No Tax on Overtime and Tips, and “Trump Accounts”
IRS Guidance for Individuals Who Received Tips or Overtime In 2025
On November 21, the Department of the Treasury and the Internal Revenue Service issued guidance for workers eligible to claim the deduction for tips and for overtime compensation for tax year 2025.
“Notice 2025-69 clarifies for workers how to determine the amount of their deduction without receiving a separate accounting from their employer for cash tips or qualified overtime on information returns such as Form W-2 or Form 1099, as those forms remain unchanged for the current tax year. … The IRS is in the process of updating income tax forms and instructions for taxpayers to use this filing season that will assist them in claiming these deductions.”
Initial Guidance for “Trump Accounts”
On December 2, the Department of the Treasury and the Internal Revenue Service issued a notice announcing upcoming regulations and providing guidance regarding Trump Accounts, a new type of individual retirement account (IRA) for eligible children.
The notice “provides a general overview of how Trump Accounts work and addresses certain initial questions about creating initial and rollover Trump Accounts, the $1,000 pilot program contribution, other contributions—including qualified general contributions and section 128 employer contributions—eligible investments, distributions, reporting, and coordination with the rules applicable to other types of IRAs.”
Source: irs.gov
