No tax on tips for parking and valet attendants
Yes, parking and valet attendants qualify. The occupation is on the Treasury list of jobs that customarily received tips before 2025 (Tipped Occupation Code 801, transportation and delivery). Qualified tips you earn in 2026 can be deducted, up to $25,000, on Schedule 1-A.
What counts as a tip for parking and valet attendants
Rideshare and delivery-app tips reported on Form 1099-K or 1099-NEC qualify; the app's fares, fees and incentives do not. Most drivers are self-employed, so the deduction cannot exceed the net profit from driving or delivering after expenses such as mileage.
How much could you save?
Federal income tax saved in 2026 for a single filer with $30,000 of other wages.
| Tips in 2026 | Tax saved | Deduction |
|---|---|---|
| $5,000 | $600 | $5,000 |
| $10,000 | $1,200 | $10,000 |
| $15,000 | $1,800 | $15,000 |
| $25,000 | $3,000 | $25,000 |
How to claim it
- Report every tip to your employer so it is included on your Form W-2, or file Form 4137 for unreported tips. If you are self-employed, make sure tips appear on your 1099 or business records.
- Enter your qualified tips and the occupation code 801 on Schedule 1-A, Part II.
- Carry the deduction to Form 1040. You can claim it with the standard deduction.
Other transportation and delivery jobs on the list
Frequently asked questions
Do parking and valet attendants qualify for the no tax on tips deduction?
Yes. Parking and valet attendants are on the Treasury list of occupations that customarily and regularly received tips on or before December 31, 2024 (code 801), so qualified tips earned from 2025 through 2028 can be deducted, up to $25,000 a year.
How much tax would parking and valet attendants save on $10,000 of tips?
About $1,200 in federal income tax for a single filer with $30,000 of other wages in 2026. Social Security and Medicare tax still apply to tips.
Do I need to be an employee to qualify?
No. Both employees and self-employed workers in a listed occupation can claim it. Self-employed workers cannot deduct more than the net profit from the business where the tips were earned.