Business
An Illustrated Guide to Who Really Benefits From ‘No Tax on Tips’
There’s no question that President Trump’s proposal to stop taxing tips has broad appeal. It’s popular in polling, lawmakers in both parties support it, and now a version of the idea is on its way to becoming law.
But the effect of the policy would actually be quite narrow. About 3 percent of American workers receive tips, but about a third of those employees would not see a gain from the change.
That’s because of the way Republicans structured the policy in the tax legislation they passed through the House recently. Here’s who would benefit under their plan — and who wouldn’t.
The proposal would leave out workers who are not tipped.
The tax break is good news for people in industries like dining, where tips are a big part of worker pay. But it also means that two employees making the same amount, one a bartender and one a retail salesperson, could soon face very different tax bills.
These two workers each make $40,000, but the tipped worker would owe a lot less in taxes.
The tax exemption would create a huge incentive for more people to try to earn tips. The Republican legislation lays out some ground rules, tasking the Treasury Department to limit the tax break to jobs in which workers have traditionally received tips. This could become the subject of intense lobbying, as companies try to convince the government that their employees deserve the tax break. Uber and DoorDash have already pushed to make sure their drivers can qualify for tax-free tips.
Many of the lowest-earning tipped workers wouldn’t benefit much, or at all.
Another obstacle to benefiting from the tax break is the way income is taxed in America. In general, before they pay taxes, Americans subtract deductions from their income, and then the government assesses tax on that smaller amount of money.
Everyone can take the standard deduction, which would be worth $16,000 for individuals and $32,000 for married couples this year under the Republican tax bill. “No tax on tips” would take the form of a deduction people can claim on top of the standard deduction, shrinking their taxable income even more.
But for a tipped worker who doesn’t make much more than the standard deduction — say a college student who waits tables over the summer — the ability to claim an additional deduction would not generate much in tax savings. Someone making less than the standard deduction would have no taxable income to begin with.
The policy would save this low-wage waiter a small amount.
It’s important to note that the tips exemption applies only to the federal income tax. Workers would still owe payroll taxes, like the 6.2 percent Social Security tax, on their tipped income. They may also owe state income taxes on their tips.
For many low-income Americans, payroll taxes, rather than the income tax, are the biggest taxes they pay. Roughly 37 percent of tipped workers already don’t owe any federal income tax, according to an estimate from the Budget Lab at Yale.
Others wouldn’t gain because other benefits already eliminate their tax burden.
There are other tax breaks that could eliminate a worker’s tax liability before “no tax on tips” comes into the picture. For example, a full-time Uber or Lyft driver who can take advantage of the mileage deduction, which increases with every mile driven, may not have much use for another tax break.
The policy wouldn’t make a difference for this ride-share driver.
An exception to this would be tax benefits that are “refundable.” These are tax credits, like the earned- income tax credit, that give money to Americans even if they don’t owe anything in income tax. So these tax credits can become cash payments to low-income Americans. Because of that, workers could conceivably use the tips deduction to reduce their tax bills to zero and still receive the same benefit from a refundable tax credit.
The more money someone makes, the bigger the benefit.
The deduction would be most meaningful for those who make enough to owe a fair amount in income taxes. A typical tax cut for someone earning enough to benefit from the plan could be worth roughly $1,800.
This hairdresser would save the typical amount among those who would benefit.
This dynamic is a microcosm of how cuts to income taxes often work: The more money you make, the more you pay in tax and therefore the more you save from a tax cut. In this case, though, your benefit would depend both on how much you make and what share of your income comes in the form of tips.
This Las Vegas blackjack dealer would save a lot based on his significant tips.
This would be true up to a point. The Republican legislation would bar tipped workers making more than $160,000 from claiming the break. (That level would apply for this year and increase over time.)
The cut-off is a stark one. A tipped worker making $160,001 would, under the bill, receive nothing, potentially encouraging people to try to lower their earnings to claim the tax break. Making that extra dollar could mean thousands in additional taxes.
“No tax on tips” could end up as a short-lived experiment. In the House-passed bill, the policy would last only through 2028, though the legislation could change in the Senate.
