Disclaimer: This article is for educational purposes only and is not tax, legal, or financial advice. Tax rules change periodically, always check current IRS/state guidance or consult a professional.
Tip Tracker (Server44)
Quick Answer: Is Your Job on the IRS List?
On April 13, 2026, Treasury and the IRS published the final rule (TD 10044, 26 CFR §1.224-1) listing every occupation that qualifies for the No Tax on Tips deduction under IRC §224. The list covers 70+ jobs grouped into eight Treasury Tipped Occupation Code (TTOC) categories, numbered 100 through 800.
If your exact job title (or a close synonym) appears on the list, you can deduct up to $25,000 in qualified tips from your federal taxable income for tax years 2025 through 2028. If your occupation is not listed, the final rule does not allow a facts-and-circumstances workaround. You are not eligible.
Key Takeaways
- The list is closed. The IRS rejected a facts-and-circumstances test. If your occupation is not in the 70+ jobs across the 8 TTOC categories, you cannot claim the §224 deduction.
- Eight TTOC categories (100s through 800s). Beverage and Food Service, Entertainment and Events, Hospitality, Home Services, Personal Services, Personal Appearance and Wellness, Recreation and Instruction, and Transportation and Delivery.
- Three final-rule additions. Visual artists and floral designers were added to the 500s; gas pump attendants were added to the 800s.
- Digital content creators are in. Podcasters, streamers, and social media influencers qualify under the 200s, but only voluntary tips and gifts count. Subscription revenue does not.
- App-based delivery workers are in. DoorDash, Uber Eats, Instacart, and similar platform couriers are explicitly listed in the 800s.
- Still taxable for FICA and (usually) state tax. The deduction cuts federal income tax only. Social Security and Medicare still apply, and most states have not conformed.
What Section 224 Actually Does
Section 70201 of the One Big Beautiful Bill Act (P.L. 119-21) added a new Internal Revenue Code §224. It creates an above-the-line deduction, meaning you get it whether or not you itemize, for qualified tips received by workers in listed occupations.
The core numbers
- Maximum deduction: $25,000 per return, per year
- Phase-out start: $150,000 modified adjusted gross income (single, head of household, married filing separately) or $300,000 (married filing jointly)
- Phase-out rate: $100 reduction for every $1,000 of MAGI over the threshold
- Full phase-out: roughly $400,000 MAGI single, $550,000 joint, derived from the formula
- Effective dates: tax years 2025 through 2028, then the provision sunsets unless Congress extends it
What the deduction does not do
Section 224 cuts your federal income tax only. It does not:
- Reduce FICA (6.2% Social Security + 1.45% Medicare) on tip income
- Change your duty to report tips of $20 or more per month to your employer
- Automatically reduce your state income tax. Most states have not conformed, so tips stay fully taxable at the state level unless your state passed its own carve-out
Married filers have to file jointly to claim the deduction, and the return has to include a valid Social Security number. A missing or incorrect SSN is treated as a mathematical error, which means the IRS can deny the deduction without a full examination.
The IRS Final Rule in Plain Language
On April 13, 2026, Treasury and the IRS published TD 10044 in the Federal Register (document 2026-07104), finalizing the regulations at 26 CFR §1.224-1. The final rule does three important things.
1. It closes the list
The statute says §224 applies to occupations that "customarily and regularly received tips on or before December 31, 2024." Industry groups pushed for a facts-and-circumstances test so other jobs could qualify by showing tipping was common in their field. The final rule rejected that approach. If your occupation is not on the official list, you cannot claim the deduction, even with payroll data showing tipping was normal in your industry.
2. It organizes jobs into eight TTOC categories
Every listed occupation has a three-digit Treasury Tipped Occupation Code (TTOC). The first digit signals the category (100 through 800), and the remaining two digits identify the specific job. Starting with the 2026 tax year, your W-2 will show your TTOC in the new Box 14b, and your qualified tips will appear in Box 12 with code "TP".
3. It adds three borderline occupations
Between the proposed and final rules, the IRS added visual artists and floral designers to the personal services category (500s), and gas pump attendants to the transportation category (800s). It also clarified that app- or platform-based delivery workers (DoorDash, Uber Eats, Instacart, Grubhub couriers) and digital content creators (podcasters, streamers, influencers) were always intended to be included.
The 8 IRS Categories and Complete Occupation List
Here is every occupation on the final IRS list, organized by TTOC category. Use Ctrl+F (or Cmd+F on Mac) to search for your job title.
