The Tipped Occupation List Changed After Filing Season. Should You Amend?

Most tax rules are settled before the filing season that uses them. The tipped occupation list was not. Treasury proposed a list in September 2025, took more than 300 comments and held a public hearing, and did not publish the final regulations until April 2026 — after a great many 2025 returns had already been filed.

The final list is not identical to the proposed one. If you filed early on the proposed version, it is worth a look.

What changed between proposed and final

The final regulations list more than 70 occupations, each with a three-digit Treasury Tipped Occupation Code, grouped into eight categories. Compared with the proposed rule, the final version clarified the scope of several categories and added occupations that were not previously there — the IRS specifically names visual artists and floral designers under personal services, and gas pump attendants under transportation and delivery.

The regulations apply for taxable years beginning after December 31, 2024. That is tax year 2025 — the return most people filed before the final list existed.

The IRS says you may amend

The IRS published a page for exactly this situation. Its language: "If you have already filed your 2025 Form 1040, 1040-SR, or 1040-NR and want to claim or change your 'no tax on tips' deduction, you may amend your return."

The vehicle is Form 1040-X.

Note the phrasing covers both directions. "Claim" is for someone whose occupation was added and who left the deduction off. "Change" is for someone who took a position that the final regulations did not adopt.

Who should actually look

You are a candidate for a second look if any of these describe your 2025:

• You are a visual artist, floral designer or gas pump attendant who received tips and concluded you were not on the list.
• You filed before the final regulations were published and relied on the proposed list for a borderline occupation. The proposed rule was reliable for taxpayers who followed it in its entirety and consistently — but the final list is what governs going forward.
• You had no separate tips figure to work from. The 2025 Form W-2 was never updated for the new reporting, so there was no Box 12 code TP and no occupation code. A lot of people simply skipped Part II rather than reconstruct a number.
• You are a non-employee whose 2025 Form 1099 showed no tips breakout, for the same reason.

How you were supposed to find the number for 2025

Notice 2025-69 set out the substitution methods, and they are more generous than most people realised at the time.

An employee could use the total social security tips reported in Box 7 of the 2025 Form W-2, plus any unreported tips shown on Form 4137. The notice's own example: a server whose Box 7 shows $18,000 of social security tips and who filed no Form 4137 "may use $18,000 in determining the amount of qualified tips for tax year 2025."

A second example covers a higher earner: a bartender who reported $20,000 of tips to the employer on Forms 4070, whose Box 1 exceeds the social security wage base so Box 7 shows only $15,000, and who reported $4,000 more on Form 4137. That bartender may use either the $15,000 from Box 7 or the $20,000 reported on the Forms 4070 — and add the $4,000 from Form 4137 either way.

If your Box 7 was capped by the wage base, the Box 7 figure understated you, and the notice gave you an alternative. That alone is a reason some 2025 returns are carrying a deduction smaller than the law allowed.

Non-employees were told to use earnings statements, receipts, point-of-sale system reports, daily tip logs, settlement organisation records "or other documentary evidence that corroborates the calculation."

The occupation is still your responsibility

One line from Notice 2025-69 is easy to miss and matters on amendment: although the occupation of a non-employee receiving tips does not appear on a 2025 Form 1099, "the payee is still responsible for determining whether the tips received by the payee were received in an occupation that customarily and regularly received tips on or before December 31, 2024."

The absence of a code on the 2025 form was never a safe harbour. It was just an absence.

What amending does not fix

An amended return re-runs the same limits. Before you file one, confirm the deduction actually survives them:

• The cap is $25,000 per return, not per spouse.
• It phases out by $100 for each whole $1,000 of modified AGI above $150,000 ($300,000 on a joint return), rounding the thousands down.
• You need a Social Security number valid for employment.
• If you are married, you must file jointly. Married filing separately gets nothing — and amending from separate to joint is a much larger decision than amending a single line.
• Tips received in the course of a trade or business are capped at the net profit of that business.
• The payment itself has to have been a qualified tip: voluntary, not negotiated, determined by the customer, and paid in cash or a cash equivalent. Service charges and automatic gratuities do not count even when they are distributed to employees.

It is entirely possible to be newly on the occupation list and still get nothing, because the phaseout or the cap or the payment mechanics already answered the question.

Worth doing the arithmetic first

Hypothetical, using only the statutory figures above: a single filer with $130,000 of modified AGI and $6,000 of qualified tips is below the $150,000 threshold, so no phaseout applies and the full $6,000 lands on Schedule 1-A Part II. At a 22% marginal rate that is worth roughly $1,320 — a real amendment. The same $6,000 for a single filer at $195,000 of MAGI is reduced by 45 whole thousands times $100, or $4,500, leaving $1,500 of deduction. Worth perhaps $330. Whether that clears the cost of preparing a 1040-X is a judgement call.

These are illustrations, not estimates of anyone's actual return.

Before you amend

1. Look your occupation up on the final list, not the proposed one.
2. Rebuild the tips figure using a method the notice allows, and keep the documentation.
3. Run the cap and the phaseout before you decide it is worth filing.
4. Check the joint-return and SSN conditions.
5. Use Form 1040-X, and expect the 2026 return to be easier — the 2026 W-2 carries the tips in Box 12 code TP and the occupation in Box 14b.

Start with the occupation: the Treasury Tipped Occupation Code lookup searches the full list, and the official source is IRS.gov/TippedOccupations. Then run the numbers through our Schedule 1-A estimator — and if you are close to a threshold, the rounding rules are not what most people assume.

Estimates and general information, not tax advice. Confirm your specific situation with a tax professional.