Who’s in the Tip-Free Tax Zone? IRS Previews Jobs Eligible for 2025 Break

Big news for workers who rely on tips: a new federal income tax break could mean more money in your pocket — if you meet the cut.

As part of the One Big Beautiful Bill Act (OBBBA), the IRS and U.S. Treasury are preparing to roll out a federal tax exemption on tip income for workers in select industries. While the finalized list of eligible occupations won’t be released until October 2, 2025, a preliminary list has already been shared to give workers and tax professionals a heads-up.

So, who’s likely to qualify?

The new tax break applies to those in jobs where tips are customarily and regularly received as of December 31, 2024. The IRS has grouped 68 occupations into eight broad categories, including:

  • Food & Beverage – Servers, bartenders, baristas
  • Transportation – Rideshare and taxi drivers, valets
  • Hospitality – Hotel staff, bellhops, concierges
  • Entertainment – DJs, casino dealers, performers
  • Personal Services – Hairstylists, nail technicians, estheticians
  • Home Services – Movers, cleaners, landscapers
  • Wellness & Recreation – Spa workers, fitness instructors, golf caddies
  • Tourism & Guides – Tour guides, cruise staff, etc.


Even social media influencers may be eligible if they receive gratuities or digital tips from followers.

Not everyone makes the cut

Industries that don’t typically receive tips — like healthcare, education, or traditional performing arts — are not included in the proposed eligibility.

There are also income caps in place:

  • $150,000 for individuals
  • $300,000 for joint filers


And just like always with the IRS, reporting matters. To qualify, tips must be properly reported and documented. No under-the-table stuff — clean records will be key.

Why this matters now

Although the break doesn’t take effect until 2025, it’s crucial to start preparing now. If you or your clients work in a tip-based industry, now is the time to:

  • Start tracking tips carefully
  • Use digital payment systems where possible
  • Work with a tax pro to ensure you meet the criteria
  • Watch for the final list from the IRS this fall


At Sunshine Tax Relief, we’re staying on top of every change tied to OBBBA so you don’t have to. If you’re in a tip-heavy role and want to make sure you’re positioned to benefit, schedule a consult with us today. We’ll help you plan ahead so you’re ready when the law kicks in.

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