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Are manicurists and pedicurists tips tax deductible in 2026?

Yes — manicurists and pedicurists are on the IRS tipped occupation list (code 605). Tips in this job are deductible for 2026, up to $25,000, if the customer chose the amount and could have declined.

Treasury Tipped Occupation Code 605 · Personal appearance and wellness · official title: Manicurists and Pedicurists

How tipping works in this job

Nail salons are heavily cash-tipped, which makes this one of the occupations where reported and actual tips diverge most. Many technicians work on commission splits with the salon owner and receive tips directly from clients rather than through payroll. Where the salon takes card payments, the tip line usually flows back to you in cash at the end of the day.

The regulations say: Clean and shape customers’ fingernails and toenails. May polish or decorate nails. Examples given: Nail technician, fingernail sculptor, nail painter.

The thing most likely to disqualify your tips

Card-processing deductions and salon “station fees” do not reduce your tips for this purpose, and neither do they make them disqualify — they are separate business costs. The real disqualifier is the group booking: a bridal party or a spa day billed with an included gratuity is a service charge, and it does not count no matter how it reaches you.

Check your own numbers

Pre-filled for manicurists and pedicurists. Runs entirely in your browser — nothing is uploaded.

Step 1 — your occupation

Checking for Manicurists and pedicurists (Treasury code 605). This occupation is on the list.

Step 2 — is it actually a tip?

Answer for the money you are asking about. If some of your income is tips and some is service charges, run them separately.

Does the customer decide the amount?

A tip has to be an amount the payer chose. A percentage set by your employer or written into a contract is not.

Can the customer decline to pay it?

A tip is voluntary. If the customer had no way to refuse it, it is a charge.

Is it a mandatory service charge or auto-gratuity?

Auto-gratuity on large parties, resort service charges, contracted event gratuities.

Step 3 — your tips and income

The phase-out runs on modified AGI, which for most people is the same as AGI.

How were these tips earned?

3 questions left to answer.

OBBBA Deductions · obbbadeductions.com

Tips deduction worksheet — tax year 2026

Manicurists and pedicurists (code 605) · Single · Prepared October 1, 2026

The three tests, as answered

  • Does the customer decide the amount? not answered
  • Can the customer decline to pay it? not answered
  • Is it a mandatory service charge or auto-gratuity? not answered

Answer the 3 remaining questions above for a result.

Watch out for this in your job: Card-processing deductions and salon “station fees” do not reduce your tips for this purpose, and neither do they make them disqualify — they are separate business costs. The real disqualifier is the group booking: a bridal party or a spa day billed with an included gratuity is a service charge, and it does not count no matter how it reaches you.

Educational estimate only, not tax advice. It runs entirely in your browser and nothing you type is sent anywhere. The deduction is scheduled to expire after tax year 2028.

Estimate only, not tax advice. This site is general information, not tax advice. Figures are estimates and may not reflect the final IRS guidance for the tax year. Confirm your situation with a qualified tax professional or the IRS before filing.

Occupation list and tip tests from T.D. 10044; cap and phase-out from Schedule 1-A Part II. Figures on this site were last checked September 8, 2026. Produced by obbbadeductions.com — nothing entered into the calculator left the browser it was typed into.

How this applies to manicurists and pedicurists

Nail work is among the most cash-tipped occupations on the entire list, and that single fact drives most of what is difficult about it. Clients hand over cash at the end of an appointment, and even where they add a tip on a card, many salons return it to the technician in cash at the close of the day. The result is a real, substantial annual tip figure that exists nowhere in writing unless the technician writes it down.

Compensation structures compound this. A large share of technicians work on a commission split with the salon owner rather than on wages, and some rent their station outright. If you are an employee, reporting your cash tips to the salon is what puts them on your W-2 and makes them deductible. If you rent, you are self-employed, the tips are business income, and the deduction reaches them only to the extent the business is profitable after station rent, product and supplies.

Group bookings are the specific disqualifier to watch for. Bridal parties, spa days and corporate bookings are routinely billed with an included gratuity, sometimes 18 or 20 percent across the whole party. The salon distributes it to the technicians who did the work, and it is not a qualifying tip, because nobody in the party chose the amount or could decline it. On a salon that does a lot of bridal work this can be a significant slice of a technician’s year.

One thing that does not affect your tips figure: card-processing deductions and station fees taken by the salon. Those are costs, handled separately, and netting them off your tips produces a number that is wrong in both directions. Record the tip as received and deal with the costs as costs.

The three tests, whatever your job

  • Paid voluntarily

    The customer sets the amount and can decline to pay it.

  • Paid in cash or a cash equivalent

    Card payments and mobile payments count.

  • Received directly or through a tip pool

    Both routes qualify.

Questions

Are manicurists and pedicurists on the IRS tipped occupation list?
Yes. Manicurists and Pedicurists is Treasury Tipped Occupation Code 605, in the personal appearance and wellness category. The regulations describe it as: Clean and shape customers’ fingernails and toenails. May polish or decorate nails.
What is the most common reason manicurists and pedicurists lose the deduction?
Card-processing deductions and salon “station fees” do not reduce your tips for this purpose, and neither do they make them disqualify — they are separate business costs. The real disqualifier is the group booking: a bridal party or a spa day billed with an included gratuity is a service charge, and it does not count no matter how it reaches you.
How much of my tips can I deduct?
Up to $25,000 per return, whatever your filing status. The cap applies first, then the amount is reduced by $100 for every $1,000 of modified adjusted gross income above the threshold for your filing status.
Does a mandatory service charge count as a tip?
No. A mandatory service charge or automatic gratuity is not a qualifying tip, and the final regulations confirmed this explicitly. It does not qualify even when the customer cannot decline it — a qualifying tip has to be an amount the customer chose to give.

Related occupations in personal appearance and wellness

Occupation data transcribed from T.D. 10044 — final regulations on occupations that customarily and regularly received tips, Treas. Reg. § 1.224-1(h) table 1, last verified 2026-09-08. Read the regulations.