Treasury Tipped Occupation Codes (TTOC): what each code covers and where it goes

What the codes are

The 2025 tax law (P.L. 119-21, section 70201) created a deduction for “qualified tips”: cash tips received in “an occupation which customarily and regularly received tips on or before December 31, 2024, as provided by the Secretary.” It told Treasury to publish that list of occupations, and it changed the reporting rules so that employers and payers report both the cash tips and “the occupation described in section 224(d)(1)” of the person who received them.

The statute does not number anything. Treasury and the IRS built the numbering: in the words of the final regulations, they “created a new categorization system based on the 2018 Standard Occupation Classification (SOC Code) system, called the Treasury Tipped Occupation Code (TTOC) system.” Each code is three digits, grouped by hundreds: 100s beverage and food service, 200s entertainment and events, 300s hospitality and guest services, 400s home services, 500s personal services, 600s personal appearance and wellness, 700s recreation and instruction, 800s transportation and delivery.

The list is now final. Treasury proposed 68 codes in REG-110032-25 (September 22, 2025) and finalized 71 in T.D. 10044, published April 13, 2026 and effective June 12, 2026, for tax years beginning after December 31, 2024. The final list added three codes (509 visual artists, 510 floral designers, 810 gas pump attendants) and, in Treasury’s words, “No occupations included on the proposed List of Occupations that Receive Tips in the proposed regulations were removed”. The list itself is in Treas. Reg. 1.224-1(h)Treas. Reg. 1.224-1Treasury regulations, Cornell LII, table 1. There is also a code that is not on the list at all: 000, which the form instructions use for tips from an occupation that does not qualify.

Which box on which form

Each form has one box for the tip amount and one for up to two codes. The tip box is always a breakout of an amount already reported on the form, never an addition to it.

Forms 4137, 4070 and 8027 have no occupation field, and the 2026 instructions for Form 8027 do not mention the codes. Form 1042-S has no tip or occupation box.

The entry rules

The instructions for all four forms use the same three rules. From the 2026 Form W-2 instructions, which the 1099-NEC, 1099-MISC and 1099-K instructions repeat almost word for word:

• Up to two codes. “Enter up to two code(s) based on the occupation(s) that the tips were received in.”
• Three or more occupations: any two. “If tips were received in more than two occupations, include the Treasury Tipped Occupation Code for any two of the three or more occupations in which tips were received.”
• Any nonqualifying occupation: 000. “If any tips were received in a nonqualifying occupation, then "000" must be input as one of the occupation code(s).”

The recipient copies explain what 000 does. The 2026 W-2 tells the employee: “If the occupation code 000 is used, and no other code is included in box 14b, your cash tips are not qualified tips; do not use the amount reported in box 12 (code TP) for the deduction for qualified tips.” The 1099-NEC, 1099-MISC and 1099-K recipient instructions say the same for their boxes. So a code is not a formality: 000 alone tells the worker the tips do not qualify.

On the W-2 the code is required whenever tips are reported with code TP. On the 1099s it goes with any amount in the cash tip box. The instructions send you to the IRS list (IRS.gov/TippedOccupations, also reached as IRS.gov/TTOC) for the codes; the code finder has the full list with the regulation’s descriptions.

Why the code matters to the worker

The code feeds the worker’s deduction under IRC 224IRC 224Internal Revenue Code, Cornell LII. The essentials, from the statute and T.D. 10044:

• Amount. Up to $25,000 a return, reduced by $100 for each $1,000 of modified adjusted gross income over $150,000 ($300,000 on a joint return). The cap is per return, not per occupation.
• Years. Tax years 2025 through 2028. It is available whether or not the worker itemizes, and it does not reduce Social Security and Medicare taxes.
• Qualified tips. Paid in cash or charged (card, check, gift card, payment app and similar), voluntary, not negotiated, and set by the customer. Service charges and automatic gratuities are not qualified tips “even if the amounts are subsequently distributed to employees”, unless the customer is expressly given the option to change or remove them.
• Reporting is a condition. The tips must be on a W-2 or 1099 statement (or reported by the employee on Form 4137). From 2026 they must be separately reported, which is what the tip and code boxes do.
• Other limits. A Social Security number, a joint return if married, and for the self-employed a cap at the net income of the business where the tips were earned.

Only tips received in a listed occupation are qualified tips. That is why the employee instructions tell workers to use the code and the tip amount together when claiming the deduction on Schedule 1-A.

