Issue Brief · Enforcement, Tax & Special Populations

Tip Reporting, Payroll Tax & the New Tip and Overtime Deductions

Last reviewed June 13, 2026 15-minute read

The 2025 tax law put hotel payroll on the front line of the most publicized compensation change in a generation. "No tax on tips" and "no tax on overtime" are real — as deductions on the employee's return, administered through occupation codes and new W-2 boxes the employer must populate whether or not staff understand them. The 2025 transition-relief year is over; the 2026 W-2 is mandatory and machine-cross-matched. Meanwhile the old machinery — tip reporting, Form 8027, the §45B credit — keeps running and now reaches the hotel spa. None of it changes a dollar of FLSA pay; all of it can generate information-return penalties when miscoded.

At a glance#

Qualified-tips deduction (OBBBA §70201, new IRC §224): up to $25,000/year (2025–2028), reduced by $100 for each $1,000 of MAGI above $150,000 ($300,000 joint). Voluntary tips only — service charges and auto-gratuities never qualify.
Qualified-overtime deduction: up to $12,500 ($25,000 joint) — and only the FLSA-required half-time premium counts, so California daily OT and double-time do not.
Hotel roles qualify: the final list (TD 10044, effective June 12, 2026) names bellhops (TTOC 301), concierges (302), hotel/motel/resort desk clerks (303), and housekeepers (304), plus valet/parking attendants and spa massage therapists and skincare specialists at the category level.
2026 W-2s change: Box 12 code TP (qualified tips, which requires the occupation code), Box 12 code TT (qualified overtime), and Box 14b (the three-digit Treasury Tipped Occupation Code, up to two). 2025's Notice 2025-62 penalty relief has expired.
Deductions, not exclusions: withholding and FICA continue unchanged — paychecks don't grow; refunds do, only at filing. An income-tax item, not a wage rule.

The baseline machinery: tip reporting and Form 8027#

Employees must report cash and charge tips of $20 or more per month to the employer (IRC §6053(a)); the employer withholds income and FICA taxes on reported tips and pays the employer share of FICA. Modern POS systems make charge-tip reporting nearly automatic; the compliance gaps live in cash-heavy corners — bell stands, valet, room-service cash drops.

"Large food or beverage establishments" — more than 10 employees on a typical day, food or beverage served on premises, tipping customary — file Form 8027 annually per establishment (paper by the end of February, e-file by March 31), typically one per tipped outlet. If reported tips fall below 8% of gross receipts, the employer must allocate the difference among tipped employees (W-2 Box 8) — an audit flag better managed through reporting education than allocation. The voluntary SITCA program (Rev. Proc. 2023-15 lineage) offers audit protection for compliant POS-based reporting. The new regime raises the stakes on consistency: Form 8027, the 941s, the Box 7 social-security-tips figure, and now Box 12 TP all describe the same dollars, and IRS systems cross-match them — so a year-end reconciliation across all four, per outlet and per employee, is the cheapest audit defense in this subject area.

"No tax on tips": the §70201 mechanics, in order#

What the deduction is#

OBBBA §70201 added IRC §224: an above-the-line deduction (whether or not the employee itemizes) for qualified tips received in tax years 2025 through 2028 — voluntary cash and charged tips, by customers or through tip sharing, in an occupation that customarily and regularly received tips on or before December 31, 2024, per the final regulations. Three structural limits sit on top:

The cap: $25,000 of qualified tips per return per year.
The phaseout: the deduction is reduced by $100 for each $1,000 (rounded down to whole thousands) by which modified adjusted gross income exceeds $150,000 ($300,000 joint). The arithmetic runs on total MAGI — including a spouse's wages — not just tip income.
Filing mechanics: married taxpayers must file jointly to claim it, per IRS guidance.

Worked example — the phaseout arithmetic#

A banquet captain reports $16,200 in qualified tips. Household MAGI on the joint return is $312,500 — $12,500 over the $300,000 joint threshold.

