Hello, this is reporter Ahn Byeong-cheon. On June 10th, former President Trump delivered a speech in Las Vegas, the city with the highest tip income, stating that if he were elected president, he would abolish federal taxes on tips. This has become a hot topic as the revised tax laws enacted in 2017 are set to expire at the end of 2025, making tax policies a crucial issue in this election. Is it realistically possible to exempt tip income from taxes as President Trump mentioned, or is it just a part of a simple election campaign strategy? Let's think about this together. Tips are generated not only in restaurants but also in various service industries. In the case of restaurants, tips received from customers are reported to the employers, who then deduct withholding taxes and report them to the tax authorities. However, this has recently become challenging due to the increasing use of credit cards.

As the use of servers has increased, it has become much easier for employers to calculate tips from customer card payments, even without servers reporting to the employers. However, tax laws still require employers to report cash tips through employees. Simply put, in the case of restaurant servers, there are two types of income: one is the wages received from the employer, and the other is the tips received from customers. These tips should be considered as income similar to wages. However, former President Trump stated that he would not subject federal income tax to these tip incomes in Las Vegas, where tip incomes are prevalent. As you may know, the term deflation has recently emerged. After the pandemic, there has been a significant change in the traditional tip culture in the United States, which was highly controversial last year. For instance, coffee shops that provide takeout service...

Of course, it is common to encounter screens requesting tips in various businesses that present terminals for credit card payments, often with a minimum 15% setup. Even so, the issue of tipping has been a subject of debate beyond the pandemic, questioning whom to tip and how much is appropriate. Former President Trump reignited this issue by suggesting exempting federal taxes on such tip income, raising the possibility of sparking controversy once again. Will Trump's proposal to exempt tip income from federal taxes be realized? First, if Trump succeeds in his endeavors, the exemption of tip income from federal taxes will expire by the end of 2025, leading to its abolition. By 2026, he would need to return to pre-2017 conditions or introduce new legislative amendments.

Next year, under the tax law regulations, a fierce battle is expected not only at the commercial field but also at the White House. Trump hopes that the bill he signed in 2017 will be established as a research bill. It is anticipated that there will be significant variables that have been revised and maintained as they were. Unlike the situation in 2017, in order to resolve the astronomical debt of the U.S. government due to the pandemic, taxes must be raised and various tax benefits reduced to increase tax revenue. However, for ordinary people and the middle class who are already struggling with high inflation and high interest rates, eliminating tax cuts and various tax benefits can exacerbate economic difficulties. It cannot be ruled out that changes in tax laws, such as federal tax exemption for tip income mentioned by Trump, could be tied together for processing. Nevertheless, tip income is a kind of labor income.

There is a growing expectation that exempting this without a special reason is far from the basic principle of taxation and it is expected to be difficult to realize. In particular, Americans are increasingly feeling fatigue about tips. According to a recent bank survey, 59% of people have a negative view of tips. According to the survey, more than one-third of people say that the tipping culture is going too far, and 37% of employers say that rather than relying too much on tips, they should pay more wages. In addition, a recent Yelp report shows how sensitive and tired people are becoming as mentions of tips in restaurant reviews increase. The argument that low-income groups, who are the main source of TV income, should reduce taxes for younger generations is convincing, but there is an expectation of significant conflict over the complete federal tax exemption for tip income. Trump's

There will be a hot topic of debate in the future about whether the limit is a sophisticated election strategy or a tip income federal tax exemption through the limit of rational policies. Today, we thought together about the proposal to exempt federal taxes if re-elected in Trump's pre-election speech in Las Vegas. That's all for today. Thank you. If you are self-employed or work as a freelancer, it's not easy to manage the money coming in and going out. If you don't organize it, you may not properly understand how much you earn, and this can create holes in your money management, which could be detrimental to you. But did you know that we at BC 5 have created a platform for self-employed individuals and freelancers like you? You can see the money you earn at a glance, easily check the money you spend by category in real-time, and download real-time income and expense reports to hand them over to your accountant for tax filing.

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