Choosing the right code

The final regulations put the responsibility on both sides: “Taxpayers wishing to claim the deduction and entities responsible for information reporting are primarily responsible for ensuring their occupation is on the List of Occupations that Receive Tips.” The IRS says it will read the occupations “in a fair and impartial manner consistent with their commonly understood meaning.” Points from the regulation and its preamble that settle common cases:

• Match the work, not the job title. The examples are illustrative. The preamble places hiking and ghost tour guides under 705, Santa Claus performers under 208, table game supervisors under 201, doormen under 301 and poker associates under 202. Retail cashiers are not on the list, though food counter cashiers fall under 107 and hotel cashiers under 303.
• Assistants and apprentices are included in an occupation “if they perform the same services as those listed in the occupation description.”
• Managers and supervisors. Tips a manager or supervisor receives through a tip pool are not qualified tips. A manager who receives tips directly while doing a listed job, such as waiting tables, can have qualified tips for that work. Restaurant manager is not a listed occupation.
• Gig and app-based work. The final list added app-based rideshare drivers to 802 and app-based delivery people to 804. Treasury says gig workers can qualify if their occupation is on the list and the other requirements are met.
• Digital content creators (209). A payment required to see the content is not a tip; a voluntary payment after access can be. Any share the platform keeps is not received by the creator, and hosting a platform is not a listed occupation.
• Platforms are conduits. An employer, a third party settlement organization or a one-owner business that passes a tip along “is not a payor of the tip”. The customer is the payor.
• The FLSA does not decide it. Treasury did not use the Fair Labor Standards Act’s $30-a-month test, and the list “has no bearing or effect” on which occupations are tipped under the FLSA.

Tax year 2025 versus 2026

2025 (filed in early 2026). The 2025 forms were not changed, and Notice 2025-62 waived the section 6721 and 6722 penalties for leaving out the separate tip amount or the occupation for tax year 2025. The relief was conditional: it applies only if the payer “otherwise files and furnishes a complete and correct return or statement”, so tips still had to be included in the totals. Payers were encouraged, not required, to give workers the tip amount and occupation some other way, such as a separate statement.

2026 onward (filed in early 2027). The boxes are on the 2026 Form W-2 and the December 2026 revisions of Forms 1099-NEC, 1099-MISC and 1099-K, and the instructions use mandatory wording (“must be input”, “You must also list an occupation code”). Notice 2025-62 says its relief is “limited to returns and statements filed and furnished with respect to taxable year 2025”. We found no IRS notice extending it to tax year 2026 as of October 3, 2026. A missing or wrong code is missing or incorrect information, the kind of error sections 6721 and 6722 penalize, subject to the reasonable cause exception. See the 972CG penalty guide for how those penalties are assessed and answered.

What the IRS has not answered yet

As of October 3, 2026 the IRS has not published payer guidance on these points. Until it does, keep a record of how you decided.

• Splitting one tip amount. Each form has one tip box. When 000 is paired with a listed code, nothing says how much of the amount belongs to each, and the draft 2026 Schedule 1-A has no column for the code.
• Which two of three. The instructions say “any two” with no rule for choosing, and say nothing about the tips from the occupation left out.
• How a platform knows the occupation. Third party settlement organizations must report the occupation of a payee whose tips were “reasonably designated by payors as cash tips”, but no rule says how a platform should determine it, and the regulations do not define “reasonably designated”.
• Whether a wrong code is an inconsequential error. Pub. 1099 lists the errors that are never inconsequential (such as TINs, surnames and money amounts); codes are not on that list, and the IRS has not said how it will treat them.
• Specified service businesses. Tips earned in a specified service trade or business do not qualify, but the regulation reserves that rule (1.224-1(g)). Under Notice 2025-69 the IRS treats a worker in a listed occupation as outside one until January 1 after final rules are issued. The forms have no box for it.
• Tips the employee reports on Form 4137. They can count toward the deduction, but Form 4137 has no place for an occupation code.

All 71 codes at a glance

The codes and occupations below are from Treas. Reg. 1.224-1(h)Treas. Reg. 1.224-1Treasury regulations, Cornell LII, table 1. For each code’s full description, examples and SOC code, search the list or work out what to enter in the box, use the tipped occupation code finder.

000 is not on the list: it is the form instructions’ entry for a nonqualifying occupation. Codes marked * were added in the final list.

Questions people ask

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