Tentative deduction = lesser of tips or the cap = min($16,200, $25,000) = $16,200.
Excess MAGI = $12,500 → $12,500 ÷ $1,000 = 12.5, rounded down to 12.
Reduction = 12 × $100 = $1,200.
Allowed deduction = $16,200 − $1,200 = $15,000.

At the same tip figure, a joint MAGI of $462,000 or more zeroes the deduction entirely ($162,000 excess → $16,200 reduction). The phaseout runs on the deduction amount, so high earners lose it dollar-for-ten-dollars whatever the cap.

Who qualifies: the occupation list#

The final regulations (TD 10044, published April 13, 2026, effective June 12, 2026 — applicable to tax years beginning after December 31, 2024) list 70+ occupations, each with a three-digit Treasury Tipped Occupation Code. Four hotel-core codes in the Hospitality & Guest Services 300-series are verified by name; the other hotel-relevant roles are confirmed by category placement — pull their exact digits from the IRS TTOC table rather than guessing.

Hotel-relevant Treasury Tipped Occupation Codes (TD 10044 final regulations)
TTOC	Occupation	Hotel application
301	Baggage porters & bellhops	Bell stand, door staff handling luggage
302	Concierges	Concierge desk, club lounge
303	Hotel, motel & resort desk clerks	Front desk qualifies — the surprise inclusion
304	Maids & housekeeping cleaners	Room attendants, house attendants
100-series	Beverage & food service occupations	Servers, bartenders, room service, baristas
600-series	Personal appearance & wellness	Spa massage therapists, skincare specialists (estheticians)
800-series	Transportation & delivery	Valet and parking attendants

Map employees by what they actually do, not by job title — the test is the occupation's customary tipping history (customary on or before December 31, 2024, and voluntary), and an employee in two tipped occupations is tracked and W-2-coded under both. Verify each role against the IRS list, not the org chart.

What never qualifies#

Mandatory service charges and auto-gratuities — wages, not tips (see service charges). The site's tip-pool rules data encodes this as a flag (obbbaQualifiedTip: false on the service-charge record), so every tool carries the same answer. A banquet department paid through service-charge distributions gets no deduction from those dollars.
Tips from mandatory tip pools to managers or supervisors (illegal anyway — tip credit); tips paid in digital assets; tips where the recipient owns 5%+ of the business; amounts in years MAGI exceeds the phaseout.

It is not a withholding change: FICA applies in full, income-tax withholding tables are unchanged, and the benefit shows up at filing time. Say exactly that in employee communications, or February's "why is my check the same?" questions become turnover.

"No tax on overtime": the FLSA-premium trap#

The companion deduction covers qualified overtime compensation — capped at $12,500 ($25,000 joint), same years, same phaseout — defined as the premium required by FLSA §7: the extra half-time on hours over 40 in a workweek. What does not qualify is exactly what trips up multi-state hotels, and it forces a payroll-coding rule.

Worked example — California daily OT vs. the deduction#

A Los Angeles cook works four 10-hour days (40 hours) at $25/hr. California daily OT pays 8 hours at time-and-a-half — a $100 premium for the week. FLSA hours over 40: zero, so qualified overtime for the deduction is $0. The $100 is real California pay, but it is state-only and rides nowhere on the TT line.
The same cook at 5×9 = 45 hours: the FLSA OT premium is 5 × 0.5 × regular rate — only that half-time slice is deductible, not the full time-and-a-half and not any state-only premium.

Hotel trap The OBBBA overtime deduction reaches only the FLSA-required half-time premium. California daily OT, the seventh-day premium, double-time, and any CBA premium above the federal minimum do not qualify. Payroll must split code TT: report only the FLSA half-time portion and leave every state-only or contractual premium dollar out, even though all of it is paid and taxable. A blended "OT earnings" code cannot produce a correct TT figure. And because the half-time slice is computed on the federal regular rate, TT is only as right as the regular rate beneath it — see overtime & the regular rate.

