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Political Playback: California Capitol News You Might Have  Missed  

May 27, 2025

The U.S. Senate unanimously voted to eliminate federal taxes on tips for service workers earning less than $160,000, establishing a tax deduction of up to $25,000 for reported cash tips. California State Senator Rosilicie Ochoa Bogh praised this decision and highlighted her similar state legislation, Senate Bill 17, which aims to end state taxes on service workers' tips. Despite the federal momentum, the California Senate Appropriations Committee placed Ochoa Bogh's bill on the "suspense file" for further consideration of its financial impact on the state.

Who is affected

  • Service workers who earn tips and make less than $160,000 annually
  • Tipped workers' families who experience financial instability due to taxes on inconsistent income
  • California service workers who would benefit from both federal tax relief and potential state tax relief if SB 17 passes

What action is being taken

  • The U.S. Senate has unanimously voted to eliminate federal taxes on tips for service workers
  • California State Senator Rosilicie Ochoa Bogh is advocating for similar legislation at the state level through Senate Bill 17
  • The Senate Appropriations Committee is reviewing the financial implications of SB 17 by placing it on the "suspense file" for further consideration

Why it matters

  • The federal tax deduction would provide relief on up to $25,000 in cash tips for workers earning less than $160,000
  • Tipped workers currently face taxation on unpredictable income, causing financial instability for families already struggling economically
  • The legislation fulfills a campaign promise made by President Trump by codifying tip tax relief into federal law
  • If California passes similar legislation, service workers in the state would receive tax relief at both federal and state levels

What's next

  • No explicit next steps stated in the article

Read full article from source: The San Diego Voice & Viewpoint