US President Donald Trump took to Truth Social on Tuesday (February 17) to highlight what he described as unprecedented tax refunds for Americans this year, crediting his administration’s legislative achievements.
“Tax Refunds this year, because of ‘THE GREAT BIG BEAUTIFUL BILL,’ are substantially greater than ever before. In some cases, estimates are that over 20% will be returned to the Taxpayer,” Trump wrote.
He encouraged Americans to recognize the benefits of the legislation: “So, when you get your Tax Refund, think about what a wonderful President you have — NO TAX ON TIPS, NO TAX ON SOCIAL SECURITY FOR OUR GREAT SENIORS, NO TAX ON OVERTIME, INTEREST DEDUCTIONS ON CAR LOANS, AND MUCH MORE. Don’t spend all of this money in one place!”
White House highlights largest tax cuts in US history
The White House echoed Trump’s message on
The measures are seen as a direct benefit to taxpayers, particularly seniors and workers, citing reductions in taxes on tips, overtime pay, and Social Security income.
Key takeaways
The “One Big Beautiful Bill” is credited with delivering record tax refunds for Americans in 2026.
Tax relief measures include:
-No tax on Social Security for seniors
-Interest deductions on car loans
“One, Big, Beautiful Bill” delivers major tax relief for tips and overtime
The recently passed One, Big, Beautiful Bill is set to provide substantial federal tax relief to millions of Americans, particularly workers in service industries, veterans, and lower-wage earners. The legislation impacts federal taxes, credits, and deductions, allowing taxpayers to take advantage of new provisions this filing season.
No tax on tips
Employees and self-employed individuals in tip-receiving occupations—such as wait staff, bartenders, salon workers, personal trainers, and gig economy workers—may qualify for a deduction on tips earned in 2025.
Qualified tips include voluntary cash or charged tips received directly from customers or through tip sharing.
Deductions apply to tips reported on Form W-2, 1099-NEC, 1099-MISC, 1099-K, or Form 4137.
Maximum annual deduction: $25,000; for self-employed individuals, deduction cannot exceed net income from the trade or business where tips were earned.
Deduction phases out for modified adjusted gross income above $150,000 ($300,000 for joint filers).
Taxpayers are encouraged to review official IRS guidance to understand how the “no tax on tips” deduction is calculated.
No tax on overtime
The bill also allows individuals to deduct qualified overtime pay that exceeds their regular rate of pay, generally the “half” portion of “time-and-a-half” compensation required by the Fair Labor Standards Act.
Deduction applies to overtime reported on Form W-2, 1099, or other specified statements.
Maximum annual deduction: $12,500 ($25,000 for joint filers).
Deduction phases out for modified adjusted gross income above $150,000 ($300,000 for joint filers).
Available to both itemizing and non-itemizing taxpayers.
Who benefits?
This legislation primarily supports:
Workers in service industries who rely on tips as part of their income.
Individuals earning overtime pay in regulated industries.
Veterans and lower-wage workers seeking relief on federal taxes.
The new deductions ensure that eligible taxpayers can retain more of their hard-earned income, offering financial relief at a time when many rely on extra earnings from tips and overtime to meet daily expenses.