2026 compliance timeline and payroll configuration#

The most important operational fact this year: the grace period is over. The 2025 transition ran under IRS Notice 2025-62, which gave §§6721/6722 penalty relief — no penalties for failing to separately report tips, occupation codes, or overtime for 2025, so long as the return was otherwise complete and accurate (tips and OT still inside total wages); employees reconstructed the 2025 figures from pay records (Notice 2025-69). That relief does not carry forward.

From transition relief to mandatory reporting
Period	Reporting posture	What the employer owes
Tax year 2025 (W-2 filed early 2026)	Notice 2025-62 penalty relief	No separate tip/OT/occupation reporting required; tips and OT included in total wages; employees reconstruct figures
TD 10044	Final occupation regulations — effective June 12, 2026; applicable to tax years beginning after Dec 31, 2024	The occupation list (codes 301–304 and the category-level valet/spa codes) is now final, not proposed
Tax year 2026 (W-2 filed early 2027)	Mandatory — relief expired	Box 12 TP (qualified tips), Box 12 TT (qualified OT), and Box 14b (TTOC, required whenever TP is used)

TD 10044's retroactive applicability stands behind both the 2025 employee claims and the §45B beauty-services expansion below — but the W-2 reporting obligation bites on 2026 wages and is no longer optional.

Payroll-system configuration checklist#

Resolve the timeline into who owns each setting and where the value comes from in the HRIS, so the W-2 extract is correct by construction:

Who sets the TTOC. The occupation code is HR/compensation data, not a payroll-clerk free-text field. Map every job code in the HRIS to a single TTOC (or "none"), owned by HR with payroll-tax sign-off, so Box 14b is derived from the job assignment automatically — never keyed per W-2. An employee with two tipped job codes must surface both, so up to two codes flow to 14b.
Where TP comes from. TP is the reported-tip figure already captured for §6053 and Box 7; segregate the tip earnings code from service-charge distribution codes at the POS so only voluntary tips reach TP. A wrong or missing 14b when TP is populated is itself a reporting defect.
Where TT comes from. Build a dedicated FLSA half-time premium earnings code the overtime engine writes only for hours over 40 in the federal workweek; route state-only daily OT, double-time, and above-FLSA CBA premiums to separate codes that never map to TT.
Vendor readiness. Get written confirmation the payroll provider's 2026 W-2 build supports TP, TT, and the 14a/14b split; run a test extract before the first 2026 pay run.
Reconciliation owner. Assign the year-end cross-match (Form 8027, 941s, Box 7, Box 12 TP) to a named owner, per outlet and employee.

Worked example — one employee's 2026 W-2#

A front desk agent (TTOC 303) at a Texas property also picks up two bartending shifts a week (a 100-series F&B code). Over 2026 she has $41,600 in wages, $6,300 in reported voluntary tips (desk plus bar), $1,150 in banquet service-charge distributions, and $890 of FLSA overtime premium (half-time portion only).

Box 1: everything — $49,940. The deductions live on her return, not in withholding.
Box 12, TP: $6,300 — reported tips only. The $1,150 of service-charge distributions is excluded: those are wages, never "tips," already in Box 1 as ordinary pay.
Box 12, TT: $890 — only because payroll isolated the FLSA half-time premium in its own code all year.
Box 14b: 303 plus the applicable F&B code — both, because she earned tips in two listed occupations.

At filing she deducts the $6,300 (well under the cap, assuming MAGI under the threshold) and the $890 — roughly a $7,190 reduction in taxable income, on her return. Nothing about her weekly paycheck changed.

The §45B FICA tip credit — now including the spa#

Food-and-beverage employers have long claimed a general business credit (Form 8846) for the employer-share FICA paid on tips above those used to satisfy a frozen $5.15 benchmark. OBBBA extended §45B to "specified beauty services" — barbering and hair care, nail care, esthetics, and body and spa treatments — effective for taxable years beginning after December 31, 2024, with the beauty-services base computed against the $7.25 federal minimum rather than the frozen $5.15. For hotel spas with W-2 therapists and estheticians, this is found money: where staff already earn cash wages at or above the benchmark, essentially every reported tip dollar generates a credit equal to the employer's 7.65% FICA share.

