Casino chips are included in ‘no tax on tips’, which benefits Nevada workers
Summary
The U.S. Treasury issued guidance confirming that casino chips count as qualified tips under the new “no tax on tips” policy. That means tips received as tangible chips — along with cash, checks, card payments, gift cards and certain electronic payments — can be deducted from taxable income under the measure.
The guidance also says tip-reporting arrangements used in gaming — such as Tip Rate Determination Agreements (TRDAs) or Gaming Industry Tip Compliance Agreements (GITCAs) that let employers report tips using a fixed rate — are eligible. Automatic gratuities generally remain excluded unless customers can modify or remove them without penalty. Payroll taxes (Social Security and Medicare) are unaffected. The policy allows workers to exclude up to $25,000 of qualified tips from taxable income, phases out above $150,000 of adjusted gross income, and expires at the end of 2028. A public hearing is scheduled for 23 October.
Key Points
- The Treasury guidance explicitly includes casino chips as qualifying tip income under the “no tax on tips” policy.
- Tips paid by cash, cheque, card, gift card, electronic payment and redeemable chips are covered.
- Tip reporting agreements common in gaming (TRDA/GITCA) are eligible, letting workers use fixed-rate reporting and claim the deduction.
- Automatic service charges are excluded unless customers can change or remove them without penalty; selectable charges by customers can qualify.
- Payroll taxes (Social Security and Medicare) are not affected by this change.
- Workers can deduct up to $25,000 of qualifying tips from taxable income; the deduction phases out for higher earners and expires end of 2028.
- The guidance clarifies who will benefit in Nevada — notably bartenders, servers, table-game cashiers and dealers — though many low-income workers may see little change because of existing credits and low tax liability.
Why should I read this?
If you work in a Nevada casino or represent hospitality staff, this could mean extra cash at tax time — and fewer headaches over how tips are reported. Short and simple: chips now count, some automatic charges still don’t, and fixed-rate tip agreements used by the industry are covered. Worth knowing before you file for 2025.
