Tax saved = deduction × your bracket.