GREEN BAY, Wis. (WFRV) Tens of thousands of people work in the service industry in Wisconsin and many of them are given cash tips. Now an area lawmaker is proposing a bill to make those cash tips – tax free.
Azshurdee Yoho is a server at Stadium View Bar and Grill – where she does all she can to keep her customers happy. It’s hard work and often she’s rewarded with cash tips.
“I’d say on a busy night, I’d say at least two hundred,” said Yoho.
Now Republican State Senator Andre Jacque is working on a bill to make sure Yoho gets to keep every penny of that cash.
“This bill I think, is just common sense in terms of not taking money away from people who need it,” said Jacque.
Under this bill, authored by Jacque and a Republican representative from Mukwonago, cash tips received by an employee in various service industries like tourism, restaurants and taverns, would be exempt from state income tax. The money would still need to be reported on federal tax returns.
“It’s extra money in their pocket, extra money they are able to use to support themselves and their families and the local economy,” Jacque said.
“Having their cash tips be tax free would definitely be a benefit for them,” said Amanda Watson who owns Stadium View Bar and Grill.
Watson says tax free tips would also give her a hiring incentive when it comes to recruiting employees.
“That could definitely help bring staff in and get them interested in the job,” she said.
“It’s saying in Wisconsin we are not going to penalize individuals looking to work hard and provide extraordinary service,” Jaque said.
If passed, Wisconsin would be the first state in the country with a state tax exemption for cash tips paid to service workers. Jacque says his bill has bipartisan support. He’s hoping a vote on it could take place in the coming months.