Worked example — a spa therapist's §45B credit#

The two benchmarks shrink the credit base differently. A hotel spa massage therapist and an F&B server each report $30,000 in tips and each earn cash wages well above the federal minimum, so no tips are needed to reach the benchmark. Walk both:

F&B server ($5.15 base). The server's cash wage already exceeds $5.15/hr, so no tips are absorbed reaching the frozen benchmark and the full $30,000 feeds the credit: $30,000 × 7.65% ≈ $2,295.
Spa therapist (beauty-services expansion, $7.25 base). The newly covered base excludes tips used to satisfy the higher $7.25 minimum; where the therapist's cash wage already meets $7.25/hr, again no tips are absorbed, so the full $30,000 feeds the credit: $2,295.

The higher $7.25 base only bites when cash wages sit between $5.15 and $7.25 and tips are doing the work of reaching the floor — then the spa base is reduced by the tips absorbed up to $7.25, where the F&B base reduces only up to $5.15. Above the floor the two converge. Scale it: a spa booking $80,000 in reported therapist tips at cash wages above $7.25 throws off roughly $80,000 × 7.65% ≈ $6,120 on Form 8846 — retroactive to the 2025 taxable year for this newly covered service line.

Two notes. The employee-side §224 deduction does not shrink the §45B credit: it is income-tax only, tips remain FICA wages in full, so the employer FICA feeding the credit is unchanged — the two benefits stack, one per side. And ordinary general-business-credit discipline applies: the employer cannot also deduct the FICA taken as a credit, and the credit exists only for reported tips — making tip-reporting education triply valuable (Form 8027 ratio, §45B base, employee TP figure). Code spa tips separately from F&B (different benchmark) and from service charges (no credit at all).

Decision framework: converting a service charge to a voluntary tip#

The tax provisions sharpen a structural choice the hotel already faced on the wage side. A mandatory banquet service charge buys revenue certainty and house control; the same dollars routed as voluntary gratuities unlock three tax benefits the service charge forecloses. This is the tax mirror of the architecture decision in service charges — resolve the two jointly, because one POS configuration drives both the ownership analysis there and the reporting analysis here.

Service charge vs. voluntary tip — the tax-side ledger
Dimension	Mandatory service charge	Voluntary gratuity line
Employee §224 deduction	None — never a qualified tip	Qualifies (up to the $25,000 cap, subject to the MAGI phaseout)
W-2 Box 12 TP / Box 14b	Excluded — booked as ordinary wages in Box 1	Reported in TP with the occupation code in 14b
Employer §45B FICA-credit base	Ineligible — service-charge wages generate no credit	Reported tips feed the credit (F&B and now spa/beauty)
FICA timing & treatment	FICA when paid as wages; in the regular rate for overtime	FICA on reported tips; excluded from the regular rate
Revenue certainty	High — a fixed percentage the house controls and distributes	Lower — the guest sets the amount; banquet revenue becomes variable

The trade. Conversion moves money from a certain, house-controlled line to a guest-discretionary one, buying an employee income-tax deduction staff can feel, a §45B credit base, and clean Box 12 TP reporting — while surrendering the predictability banquet sales relies on, and changing nothing about what the employee is paid. The decision cannot be made on the tax ledger alone: conversion also flips regular-rate inclusion, tip-credit eligibility, and tip-pool constraints, and at covered California properties collides with local pass-through mandates that route the money regardless of label. Those consequences are priced in the architecture scoring table in service charges; resolve the structure there first, then map the POS lines to the W-2 treatment here. A hybrid — a disclosed administrative fee plus a clearly voluntary gratuity line — is usually the cleanest posture: only the gratuity line carries the deduction, the §45B base, and the TP reporting.

Exposure anatomy: information-return penalties and the wage-law interaction#

Unlike the wage-and-hour briefs, the exposure here is not a back-wage multiplier — no employee is underpaid by a coding error. It is twofold: information-return penalties for incorrect W-2s, and a cascade of lost benefits (the employee's denied deduction, the employer's forfeited §45B credit) surfacing as employee-relations and audit cost, not litigation.

