# No tax on tips for nannies and babysitters

Yes — nannies and babysitters are on Treasury's list of tipped occupations as TTOC 508 (Nannies and Babysitters), so qualified tips from this work can be deducted from federal income tax, up to $25,000 a year for 2025 through 2028, reduced above $150,000 of income ($300,000 filing jointly).

Work out your deduction with the free [calculator on this page](https://rulecost.com/paycheck/no-tax-on-tips/nannies/).

- Treasury Tipped Occupation Code: 508
- Category: Personal services
- Share who reported tips: 0.7%
- Tips as share of pay, among those with tips: 28.8%
- Related SOC codes: 39-9011

What counts as a tip: A nanny paid enough by one family is usually that family’s household employee, and their tips go on the W-2 the family issues. A babysitter working for several families is usually self-employed. Either way, a regular raise or bonus agreed in advance is pay, not a tip.

## Sources

- [T.D. 10044: Occupations That Customarily and Regularly Received Tips; Definition of Qualified Tips (Internal Revenue Bulletin 2026-18)](https://www.irs.gov/pub/irs-irbs/irb26-18.pdf), Internal Revenue Service
- [26 U.S.C. § 224 — Qualified tips](https://www.law.cornell.edu/uscode/text/26/224), Legal Information Institute, Cornell Law School