Many tax-policy experts are rooting for the demise of the deduction, which they see as another potential hole in a tax system so strewn with carve-outs that it is often compared to Swiss cheese. In general, they would prefer a system that charges roughly the same tax on workers with roughly the same earnings, rather than creating a tax advantage for certain types of work.
“It’s the exact opposite of the general principles that tax policy purists advocate for,” said Joseph Rosenberg, a senior fellow at the Urban Institute.
About the data
Illustrated examples were constructed using data from a summary of the House Republican bill (proposed tips policy, standard deductions and tax rates); the Bureau of Labor Statistics (typical wages by occupation); companies and industry groups (estimated typical tip shares); and analyses from the Budget Lab at Yale and the Tax Policy Center (distributional effects of the policy). Workers in all examples have a single tax-filing status.
Business
This startup wants to bring driverless freight trucks to California’s roads, but drivers are pushing back
A Bay Area startup is trying to reinvent the semitruck by making the gas-guzzling giants electric, autonomous and designed for efficiency.
Humble Robotics, founded last year in San Francisco, has raised $24 million to develop a cabless freight truck that lacks a steering wheel, gas pedal and driver’s seat.
The company says its reimagined truck could move freight across California and other states while saving money and reducing carbon dioxide emissions.
Humble Robotics emerged from stealth in April with seed funding led by Eclipse Capital, a Palo Alto-based venture capital firm, and Energy Impact Partners.
A rendering of the Humble Hauler, an electric, autonomous freight truck under development by the San Francisco startup Humble Robotics.
(Eyal Cohen)
The company is looking to capitalize on new regulations in California that could pave the way for autonomous trucks to hit public roads in the near future.
But the technology still faces hurdles, experts said, and labor groups including the Teamsters are raising alarms over safety and availability of jobs.
“We’re building an electric autonomous platform for moving freight, and when we were conceiving the company, the goal was to move freight at the lowest possible cost,” said Eyal Cohen, founder and chief executive of Humble Robotics. “We just want to bring everybody along into modernizing this technology.”
Cohen, who has spent nearly two decades working on electric and autonomous vehicles at companies including Uber, Apple and Waabi, said Humble’s driverless truck dubbed the Humble Hauler could begin customer pilots within the year.
In April, the California Department of Motor Vehicles revised its regulations for autonomous vehicles and lifted a ban on autonomous trucks weighing 10,001 pounds or more. Heavy-duty autonomous vehicles, however, are required to begin testing with a human safety driver and must complete 500,000 miles of testing at each stage of certification.
Humble Robotics has not yet applied for a California DMV autonomous vehicle permit and was originally planning testing operations in Texas. Cohen said the company will adapt to the new regulations in California.
“Our focus is now shifting back to our home state of California given these recent changes,” Cohen said. “We look forward to working with the DMV to understand the requirements of these changes and plan our operations in this state.”
Humble Robotics faces competition from other autonomous trucking companies including Pittsburgh-based Aurora and Bay Area-based Kodiak.
Both Kodiak and Aurora are developing self-driving trucks with traditional driver’s components like a steering wheel. By forgoing the front cab, Humble Robotics could face additional regulatory hurdles, said Dan Sperling, founding director emeritus of the Institute of Transportation Studies at UC Davis.
“At what point they would approve a truck without a steering wheel or pedals and without a cab in the vehicle, that’s probably going to be a little longer,” Sperling said. “Without a cab, that means what happens when something goes wrong, you can’t get someone in there to drive it.”
Heavy-duty vehicles without a cab known as automated guided vehicles already exist in controlled environments like marine ports. These vehicles are not fully autonomous, but independently follow a predetermined route.
Cohen said Humble Robotics is working to make cabless vehicles applicable to public roads, particularly those surrounding the busy ports of Los Angeles and Long Beach.
“Humble aims to partner with ports, terminal operators, and intermodal shipping companies for initial deployments,” Cohen said. “We’ve been impressed by the Long Beach Container Terminal’s embrace of state-of-the-art technology.”
The company employs fewer than 50 people and relies on technology similar to what’s used in self-driving cars, including radar, lidar and cameras that provide a 360-degree view around the vehicle. The truck will also use AI to make driving decisions with “intelligent reasoning that adapts to any scenario,” the company’s website says.
