Tax Tip Calculator
Determine your take home from tips after taxes
How Your Paycheck Works
What’s a tax tip calculator?
A tax tip calculator helps you determine your take-home pay from tips + earnings after taxes. By entering your tip income, filing details, and optional deductions, the calculator estimates the taxes deducted (federal, state, and local) and provides your net take-home pay. It’s a useful tool for understanding how taxes impact your tip earnings and for better financial planning.
Are tips taxable income?
Yes, all tips are considered taxable income and must be reported to the IRS. This includes cash tips, tips from customers using credit cards, and tips shared with other employees.
What is gross pay?
Gross pay amount is earnings before taxes and deductions are withheld by the employer. The gross pay in the hourly calculator is calculated by multiplying the hours times the rate. You can add multiple rates. This calculator will take a gross pay and calculate the net pay, which is the employee’s take-home pay.
Gross pay - Taxes - Benefits/other deductions = Net pay (your take-home pay)
Gross pay - Taxes - Benefits/other deductions = Net pay (your take-home pay)
What is pay frequency?
Pay frequency refers to the frequency with which employers pay their employees. The pay frequency starts the entire payroll process and determines when you need to run payroll and withhold taxes.
Do I need to report cash tips for taxes?
Yes, you are required to report all tips, including cash, to your employer if they total $20 or more in a month.
Are service charges or automatic gratuities considered tips?
No, service charges are not considered tips. They are treated as regular wages and taxed accordingly.
How does the Tax Tip Calculator determine my take-home pay?
The Tax Tip Calculator determines your take-home pay by taking the tip amount you enter and calculating the applicable taxes based on the information you provide. This includes your filing status, hourly rates, dependents, additional income, and any deductions. The calculator accounts for federal taxes by default and state/local taxes if a state is selected. It subtracts these taxes from your total tips to give you the net take-home amount.
Can I include tips from multiple sources?
Yes, you can include tips from multiple sources. Simply combine the total amount of tips you received and enter the combined value in the “Tip Amount” field under the Earnings section of the calculator. The tool will calculate the taxes and take-home amount based on the total entered.
What are my withholding requirements?
Employers and employees are subject to income tax withholding. There are federal and state withholding requirements. Find federal and state withholding requirements in our Payroll Resources.
How do I know if I’m exempt from federal taxes?
You are tax-exempt when you do not meet the requirements for paying tax. This usually happens because your income is lower than the tax threshold (also known as the standard deduction). For 2024, you need to make less than:
- single filer or married filing separately: $14,600
- married joint filers: $29,200
- head of household: $21,900
If you are 65 or older, or if you are blind, different income thresholds may apply. Check the IRS Publication 505 for current laws.
Claiming exempt from federal tax withholding on your W4 when you aren’t eligible isn’t illegal but it can have major consequences. You might receive a large tax bill and possible penalties after you file your tax return.
State Tax Tip Calculators
Select your state from the list below to see its tax tip calculator.
- Alabama
- Alaska
- Arizona
- Arkansas
- California
- Colorado
- Connecticut
- Delaware
- Florida
- Georgia
- Hawaii
- Idaho
- Illinois
- Indiana
- Iowa
- Kansas
- Kentucky
- Louisiana
- Maine
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Mississippi
- Missouri
- Montana
- Nebraska
- Nevada
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Pennsylvania
- Rhode Island
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Virginia
- Washington
- Washington DC
- West Virginia
- Wisconsin
- Wyoming
- American Samoa
- Guam
- Northern Mariana Islands
- Puerto Rico
- US Virgin Islands
The calculators on this website are provided by Symmetry Software and are designed to provide general guidance and estimates. These calculators should not be relied upon for accuracy, such as to calculate exact taxes, payroll or other financial data. Neither these calculators nor the providers and affiliates thereof are providing tax or legal advice. You should refer to a professional adviser or accountant regarding any specific requirements or concerns.