100s, Beverage and Food Service
The biggest category by headcount. Covers front-of-house and back-of-house in restaurants, bars, cafes, and catering.
- Bartenders
- Wait staff (servers)
- Non-restaurant food servers (caterers, room service)
- Chefs and head cooks
- Cooks (line, short-order, institutional)
- Food preparation workers
- Fast-food and counter workers (baristas, deli clerks)
- Dishwashers
- Dining room and cafeteria attendants (bussers)
- Bartender helpers (barbacks)
- Hosts and hostesses
- Bakers
200s, Entertainment and Events
Live entertainment, gaming floors, and the newly clarified creator economy.
- Gambling dealers
- Change persons and booth cashiers
- Gambling cage workers
- Sports book writers and runners
- Dancers
- Musicians and singers
- DJs and disc jockeys
- Entertainers and performers
- Digital content creators (podcasters, streamers, social media influencers)
- Ushers, lobby attendants, and ticket takers
- Locker room and coatroom attendants
300s, Hospitality and Guest Services
Hotel, motel, and resort positions where guests customarily tip for service.
- Baggage porters and bellhops
- Concierges
- Hotel, motel, and resort desk clerks
- Maids and housekeeping cleaners
400s, Home Services
Trades and maintenance workers who receive voluntary tips from homeowners.
- Maintenance and repair workers (general)
- Landscapers and groundskeepers
- Electricians
- Plumbers, pipefitters, and steamfitters
- HVAC mechanics and installers
- Appliance installers and repairers
- Home cleaners (non-housekeeping staff)
- Locksmiths
- Roadside assistance workers
500s, Personal Services
One-on-one service providers. This is where two of the three final-rule additions landed.
- Personal care and service workers (general)
- Event planners
- Photographers
- Videographers
- Officiants
- Pet caretakers, pet sitters, and dog walkers
- Tutors
- Nannies and babysitters
- Visual artists (added in the final rule)
- Floral designers (added in the final rule)
600s, Personal Appearance and Wellness
Salon, spa, gym, and body-art workers.
- Skincare specialists and estheticians
- Massage therapists
- Barbers
- Hairdressers and hairstylists
- Shampooers
- Manicurists and pedicurists
- Eyebrow threading and waxing technicians
- Makeup artists
- Exercise trainers and group fitness instructors
- Tattoo artists
- Tailors and custom sewers
700s, Recreation and Instruction
Guides, instructors, and leisure-activity workers.
- Golf caddies
- Self-enrichment teachers (art, music, cooking classes)
- Recreational pilots
- Tour guides
- Travel guides
- Sports and recreation instructors (ski, surf, tennis)
800s, Transportation and Delivery
Drivers, couriers, and movers. The most recent final-rule add landed here too.
- Parking lot attendants and valets
- Taxi drivers and rideshare drivers (Uber, Lyft)
- Chauffeurs
- Shuttle drivers
- Delivery persons (restaurant, florist, courier)
- App- and platform-based delivery workers (DoorDash, Uber Eats, Instacart, Grubhub)
- Vehicle cleaners and washers
- Bus drivers (charter and tour)
- Water taxi operators
- Movers and packers
- Gas pump attendants (added in the final rule)
Log your cash tips nightly so the numbers you claim match what you actually earned. Tip Tracker timestamps every entry, so you have contemporaneous records if the IRS asks.
Borderline and Final-Rule Additions Worth Knowing About
Three additions and two clarifications in the final rule are worth a closer look because they answer questions that dominated public comments.
Visual artists and floral designers (500s)
A tattoo artist was already covered under the 600s, but painters, illustrators, and other visual artists were left out of the proposed rule. The final rule fixed that. Floral designers, frequently tipped by brides and event clients, were also added. If you run a studio practice and sell originals or commissions, voluntary tips from clients now qualify.
Gas pump attendants (800s)
Only two states (New Jersey and parts of Oregon) still mandate full-service gas stations. But tipping attendants is customary in those regions, and the final rule made the occupation explicit so attendants in those states are not boxed out by a technicality.
Digital content creators (200s)
The preamble to the final rule clarifies that podcasters, streamers (Twitch, YouTube, Kick), and social media influencers fall under "digital content creators" in the 200s. Critically, only voluntary viewer tips and gifts (Super Chats, bits, Venmo tips, cash-app gifts) qualify. Subscription revenue does not. Patreon dues, Twitch subscriptions, and YouTube channel memberships are treated as fees for ongoing service, not tips.