“What’s unique at Humble compared to past endeavors is that cameras are the primary mechanism that we use for doing the work, where lidar and radar are more of a backup,” Cohen said.
The company declined to share the production or sale price of the vehicle, and would not disclose its finances.
The Humble Hauler is a Class 8 vehicle, the same group as semitrucks, and has a universal carrying platform that can accommodate typical cargo containers or other loads like a concrete mixer. The truck will have an electric range of 200 miles and a max speed of 55 miles per hour.
Though the Hauler is in the same class as long-haul trucks, Cohen said its primary use case will be for shorter, back-and-forth journeys. Long-haul electric trucks are harder to scale because they require a large, expensive battery.
As of last year in California, nearly one in four new trucks, buses and vans were zero-emission. Zero-emission vehicles made up around 23% of new medium- and heavy-duty truck sales in the state in 2024, according to a release from Gov. Gavin Newsom’s office.
Earlier this year, California’s clean-truck voucher program reserved $165 million to subsidize Tesla’s planned electric semitruck.
A rendering of the Humble Hauler, an electric, autonomous freight truck under development by the San Francisco startup Humble Robotics.
(Eyal Cohen)
“For a lot of moves that we do in freight, like moving back and forth from two points that are only a few miles apart, electric is a really great technology,” Cohen said.
California is among the largest markets for freight trucking, employing more than 130,000 drivers. Eight out of every 1,000 jobs in California belong to a truck driver, according to Fremont Contract Carriers.
That means taking away human driver jobs could be particularly detrimental in the state. Teamsters California, which represents 250,000 workers across dozens of industries, strongly opposed the DMV’s move to lift the ban on autonomous trucks.
“The DMV’s decision to rush forward with driverless heavy‑duty trucks is reckless, and we will use every tool necessary to stop it,” Teamsters California said in a statement. “These rules put our streets, our highways, and our jobs in jeopardy.”
Cohen said he does not believe automated trucking will fully replace human jobs any time soon.
“Obviously people are concerned about autonomous freight and what it means,” he said. “There are millions of Class 8 trucks out there and it’ll take a very long time for all those to become automated. A truck driver today will have a job for the rest of their career.”
Communities in California and beyond are gradually warming up to self-driving cars with the arrival of Waymo and Zoox robotaxis. But autonomous trucks are likely to face more scrutiny, Sperling of UC Davis said.
“There’s an optics issue, and that is if you are driving down the road and see this massive truck next to you with no driver, you’re going to freak out,” Sperling said. “If something goes wrong, the repercussions are massive.”
Business
‘I got crushed’: AI giants are funding ad wars in races across the country
WASHINGTON — In congressional races across the country, a new crop of super PACs is taking to the air with millions of dollars worth of advertisements to sway voters.
“President Trump said it best, ‘Celeste Maloy will never let you down,’” says one advertisement supporting the Utah Republican representative in her upcoming primary election.
“Standing up to big pharma, fighting for local jobs, Val Hoyle doesn’t back down,” says an ad backing the Oregon Democratic representative ahead of her primary victory last month.
The super PACs have nondescript names — such as Jobs and Democracy PAC and American Mission — and the text is so generic that it almost seems to have been created by artificial intelligence.
That isn’t so far off the mark. The AI industry has funded the ads.
One network of super PACs is linked to Anthropic, maker of the popular AI tool Claude, and the other to Open AI, maker of ChatGPT.
They have been among the most prolific political spenders so far in the 2026 midterm elections, splashing out more than $37 million to date to influence races across the country and making the groups among the biggest outside spenders so far in congressional races. That number could grow exponentially as campaign season heats up closer to the November election — and as the Silicon Valley giants prepare initial pubic offerings that are poised to raise billions of dollars for the companies and their executives.
The AI political spending boom comes as emerging technology companies have become increasingly “comfortable with using their power to achieve a political goal,” said Adam Kovacevich, a former Google public policy executive and founder of Chamber of Progress, a technology trade group with a progressive orientation.
The leading AI companies have a history.
Anthropic was formed by former OpenAI employees who were concerned that the company was less focused on its original mission to safely harness the power of AI.
The companies are now the leading drivers of the burgeoning AI industry, and their competing views about how the technology should be regulated are playing out in a wide-ranging political ad spending war that has targeted congressional races in big cities and rural areas alike.
