The "no tax on tips" provision within the Senate version of the One Big Beautiful Bill Act allows tipped workers to deduct tip income from their federal taxable income, up to $25,000 annually. The deduction phases out for individuals earning more than $150,000 and couples earning over $300,000.

The Budget Lab at Yale University estimated Monday that effects from the bill on taxes, Medicaid and spending on the federal SNAP food stamps program would cost the lowest-earning 20% of Americans

The measure would extend trillions of dollars in tax cuts from Trump’s first term and implement new campaign promises while spending billions on immigration enforcement.