The information-reporting penalty structure#

IRC §6721 penalizes failures to file correct information returns; §6722 penalizes failures to furnish correct payee statements (the employee's copy). The structure — stated at generality, without invented dollar tiers — is a per-form penalty that scales with how late the correction is and with the volume of forms, plus a separate, larger penalty for intentional disregard. With Notice 2025-62 relief expired, a wrong or missing Box 14b when TP is reported, or a TT figure that sweeps in non-FLSA premiums, is a correctable defect that can draw the penalty on each affected form — and a hotel with hundreds of tipped W-2s carries that across the whole population, not one return. Because the penalty is per-form and volume-driven, the configuration discipline above keeps a single mapping error from multiplying across the workforce.

The wage-and-hour interaction trap (the split-TT rule)#

The trap that converts a multi-state payroll into recurring penalty exposure is the overtime-premium definition. Because the OBBBA overtime deduction covers only the FLSA-required half-time premium, every California daily-OT dollar, seventh-day premium, double-time dollar, and above-FLSA CBA premium must be excluded from Box 12 TT — even though all of it is paid and taxed. Reduced to a payroll-coding rule:

Compute the federal regular rate correctly, isolate the half-time-over-40 slice in a dedicated earnings code; that code alone maps to TT.
State-only and contractual premium codes never map to TT, whatever the timecard labels the hours.
A single blended "overtime" amount cannot produce a correct TT — and overstating TT by sweeping in California daily OT is exactly the incorrect payee statement §6722 reaches.

This is why the deduction is an employee income-tax item, not a wage rule: it changes nothing about what FLSA, California, or a CBA requires the hotel to pay; it governs only which already-paid premium dollars are reported as deductible.

How this connects across the site#

This brief is the canonical home for the federal tax and information-reporting layer; four other briefs feed it or are fed by it, and each link is a transmission, not an adjacency.

Service charges — the mirror. A mandatory charge is a wage, so it is never Box 12 TP and is §45B-ineligible — the exact inverse of a voluntary tip. Coding a service charge as a tip to chase the deduction imports an information-reporting error on top of the wage error.
Tip credit — declared tips drive both. The same declared-tip figure that supports the §3(m) tip credit populates Box 12 TP and the §45B base. Under-declaration breaks all three — deflating the credit, shrinking the §45B base, denying the employee the §224 deduction — so accurate declaration is now in the employee's own interest, improving the Form 8027 ratio as a side effect.
Recordkeeping — the tip records feed the codes. The §516.28 tip-record obligations are the source data here: without per-employee, per-outlet tip records there is no defensible Box 12 TP figure and no §45B substantiation.
Overtime & the regular rate — which dollars are "FLSA-required." The TT figure is the federal half-time premium and nothing else, computed on the federal regular rate. Get the rate wrong, or mistake a state-only premium for an FLSA one, and TT is wrong. The definition of "FLSA-required" lives there; this brief consumes it.

State taxes still apply (mostly)#

The deductions are federal. State income-tax treatment turns on each state's conformity rules, and several populous states do not conform — tips remain fully taxable on the state return even when deductible federally. A Texas housekeeper (no state income tax) gets the full benefit; a California server may take the federal deduction and still owe state tax on every tip dollar. Avoid promising "tax-free tips"; the accurate phrase is "a federal income-tax deduction, within limits." Conformity is a moving target — track it on the compliance calendar rather than assuming this year's answer holds.