App- and platform-based delivery workers (800s)
A DoorDash or Instacart driver is a "delivery person," but the proposed rule did not spell that out. The final rule adds an explicit category so couriers working through the major apps have no doubt: tips received through the in-app tip line qualify.
What is still a judgment call
A few fringe cases remain gray. Etsy sellers who accept voluntary gratuities, OnlyFans creators (likely fall under digital content creators, but the final rule does not name the platform), personal shoppers who aren't also couriers. If you are in one of those edges, the safest move is to keep thorough records and talk to a tax professional who has read TD 10044.
Who Does NOT Qualify (Common Misconceptions)
The list is closed. If your occupation is not in the 8 TTOC categories above, your tips do not qualify, full stop. A few other exclusions catch people who otherwise look eligible.
Workers at a Specified Service Trade or Business (SSTB)
The statute excludes tips earned at an employer that is an SSTB under §199A(d)(2): health, law, accounting, actuarial, performing arts, consulting, athletics, financial services, brokerage, and any business whose principal asset is the reputation or skill of its employees or owners.
Transition relief under Notice 2025-69: the IRS has suspended the SSTB disqualification until SSTB-specific final regulations are issued. For 2025 returns, you can still claim the deduction even if your employer is an SSTB. Watch for updated guidance before filing 2026 returns.
Service charges and automatic gratuities
These never count as tips, in any year, under any rule.
- Mandatory 18% or 20% on large parties
- Banquet and catering service charges
- Cruise-line gratuities that are automatically added to your bill
- Room-service delivery fees that the customer cannot waive
- Pre-set "tip suggestions" on a point-of-sale screen count only if the customer voluntarily chose the amount. A forced option does not qualify
Tips paid in digital assets or crypto
The final rule explicitly excludes tips paid in cryptocurrency, stablecoins, or any other digital asset. Only tips paid in U.S. cash, credit-card charges, or through tip-distribution apps that settle in U.S. dollars qualify.
Negotiated amounts
If the customer and worker agreed on a price in advance (a set fee for a private event, a pre-agreed wedding videographer payment), it is compensation for services, not a tip, even if it is called "a tip" on the invoice.
High earners above the phase-out ceiling
The phase-out cuts the deduction by $100 per $1,000 of MAGI over the threshold. Running the math:
- Single / HOH / MFS: a $25,000 deduction phases out completely at roughly $400,000 MAGI
- Married filing jointly: phases out completely at roughly $550,000 MAGI
If your MAGI exceeds those ceilings, the deduction is zero even if your job is on the list.
How to Claim It: W-2 Codes, Form 4137, and Schedule 1-A
Reporting mechanics differ between the 2025 transition year and the 2026-and-later regime.
Tax year 2025 (file in early 2026)
Under Notice 2025-69, the IRS permits a transition rule: a "reasonable approximation" of tips is allowed because employer payroll systems did not have time to generate the new W-2 boxes. You claim the deduction on the new Schedule 1-A, Part II, attached to Form 1040. Your own daily tip log is the backbone of a reasonable approximation.
Tax year 2026 and later
W-2 forms issued for 2026 wages will show qualified tips in Box 12 with code "TP" and your three-digit TTOC in the new Box 14b. You will carry those amounts to Schedule 1-A. No more "reasonable approximation". The W-2 drives the figure.
Self-employed and 1099 workers
If you report tips on a 1099-NEC, 1099-MISC, or 1099-K (including platform payouts from DoorDash, Uber, or Instacart), the occupation code attaches at the return level. You enter qualified tips on Schedule 1-A and back into your occupation category. Expect extra hurdles: the net income limitation and the SSTB test, which are both designed to block recharacterization abuse.
Form 4137 for unreported tips
Tips you did not report to your employer but owe tax on are reconciled on Form 4137 (Social Security and Medicare Tax on Unreported Tip Income). Those amounts can also flow to Schedule 1-A, subject to the same cap and phase-out.
Other filing mechanics
- A valid Social Security number is required. A missing or incorrect SSN is treated as a math error, and the IRS can deny the deduction without opening a full audit
- Married filers have to file jointly to claim §224
- The deduction is above the line, so you get it whether you itemize or take the standard deduction
If you have not been logging tips shift by shift, start tonight. Tip Tracker gives every entry a date stamp and keeps cash tips separate from charged tips, which is exactly the contemporaneous record the IRS wants to see if it questions your Schedule 1-A amount.
