Carley Passer loves her job as a bartender and server at Junction Pub in Milton.
What she doesn’t love as much is when customers ask her what her “real job” is.
She told WPR’s “Wisconsin Today” that working in the service industry is what she enjoys doing, and it doesn’t feel good when people think she needs some other career.
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“It does kind of hurt my feelings a little bit,” Passer said. “But it’s also one of those things where, as a bartender, you can have that banter back and forth, and I’m able to kind of brush it off in that way.”
Changes to federal and state income tax policies could make these service industry careers easier to sustain.
Part of the Trump Administration’s One Big Beautiful Bill Act that passed last summer created a new federal income tax deduction for tipped wages up to $25,000 — a provision often referred to as “no tax on tips.”
A bipartisan bill proposing the same deduction on state income taxes has passed both the Wisconsin Assembly and the Senate. Gov. Tony Evers has said he’s “willing to take a look” at signing it into law.
In Wisconsin, the minimum wage for tipped employees is $2.33 cents per hour. Some establishments pay their workers a higher hourly wage, but tips still represent a significant portion of their income.
At Commodore Club in Appleton, bartender Ethan Radecki estimates that tips make up well over half of his income.
That creates some fluctuations in his paycheck between slow months and busier times of year that he has to budget for, he told “Wisconsin Today.”
“Sometimes, months that you’re relying on that money, it just doesn’t come in,” Radecki said. “There are some unpredictable things that definitely make it weird to balance.”
He said he filed his taxes this week and noticed a huge difference in his federal return.
The same is true this tax season for John Coia, head bartender and banquet captain at The Rooftop at Hotel Goodwin in Beloit.
“I actually over doubled my tax (refund) from last year compared to this year, just federally,” Coia told “Wisconsin Today.” “I knew it was going to be bigger, but the amount that was bigger was actually really refreshing and good to see.”
State income taxes for service industry workers have remained at the normal rate. But if Gov. Evers signs the “no tax on tips” bill, they could file amended returns for 2025 and realize those savings.
Keeping more of those tips in their pockets instead of losing them to income taxes will help them pay bills, build their savings and continue down the career paths that make them happy.
“I like making the moments happen between not just me and the customer, but between other customers too,” Coia said. “Just having that atmosphere where people can relax and enjoy their time, it’s one of my favorite things.”