OpenAI thinks AI should be regulated solely at the federal level.
Anthropic calls for more stringent regulation and supports efforts by states such as New York and California that have passed more aggressive AI laws.
The groups spending in these races are super PACs, which are able to raise and spend unlimited amounts of money in federal races thanks to the 2010 Citizens United Supreme Court decision.
In some races, the AI-backed political groups have spent more than the candidates they are backing.
“There was no way as a grassroots person that I could compete with that kind of money,” said Al Olszewski, whose opponent in a Montana Republican congressional primary beat him by 30 points after getting a boost from $877,000 in ads from a super PAC backed by OpenAI’s co-founder. “I got crushed.”
The AI behemoths have emphasized that they are independent from the political groups.
One group counts $25 million in support from OpenAI co-founder Greg Brockman and his wife, Anna, alongside $100 million tied to one of Silicon Valley’s biggest venture capital firms, which holds a large stake in OpenAI. The global policy chief for OpenAI was reportedly involved in conceiving the group.
The other side has gotten $20 million from Anthropic and millions more from donors whose identities are not public.
This anonymous political cash is commonly known as dark money, and its prevalence is growing.
(Los Angeles Times photo illustration; source photos courtesy of the Tech Oversight Project)
“This has become very normalized now,” said Brendan Glavin, director of insights at OpenSecrets, which tracks campaign spending. “In 2024, we tracked over $1 billion in dark money.”
That total was $350 million higher than the previous presidential election.
The crypto playbook
The political activity of these AI companies and executives reflects a dramatic shift from how emerging technology companies have historically engaged with politics.
Google, for example, didn’t hire its first in-house Washington lobbyist until after the company had gone public in 2005.
“I think that for a long time, the tech industry lobbying strategy was just ‘leave us alone,’” Kovacevich said.
He sees the spending by these AI-linked super PACs as following the recent playbook developed by the cryptocurrency industry, which has funded the only network of political groups that has spent more on congressional races this year than those linked to OpenAI.
“I think what the crypto industry realized was that there’s no substitute for building up political power,” Kovacevich said.
The political stakes for these technology companies are significant.
“AI policy is far from settled,” said Asad Ramzanali, the former deputy director for strategy in the White House Office of Science and Technology Policy during the Biden administration and the director of artificial intelligence and technology policy at the Vanderbilt Policy Accelerator.
Earlier this month, the Trump administration banned foreign nationals from using the most powerful AI model developed by Anthropic — and even banned the company’s own employees from it — which forced the company to restrict access for all users.
Manhattan matchup
The two super PAC networks have largely shied away from producing ads that mention AI and have mostly chosen to avoid competing against each other in the same races.
There’s one big exception.
In the marquee Manhattan Democratic congressional primary to replace retiring Rep. Jerry Nadler (D-N.Y.), each side has spent millions of dollars.
While the field includes Kennedy scion and social media star Jake Schlossberg and former Republican turned Trump critic George Conway, the target of all the AI-backed spending has been Alex Bores, a former Palantir data scientist who now serves in the New York state Assembly.
New York congressional candidate sponsored a state measure Bores requiring major AI companies to be transparent about their safety protocols and promptly report safety incidents.
(Yuki Iwamura / Associated Press)
That’s because Bores sponsored a state bill, known as the RAISE Act, that requires major AI companies to be transparent about their safety protocols and promptly report safety incidents. The bill was signed into law in December 2025.
The ads sponsored by the group tied to OpenAI, which has spent more than $7.5 million in the race, paint Bores as someone who can’t be trusted.
They cite his support from other tech billionaires, including former crypto mogul and convicted financial fraudster Sam Bankman-Fried, whose super PAC spent $100,000 to support Bores in 2022 when he first ran for New York Assembly.
“Is that really who should be shaping AI safety for our kids?” one ad asks.
An ad sponsored by the Anthropic-backed network, which has also spent more than $7.5 million supporting Bores, makes the case that the bill he sponsored is exactly why he should be elected.
“As a computer engineer, Alex Bores saw how dangerous unregulated AI could be and he wrote New York’s RAISE Act to put real safeguards on A.I. and hold big tech accountable,” the ad says.
