A TikTok video with nearly 1 million views is going viral for calling out what one server is calling a dangerous illusion: The “no tax on tips” bill. Posted by creator Kristian Renae (@creature_feature_show), the video argues that the bipartisan measure to eliminate federal income tax on cash tips isn’t the worker-friendly policy it appears to be. Instead, it could pressure service workers to report more of their income, exposing them to audits and justifying lower hourly wages.
Kristian Renae’s video, shared on May 21, 2025, dropped as the U.S. Senate voted unanimously to pass the “bill that would eliminate federal income tax on cash tips.” The TikToker asserted that the policy is meant to fool service industry workers into reporting wages so that the government can justify future legislation to keep hourly wages low. Experts agree, arguing “no tax on tips” could ultimately deepen inequities.
Why “no tax on tips” could end up costing service workers more
TikTok users echoed their concerns in the 3000+ comments section of the video. Many shared additional reasons for servers to think twice before reporting cash tips. With increased income on the books, taxable or not, servers could be disqualified from receiving aid or made vulnerable to audits. People asked: Why else would the government want tips that aren’t going to be taxed to be reported?
“If there’s no tax on tips, then why would they still need to be reported? 100% sus all around,” agreed @dirty_raptor.
The unintended consequences of reporting untaxed cash
Kristian Renae warned TikTok, “I don’t think you guys understand that ‘no tax on tips’ is a trap.”
They explained that servers are already legally obligated to claim 100% of their tips, including cash. But cash is not tracked to enforce taxation, so it’s well known that servers supplement their meager hourly wages by keeping cash off the books. The unofficially tax-free earnings help people with low incomes get by.
Government officials present “no tax on tips” as a benefit to service industry professionals, but Kristian Renae says they’re putting the policy into effect in order to cut government spending.
“Now all of a sudden, the servers are making a tiny bit more money… in their tips every week to get a little deduction at the end of the year. And the government’s going to say, oh, see, we knew you were lying…you make plenty of money on your tips.”
If the government can prove servers make “plenty” of money on tips, they can decide, “You don’t need a dollar an hour, you don’t need four dollars an hour as your base pay.”
@creature_feature_show It’s a trap. #notaxontips #servers #serverlife #tipsforservers ♬ original sound – Creature Feature Show
“My cash tips are between me and god,” commented @howry333. Hmm, as they should be.
The real agenda of “no tax on tips”
“It’s a trap to disqualify them from aid,” commented @ta_for_funsies.
“Not to mention, oh look at all that money! You don’t need snap, wic, housing assistance etc,” said @jtourvil2.
“Plus now you make too much for food stamps/medicaid.etc,” said @itsberlyn.
“All these servers are going to claim huge amounts of tips this year and the IRS is going to go back and audit previous years thinking they were lying,” commented @random.paige.
“And if you have a student loan, they’re going to make you pay more monthly because your income went up,” added @jeanie5309.
Experts agree: No tax on tips is not what it seems
“As a tax accountant you are correct ma’am,” said @jeanninevibing.
“As a HR specialist, she is absolutely correct! I have been telling everyone that no tax on tips is a big fraud and yet no one listen,” commented @toriasdiary.
PSA: Tip cash if you can
A quick reminder for the direct deposit crowd: “I hate charge tips, please bring me cash,” commented @honeybunbaby9.
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