Bill 119 s 129, also known as the "Tip Income Protection Act," aims to make changes to the Internal Revenue Code of 1986 in order to eliminate the income tax on qualified tips. The bill proposes to achieve this by allowing all individual taxpayers to deduct their tips from their taxable income.
The main goal of this legislation is to provide relief to individuals who rely on tips as a significant portion of their income, such as restaurant servers, bartenders, and other service industry workers. By allowing these individuals to deduct their tips from their taxable income, the bill seeks to ensure that they are not unfairly taxed on income that is often unpredictable and can vary greatly from month to month.
In addition to eliminating the income tax on tips, the bill also includes provisions for other purposes, although specific details on these provisions are not provided in the summary. Overall, the Tip Income Protection Act aims to provide much-needed financial relief to individuals who rely on tips as a significant source of income, and to ensure that they are not burdened with unnecessary taxes on this income.