Compliance checklist#

Form 8027 filed per qualifying outlet; allocated-tip exposure managed through reporting education; SITCA evaluated.
§45B credit claimed on Form 8846 — now including spa/salon tips (taxable years after 12/31/2024); spa tips coded separately from F&B; benchmark applied correctly ($7.25 for beauty/spa, $5.15 for F&B).
Every job code in the HRIS mapped to a TTOC or marked ineligible by HR, with payroll-tax sign-off; Box 14b derived from the job code, never keyed per W-2; dual-role employees surface both codes.
POS separates voluntary tips from service charges end-to-end; banquet auto-grats never coded as tips or into Box 12 TP.
FLSA-required half-time premium isolated in its own earnings code feeding Box 12 TT; state-only premiums (CA daily OT, double-time) and CBA premiums above FLSA excluded — code TT split accordingly.
2026 W-2 template tested (TP, TT, 14a/14b) against the redesigned form; payroll-provider readiness confirmed in writing; 2025 Notice 2025-62 relief treated as expired.
Year-end reconciliation (Form 8027, 941s, Box 7, Box 12 TP) assigned to a named owner, per outlet and per employee.
Service-charge-to-voluntary-tip conversion modeled jointly with the service-charges architecture decision before any banquet check changes.
Employee communication issued: deduction-not-exclusion, the caps, the $100-per-$1,000 phaseouts, joint-filing requirement, and state nonconformity.

Key authorities#

IRC §6053; Form 8027 instructions; IRC §45B (as amended by OBBBA); Form 8846.
One Big Beautiful Bill Act (Pub. L. 119-21, July 4, 2025) — §70201 (qualified tips, IRC §224) and the qualified-overtime deduction, 2025–2028.
TD 10044 (Apr. 13, 2026) — final tipped-occupation regulations and TTOC list; effective June 12, 2026; applicable to tax years beginning after Dec. 31, 2024.
IRS, "What the 'No Tax on Tips' deduction means for you" (phaseout and joint-filing mechanics); 2026 Form W-2 and General Instructions for Forms W-2 and W-3 (codes TP/TT; Box 14a/14b).
IRS Notice 2025-62 (2025 transition penalty relief under §§6721/6722); IRS Notice 2025-69 (individual guidance).
IRC §§6721, 6722 (information-return and payee-statement penalties — per-form, volume- and lateness-scaled, with an intentional-disregard tier).
29 CFR 531.55 (service charges are wages); 29 CFR 516.28 (tip records); IRS Rev. Rul. 2012-18.

Case law on point

Grant v. Global Aircraft Dispatch, Inc., 223 A.D.3d 712 (2d Dep't 2024)

Held there is no private right of action for a frequency-of-pay violation under Labor Law section 191 — directly contrary to <em>Vega</em>.

Why hotels care: The defense-side counterweight to <em>Vega</em>. Until the New York Court of Appeals resolves the split, a hotel's weekly-pay exposure for housekeepers turns on which Department hears the case.
Mothering Justice v. Attorney General, Mich. July 31, 2024

The legislature's 2018 "adopt-and-amend" maneuver was unconstitutional, reviving the original minimum-wage initiative including its tip-credit phase-out — before February 2025 legislation enacted a compromise preserving a 50% tipped wage by 2031.

Why hotels care: Michigan hotels lived through a near-elimination of the tip credit; the surviving compromise schedule (40% in 2026, 50% by 2031) is now a fixed planning input.
Naranjo v. Spectrum Security Services, Inc. (I & II), 13 Cal.5th 93 (2022); 15 Cal.5th 1056 (2024)

Break premiums are "wages" that trigger wage-statement and waiting-time penalty exposure (Naranjo I); but an employer's objectively reasonable, good-faith belief that it complied defeats the "knowing and intentional" and "willful" elements of those penalties (Naranjo II).

Why hotels care: Defines the derivative-penalty stack on every California break case — and the documented-good-faith off-ramp. Written compliance analyses now have direct penalty-defense value.
Restaurant Law Center v. U.S. Department of Labor, 115 F.4th 396 (5th Cir. 2024)

Vacated the DOL's 2021 "80/20/30" dual-jobs rule nationwide as contrary to the FLSA's text and arbitrary and capricious — ending the federal requirement to track tipped employees' side work in 20-percent and 30-minute increments.

