NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5856
SPONSOR: Durso TITLE OF BILL:
An act to amend the tax law, in relation to establishing a tax deduction
for cash tips received
PURPOSE OR GENERAL IDEA OF BILL:
An act to amend the tax law, in relation to establishing a tax deduction
for cash tips received.
SUMMARY OF PROVISIONS:
Section 1. Subsection (c) of section 612 of the tax law is amended by
adding a new paragraph 48 to read as follows: (48) The amount of cash
tips received during the taxable year which are considered wages or
compensation, as such terms are defined in section six thousand fifty-
three of the internal revenue code.
JUSTIFICATION:
Tip wage earners are the people we see every day. They cut our hair,
serve us meals, deliver our groceries, drive our rideshare, and take our
coffee orders. Most typically, tipped work is in the service and hospi-
tality industry, and tend to be younger than most of the working popu-
lation - 20-34 years old according to the Budget Lab at Yale University.
To help working families and young workers, this bill would eliminate
taxes on tips, thus economically empowering workers. The time has come
for the government to stop taking hard-earned tips from our most vulner-
able employees - tipped workers.
PRIOR LEGISLATIVE HISTORY:
New bill.
SAME AS:
S.587 (Martins)
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
To be determined.
EFFECTIVE DATE:
This act shall take effect immediately and shall apply to all 7 taxable
years beginning on or after January 1, 2025.
