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TC.166
Under the baseline tax system, employer contributions to Social Security represent labor cost and are deductible expenses. Under current law, however, certain employers are allowed a tax credit, instead of a deduction, against taxes paid on tips received from customers in connection with the providing, delivering, or serving of food or beverages for consumption. The tip credit equals the full amount of the employer’s share of FICA taxes paid on the portion of tips, when added to the employee’s non-tip wages, in excess of $5.15 per hour. The credit is available only with respect to FICA taxes paid on tips.
This chart shows obligations for the program by fiscal year. All data for this chart was provided by the
administering agency and sourced from SAM.gov, USASpending.gov, and Treasury.gov.
For more information on each of these data sources, please see the
About the data page.
OMB is working with the U.S. Government Accountability Office (GAO) and agency offices of inspectors general to include links to relevant oversight reports. This section will be updated once this information is made available.