Why hotels care: Federal side-work minute-counting is gone, but the underlying dual-jobs doctrine survives, plaintiffs still plead legacy 80/20 theories, and New York's own 80/20/two-hour rule is unaffected.
Hartstein v. Hyatt Corp., 82 F.4th 825 (9th Cir. 2023)

Held that a hotel's COVID-era furlough of employees with no specific return date was a "termination" that triggered California's prompt-payment rule under Labor Code section 201: the vested vacation that section 227.3 makes payable had to be paid right away, not whenever the layoff later hardened into a formal severance.

Why hotels care: A hotel case on point: indefinite furloughs and seasonal layoffs can trigger immediate accrued-vacation payout and final-pay timing in California — budget the PTO liability before pausing a property.
Helix Energy Solutions Group, Inc. v. Hewitt, 598 U.S. 39 (2023)

A highly paid employee compensated on a daily-rate basis is not paid on a "salary basis" and therefore is not exempt — regardless of how large the total income is.

Why hotels care: Day-rate or shift-rate pay for banquet managers, task-force leaders, or chief engineers destroys the exemption even at six-figure earnings; guarantee a true weekly salary or pay overtime.

Full case digest →

Litigation & rulemaking watch

June 13, 2026
Site update: audit engines deepened — 16 penalty regimes, 15 premium jurisdictions, per-day tip credit, service-charge downstream math A category-leap upgrade to the four audit engines. The exposure modeler now spans 16 regimes sorted by damages architecture — adding Arizona, Connecticut, Florida, Maryland, Oregon, Pennsylvania, and a second Illinois record for the Minimum Wage Law — with Massachusetts prejudgment interest on the un-trebled base (George), New York's spread-of-hours and pay-frequency gate, Colorado's demand-tender toggles, and an optional user-supplied attorneys'-fee line. The tip-pool architect makes the New York and Connecticut daily dual-jobs rules computable, adds the Connecticut attestation and Colorado patron-notice gates, card-portion-only fee math, New Hampshire and Montana overlays, and a service-charge classifier that prices the downstream regular-rate uplift, overtime, FICA/§45B, and OBBBA exclusion. The housekeeper auditor promotes the LA County, Glendale, and Long Beach ordinances to computed rules and adds Washington's Demetrio piece-rate decomposition. The workweek auditor adds Illinois and Kentucky premium rules (13 → 15) and resolves the tip-credit ceiling exactly per day when the floor steps mid-week.
June 12, 2026
Site update: premium-pay engine expanded to 13 jurisdictions; penalties to 9; per-day wage floors The workweek auditor now computes verified premium rules for CA, NY, CO, NV, AK, WA, OR, MA, NJ, CT, NH, RI, and D.C. — including Colorado and Washington break-time pay, the reporting-pay guarantees in six states, D.C. split-shift pay, and Nevada rolling-24-hour and Colorado 12-consecutive-hour overtime computed from shift segments. The exposure modeler adds WA, NJ, IL, CO, and D.C. penalty regimes and all four post-reform PAGA tiers; the tip-pool architect adds seven state overlays including Minnesota's mandatory-pool prohibition; wage floors now resolve per day, so a mid-week rate step computes both regimes. A new methodology page documents sourcing and every disclosed gap.
June 12, 2026
Seven new audit and planning tools launch on this site The tools library grows from three calculators to ten interactive tools: a stacked Workweek Compliance Auditor (federal + state + city + hotel-ordinance layers in one pass), a Housekeeper Workload & Piece-Rate Auditor covering the square-footage ordinances, a Tip Pool & Service Charge Architect with per-person legality verdicts, a Portfolio Rate Forecaster with scheduled steps through 2030 and beyond, a Wage-Hour Exposure & Penalty Modeler, a Fair Workweek Premium Calculator for the five laws that reach hotels, and a Hotel Compliance Profiler.
June 12, 2026
IRS tipped-occupation final regulations take effect TD 10044 (published April 13, 2026) is effective today: the final Treasury Tipped Occupation Code list confirms that bellhops (TTOC 301), concierges (302), hotel desk clerks (303), and housekeepers (304) — plus valet and spa roles — qualify for the OBBBA tips deduction. Mandatory service charges and auto-gratuities do not qualify.

All developments →