Is My Job on the List? Worked Examples
Four common scenarios showing how the final rule applies in practice. Use these to sanity-check your own situation.
- Job title: Barista
- TTOC category: 100s, Beverage and Food Service
- Matches listing: Fast-food and counter workers
- Qualifies for §224 deduction? Yes
- What counts: Cash tips in the jar, charged tips on card transactions, tip-pool share from other shifts
- What does not count: Mandatory service charges for catering orders, hourly wages, bonuses
A full-time barista earning $8,000 in tips on top of $28,000 in base wages can deduct the full $8,000 because it is under the $25,000 cap and AGI is far below $150,000.
- Job title: App-based delivery driver
- TTOC category: 800s, Transportation and Delivery
- Matches listing: App- and platform-based delivery workers
- Qualifies for §224 deduction? Yes, but as a self-employed 1099 worker, subject to the net income limitation and SSTB test
- What counts: In-app tips added by customers
- What does not count: Base delivery pay, peak-pay bonuses, platform referral rewards
A courier with $6,000 in in-app tips and $18,000 in platform base pay reports the $6,000 on Schedule 1-A, assuming the delivery work is not an SSTB (it is not) and net self-employment income is positive.
- Job title: Digital content creator
- TTOC category: 200s, Entertainment and Events
- Matches listing: Digital content creators (podcasters, streamers, social media influencers)
- Qualifies for §224 deduction? Yes, but only on voluntary viewer tips
- What counts: Twitch bits, Super Chats, YouTube Super Thanks, one-off Venmo or Cash App gifts from viewers
- What does not count: Subscription revenue (Twitch subs, YouTube channel memberships, Patreon dues), ad revenue, sponsorship fees
A streamer with $15,000 in bits, $40,000 in sub revenue, and $10,000 in sponsorships deducts $15,000. Only the viewer-tip portion qualifies.
- Job title: Pharmacy technician
- TTOC category: None
- Matches listing: No
- Qualifies for §224 deduction? No
Even if customers occasionally leave a few dollars with a "thank you" at pickup, pharmacy technician is not on any TTOC list. The final rule closed the door on facts-and-circumstances arguments, so there is no path to qualify. Any tips received are ordinary income and get no §224 deduction.
Frequently Asked Questions
Troubleshooting and Tips
- Confirm your TTOC with your employer before December. Starting with 2026 W-2s, Box 14b shows your TTOC. Ask HR which code they plan to use so you can check it against the list before the W-2 is finalized.
- Keep cash tips separate from charged tips in your log. Charged tips flow through payroll and show up automatically; cash tips depend on your own records. Separating them makes Schedule 1-A reconciliation easier.
- Save screenshots of in-app tip summaries. DoorDash, Uber Eats, and similar platforms show tip totals in your earnings dashboard. Download or screenshot weekly so you have a backup if the platform report changes or is deleted.
- Flag SSTB concerns early if you work in law, health, or performing arts. Notice 2025-69 suspended the SSTB disqualification for 2025, but the permanent rule is still being written. If you work at an SSTB employer, watch for updated guidance before filing 2026 and 2027 returns.
- Ignore "facts-and-circumstances" advice. Some older articles wrote as if non-listed occupations could make a case under a facts test. The final rule killed that option. If your job is not on the list, do not claim the deduction.
- Watch for the 2028 sunset. Section 224 expires after the 2028 tax year unless Congress extends it. Budget with the assumption the deduction goes away, and log tips every year so you capture the full benefit while it is in effect.
References
- IRS Final Rule Announcement (TD 10044) — IRS press release introducing the final regulations listing qualifying tipped occupations under IRC §224.
- Federal Register, Final Rule (TD 10044, Document 2026-07104) — Full text of the final regulations at 26 CFR §1.224-1, published April 13, 2026.
- IRS Notice 2025-69, 2025 Transition Guidance — Transition rules for the 2025 tax year, including the reasonable-approximation method and SSTB transition relief.
- 26 U.S. Code §224 (Cornell Legal Information Institute) — Statutory text of the qualified tip deduction enacted by One Big Beautiful Bill Act §70201.
- IRS Tipped Occupations Reference Page — Official IRS reference page listing every qualifying occupation and its Treasury Tipped Occupation Code.
- IRS, How to Take Advantage of No Tax on Tips and Overtime — Practical taxpayer-facing guide covering W-2 Box 12 code TP, Box 14b TTOC, and Schedule 1-A filing mechanics.