The tip cap and the MAGI phase-out are the arithmetic the calculator below does for you. Whether your occupation qualifies at all is a different question, and it's the one the calculator can't answer -- it only asks you to confirm it. This page covers what's actually on Treasury's final list, the cutoff date that trips people up, and what does and doesn't count as a "tip" in the first place.
Treasury and the IRS published final regulations on April 13, 2026 (effective June 12, 2026) listing 71 occupations across 8 categories -- more than 200 example job titles in all -- that "customarily and regularly" receive tips. The final list grew from 68 occupations in the September 2025 proposed rule after a public comment period and an October 2025 hearing.
| Category | Example occupations |
|---|---|
| Beverage and Food Service | Bartenders, wait staff, dishwashers, baristas, food servers |
| Entertainment and Events | Musicians, DJs, performers, event staff |
| Hospitality and Guest Services | Concierges, housekeeping staff, bellhops, hotel front desk |
| Home Services | Repair workers, groundskeepers, movers who work directly in the home |
| Personal Services | Event planners, photographers, personal care aides |
| Personal Appearance and Wellness | Hair and makeup stylists, barbers, nail technicians, personal trainers |
| Recreation and Instruction | Tour guides, activity instructors, golf caddies |
| Transportation and Delivery | Taxi and rideshare drivers, movers, delivery workers |
This table is illustrative, not the full list. Before filing, check your specific job title against Treasury's published occupation list and the Treasury Tipped Occupation Code (TTOC) your employer reports.
No, not on tips from that job. Eligibility is not about whether you personally received a tip; it is about whether your occupation customarily and regularly received tips on or before December 31, 2024. A role that only recently started getting tipped, or one that received tips occasionally rather than customarily, does not newly qualify just because a customer left one.
That cutoff is the detail a quick "is my job on the list" search usually misses, because it reads like an occupation test alone. It's actually an occupation-as-practiced-before-2025 test: the question isn't "could someone in this job receive a tip," it's "did this occupation, as a whole, already have a customary practice of tipping before the law existed." Treasury built the list from 2023 tax data, Department of Labor caselaw, and survey data specifically to answer that backward-looking question, not a forward-looking one.
No. A mandatory service charge or automatic gratuity is not a tip under the final regulations, even when the employer later distributes it to the worker -- it is treated as wages, not a customer-given tip. If a customer voluntarily adds an extra amount on top of that mandatory charge, that additional voluntary portion can qualify.
The line the regulations actually draw is who decides the amount. A tip has to be voluntary, with the customer choosing whether to pay it and how much -- paid in cash or a cash-equivalent (check, credit or debit card, gift card, an app that transfers cash value), whether handed over directly or split through a legitimate tip pool. A charge the business sets and adds automatically, however it's later distributed, isn't one. A handheld point-of-sale prompt that offers 15%, 18%, 20%, another amount, or no tip produces a qualified tip either way, because the customer genuinely had the option to leave nothing; a bill that simply adds 18% for parties of six or more does not, because the customer never had that choice.
For $18,000 of qualified tips at a 22% marginal rate and MAGI under the phase-out threshold, the calculator below shows an $18,000 deduction and about $3,960 of estimated federal tax savings if the occupation qualifies -- and $0 of either if it doesn't. The whole deduction turns on that one checkbox.
| Occupation eligibility | Deduction | Estimated savings at 22% |
|---|---|---|
| On Treasury's list | $18,000 | $3,960 |
| Not on the list (or unconfirmed) | $0 | $0 |
Nothing else about the return changes between those two rows -- same tips, same MAGI, same marginal rate. Confirming occupation eligibility against the actual published list, rather than guessing, is worth doing before you rely on the larger number.
71 occupations across 8 categories, covering more than 200 example job titles, in the final regulations Treasury and the IRS published on April 13, 2026 (effective June 12, 2026). The list expanded from 68 proposed occupations after a public comment period and an October 2025 hearing.
Starting with tax year 2026, employers report qualified cash tips under code "TP" in Box 12 and your Treasury Tipped Occupation Code (TTOC) in the new Box 14b. For tax year 2025 returns, most filers estimate qualified tips from pay records instead, since the new box didn't exist yet.