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No Tax on Large Party Tips: New Rules for Restaurants

This act clarifies that tips automatically added to a bill or suggested by a business are considered voluntary. This means employees receiving such tips may benefit from tax deductions, potentially impacting their income and tax obligations.
Key points
Tips automatically added to a customer's bill will be treated as voluntarily paid.
Suggested tips prompted by a business will also be considered voluntary.
This change may affect how employees and employers handle tip taxation.
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Status: Introduced
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Additional Information
Print number: 119_S_2780
Sponsor: Sen. Gallego, Ruben [D-AZ]
Process start date: 2025-09-11
System Note: Lustra is free, publicly auditable civic infrastructure — full source code available on GitHub. You are reading sterilized legislative data, processed by our radical neutrality engine to strip political spin and retain factual mechanics. We process only official government data. Original documents remain the authoritative source—always verify them if you can.
Summarized by: gemini-2.5-flash-preview-05-20
Source data: api.congress.gov
AI work logs for this document launch

OFFICIAL LEGAL TITLE

No Tax on Large Party Tips Act

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 119_S_2780.

Which chamber initiated this legislation?

This legislation was initiated in the Senate.

When did the legislative process begin?

The process officially started on 2025-09-11.

What are the main provisions?

Key points include:

  • Tips automatically added to a customer's bill will be treated as voluntarily paid.
  • Suggested tips prompted by a business will also be considered voluntary.
  • This change may affect how employees and employers handle tip taxation.
What is the specific legal status?

The current status is Introduced.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Sen. Gallego, Ruben [D-AZ].

What is the latest detailed status?

The latest detailed status is: Introduced in Senate

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2025-12-23.

What is the impact of this bill?

We don't know—that is up to you to decide. Summarizing raw data with AI is fundamentally different from predicting socio-economic outcomes. As of 2026, we believe impact assessment strictly requires a human in the loop to verify and judge.

CATEGORIES

Taxes Labor