What’s at Stake for Tipped Workers
A Major Victory for Workers Relying on Tips
According to NYPost, Congressman Steven Horsford is introducing a new law called the “TIPS Act”. This law would increase the minimum wage for all workers to $12 an hour. It would also make sure that tips are not taxed as income. Many people, including those who work in the food service industry, are supporting this idea.
According to tax experts, tipped workers could gain an average of $20,000 to $30,000 in tax-free income each year if the bill becomes law. Another $1,500 or so could go back to workers if those tips are exempted from Social Security and Medicare assessments. The move is seen as a major victory for workers who rely on tips for most of their income, with nearly 6 million American workers representing almost 6% of the workforce relying on tips.
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Tipping Point: Should Tipped Workers Get Tax-Free Income? (PHOTO: GOOGLE)
Debate Surrounds Tax-Free Income for Tipped Workers
Some people don’t agree that the plan is a good idea. Howard Gleckman, a tax expert, thinks it’s not fair to let servers get tax-free income when others who work hard for low wages have to pay taxes. This shows that there are many sides to this issue, and we need to think carefully about any changes to the tax rules.
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