In the News: Sasha Thaler Quoted in Massachusetts Lawyers Weekly on Overtime and Tip Taxation Under the OBBBA
Constangy partner Sasha Thaler was quoted in a recent Massachusetts Lawyers Weekly article, “On ‘no tax’ on tips, overtime, don’t believe the hype, attorneys say,” which examines the implications of the One Big Beautiful Bill Act (OBBBA) on overtime calculations and tip reporting.
Sasha noted that employers should be prepared to explain new pay stub details to employees who may not immediately recognize how overtime is displayed. “To the extent that employers aren’t used to having to answer that kind of question, or maybe they have some employees who are not as sophisticated and don’t immediately see that it’s literally the same thing, they should be aware enough of the reasons why they’re changing their reporting to be able to explain what it is that they’ve done,” she said.
She also observed that because the new overtime deduction applies only to FLSA-required overtime, “there’s not a loophole that can be found there.” On tipped income, Thaler raised concerns that the “no tax on tips” slogan could lead to confusion. “Isn’t your first instinct, ‘If there’s no tax on tips, what does it matter what I took home in tips?’” she asked rhetorically. “I think that the unaware employee and employer may actually have more difficulty, if that’s where things go.”
Thaler added that a new provision allowing beauty service businesses to claim a “tip credit” could also add complexity: “I’m glad I’m not a tax preparer because I think there’s going to be a lot of confusion for those folks next year as to who gets what.”
To read the full article on Massachusetts Lawyers Weekly’s website, click here.
Sasha Thaler is a partner and co-chair of Constangy's Investigations practice group with nearly 20 years of experience advising and defending employers across industries on workplace compliance, employment litigation, and dispute resolution. She counsels on a wide range of employment laws, drafts workplace policies and contracts, and represents businesses before state and federal agencies. Sasha also serves as an independent investigator in Title IX and workplace discrimination matters and is a frequent speaker on developments in labor and employment law.