The AI ad barrage in New York has even included what might be considered a kumbaya moment in the ad wars — another super PAC created to support Bores is most heavily backed by both an employee of Anthropic and an employee of OpenAI, who both focus on AI safety.
The group, Dream NYC, has spent more than $1.7 million supporting Bores.
Bores and fellow New York State Assemblymember Micah Lasher have been atop the most recent polls in the race ahead of the June 23 primary.
A general view of businesses in St. George, Utah, on Wednesday.
(Ian Maule / For The Times)
Rural Republicans
For voters in many parts of the country, the debate over AI policy has played out locally as a debate over the massive data centers required to power the technology.
In Utah, a proposed data center in Box Elder County, backed by “Shark Tank” television personality Kevin O’Leary, has generated controversy because of questions about its impact on resources in the drought-prone state and its environmental effect on the nearby Great Salt Lake.
In the state’s most competitive Republican congressional primary — the vast, newly drawn 3rd Congressional District — both candidates expressed concerns about how the project has been developed and called for greater transparency in this plan and for future data centers in the state.
Utah congressional candidates Phil Lyman and Celeste Maloy in a debate on June 1. A super PAC backed by Anthropic has spent more than $920,000 to support Maloy.
(Rick Egan / Pool / The Salt Lake Tribune Via Associated Press)
Despite their similar position on the project, a super PAC backed by Anthropic has spent more than $950,000 to support Maloy, who is running in the new district after the boundaries of her old district changed.
“It’s a lot of money to throw at a race,” said her opponent, Phil Lyman, a former conservative Republican state Representative who ran to the right of Utah Republican Gov. Spencer Cox in an unsuccessful primary challenge in 2024.
Lyman insists he is no AI skeptic.
“I’m not anti data centers, I’m pro-transparency,” he said. “I think the future is bright with AI.”
The group said it is backing Maloy because it sees her as “someone who’s worked the issue” of AI regulation and who “has demonstrated leadership” with Republicans in Congress.
Maloy’s campaign didn’t respond to request for comment.
Utah congressional candidate Phil Lyman speaks during a Cottage Meeting at the SunRiver Community Center Ballroom in St. George, Utah, on Wednesday.
(Ian Maule / For The Times)
But Lyman suspects the group’s support for Maloy ahead of their June 23 primary has more to do with old-fashioned politics than any emerging technology.
One of the two co-founders of the political group is Chris Stewart, Maloy’s predecessor in Congress.
“Everything that they’re doing feels very coordinated,” Lyman said. “It makes you wonder if he’s still really controlling that seat.”
Business
Tractor-trailer crosses center divider in Irwindale, killing 1 and injuring 30
A big rig crossed the center divider on the 210 Freeway in Irwindale on Saturday morning, killing one and injuring 30, authorities said.
The mass accident took place before 9 a.m. west of Irwindale Avenue, where emergency personnel arrived to find the truck had collided with several vehicles, the Los Angeles County Fire Department said in a social media post.
One person was pronounced dead at the scene and two were critically injured. Eight minors were taken to the hospital and 22 other crash victims declined treatment, the department said.
The California Highway Patrol temporarily shut down all westbound lanes of the freeway, diverting traffic onto Irwindale Avenue, before opening up one lane.
The CHP issued a SigAlert warning of traffic delays on the westbound lanes, with two lanes on the eastbound side of the freeway also temporarily closed.
The cause of the crash is under investigation.
-
New Mexico23 seconds agoOsha Canyon Fire – June 21 Update
-
North Carolina3 minutes agoMore than 100 vendors celebrate Father’s Day at Highland Brewing
-
North Dakota9 minutes agoTioga woman seriously injured in Ward County crash
-
Ohio16 minutes ago
Operation 'Woah Nellie' in Masury, Brookfield Township, Ohio forces shelter to stop animal intake
-
Oklahoma18 minutes agoOh, Hello: Four-Star Oklahoma LB Case Alexander Commits To Penn State
-
Oregon31 minutes agoSEC heavyweights likely landing spots for Oregon OF Angel Laya
-
Pennsylvania34 minutes agoNeighbors say ‘hundreds of rats’ are running through their yards every night
-
Rhode Island39 minutes agoIn Taylor Swift’s R.I. beach town, every clue becomes a wedding rumor