The new “no tax on tips” provision for U.S. workers doesn’t apply to mandatory tips, such as those some restaurants require of large parties, the Internal Revenue Service has clarified.

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“Qualified tips must be paid voluntarily by the customer and not be subject to negotiation,” said a statement released by the agency on Sept. 28. If a customer has no option to disregard or modify the charge, it cannot be deducted from the employee’s income.

It’s common for restaurants to impose a gratuity — generally 18% of the bill — for parties of six people or more. And the threshold is sometimes much lower: One Cupertino restaurant came under fire in 2023 after a diner posted a receipt showing a mandatory 18% tip for “parties of 1 or larger.”

The federal law signed in July allows w

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