Employers and taxpayers will be provided penalty relief regarding new information reporting requirements for cash tips and qualified overtime compensation under the One Big Beautiful Bill Act (OBBB), according to a Nov. 5 announcement by the IRS.
The OBBB was signed into law by President Donald Trump on July 4 and includes provisions related to taxes. The IRS had earlier issued relief statements for numerous reporting requirements as part of giving taxpayers time to adjust to the new changes brought about by the act.
According to the OBBB, there are no taxes on tips and overtime compensation. Certain employees and self-employed individuals may deduct qualified tips from Forms W-2, 1099, and 4137. The same applies to qualified overtime compensation….