The Tip Relief Act

A federal tax deduction for Americans supporting the modern service economy

Overview

In today’s economy, tipping is everywhere — from restaurants and bars to coffee shops, food trucks, hair salons, delivery apps, and even retail counters and self-checkout kiosks. This cultural shift, often called “tipflation,” is pressuring millions of Americans to tip generously in nearly every transaction.

The result? Consumers are effectively subsidizing wages, while corporations pass the buck, and businesses still get to write off gratuities as deductible expenses.

Meanwhile, everyday Americans — especially working- and middle-class families — get no tax relief at all.

That needs to change.

We’re calling on Congress to introduce a bill called the Consumer Tipping Relief Act, which would allow individuals to claim a federal tax deduction or credit (up to a capped amount) for tips paid to service workers throughout the year.

This policy would:

Help consumers cope with rising costs from tipping expectations
Encourage continued support for service workers in underpaid industries
Treat tips as what they’ve become: voluntary donations to the modern labor economy

If a business can write off tipping expenses, individuals should be able to as well.

We urge our elected officials to act now — and support American consumers who have been doing their part without any support from the tax code.

Proposal

The Tip Relief Act would allow individuals to claim a federal tax deduction or credit for verified personal tips paid throughout the year.

Proposed guidelines:

 • Deduction or refundable credit up to $2,000 per year

 • Applies to non-business-related tips across any legal service industry

 • Requires digital or itemized proof (receipts, app history, etc.)

 • Includes baristas, delivery drivers, rideshare workers, stylists, hotel workers, and other tipped service roles

Purpose

This policy provides fairness to consumers who are informally subsidizing labor through tipping. It incentivizes continued generosity while easing financial pressure on the working and middle class. It also updates outdated federal tax treatment of gratuities in the digital economy.

Benefits

 • Provides targeted tax relief to consumers impacted by “tipflation”

 • Encourages continued support for service workers

 • Modernizes tax law to reflect real economic behavior

 • Gains bipartisan appeal as both taxpayer and labor-friendly reform

What You Can Do:

Sign and share this petition

Email your representatives and link to this page
Use #WriteOffTips and #TipReliefAct on social media to build momentum