Georgia has not conformed to OBBBA as of May 2026. Tips are fully taxable at 5.39% state rate. The federal exemption still applies on your federal return only.

Updated May 2026 · 8 min read

Does Georgia Tax Tips in 2026?

Georgia taxes all tip income at a flat 5.39% rate in 2026 with no OBBBA conformity. The rate is lower than it was under Georgia's old graduated bracket system (which topped at 5.75%) and is legislatively committed to decreasing further — but the timing depends on revenue triggers, not a fixed calendar. Here's the current rate structure for Atlanta, Savannah, and Georgia tipped workers.

Georgia's Tax Rate Phase-Down: What's Confirmed vs. What's Projected

PeriodGeorgia RateState Tax on $30k TipsStatus
Pre-2024 (graduated brackets)Up to 5.75%Up to $1,725Historical
2024 (flat tax introduced)5.49%$1,647Confirmed — enacted
2026 (current)5.39%$1,617Confirmed — current rate
Future reductionsToward 4.99%~$1,497 at targetRevenue-trigger dependent — not guaranteed

Source: Georgia HB 1437 (2022) and Georgia Department of Revenue. Future reductions require Georgia to meet specific revenue thresholds before each step occurs.

Georgia vs. Southeast States on Tip Tax Rates

StateState Tax Rate on TipsState Tax on $30k TipsTip Credit?
Florida No state tax0%$0Yes — $3.02
Tennessee No income tax0%$0Yes — federal floor
North Carolina4.5% flat$1,350Yes
Georgia5.39% flat$1,617Yes — federal floor
Virginia5.75%$1,725Yes
South Carolina6.4% top rate~$1,650Yes

Rates for 2026. NC, VA, SC use progressive brackets — effective rate at $30k in tips for a single filer with moderate total income. Source: respective state department of revenue.

Georgia Tax Obligations on Tip Income

TaxRateApplies to Tips?OBBBA Helps?
Georgia state income tax5.39% flatAll tips — no exemptionNo — not conformed
Atlanta city income tax0%None—
Federal income tax10–22%Only above OBBBA thresholdYes — federal only
FICA7.65%All tipsNo

Calculate Your Georgia Take-Home

  1. Total gross = base wages + all tips
  2. Federal: apply OBBBA deduction (up to $25,000 qualified tips, under $160,000 AGI), then $16,100 standard deduction, then 2026 federal brackets
  3. Georgia: 5.39% flat on Georgia taxable income — no OBBBA deduction, Georgia has its own standard deduction ($5,400 single in 2026)
  4. FICA: 7.65% on full gross income
  5. No city income tax in Georgia
Calculate Your Georgia Take-Home →

FAQs: Tips and Taxes in Georgia (2026)

Does Georgia tax tip income in 2026?
Yes. Georgia has not conformed to the federal OBBBA tip exemption. All income, including tips, is taxed at Georgia's flat 5.39% rate in 2026.
What is Georgia's income tax rate in 2026?
Georgia's flat income tax rate is 5.39% in 2026. Georgia replaced its graduated bracket system with a flat tax effective 2024, and the rate is being phased down toward 4.99% based on revenue performance triggers. Source: Georgia Department of Revenue.
Does Atlanta have a city income tax?
No. Atlanta, Savannah, Augusta, and all other Georgia cities impose no city income tax. Only Georgia state income tax applies.
What is the tipped minimum wage in Georgia?
Georgia's tipped minimum wage is $2.13/hr — the federal floor. Georgia's full minimum wage is $7.25/hr (matching federal). Employers must ensure tips bring workers to at least $7.25/hr total. Source: Georgia Department of Labor.
When will Georgia's flat tax rate reach 4.99%?
The phase-down from 5.49% (2024) toward 4.99% is contingent on revenue triggers defined in the legislation. Each reduction step depends on Georgia meeting specific revenue thresholds. The timeline is not fixed — it depends on economic conditions and state revenues. Source: Georgia HB 1437 and subsequent amendments.
Is Georgia expected to conform to the OBBBA tip exemption?
As of May 2026, Georgia has not enacted OBBBA conformity legislation. Given Georgia's generally pro-business legislative direction, conformity is plausible but not confirmed. Monitor the Georgia Department of Revenue for updates.
How does Georgia compare to Florida for tipped workers on state taxes?
Florida has no state income tax — Georgia charges 5.39% on all income including tips. On $30,000 in tips, a Florida worker pays $0 in state tax; a Georgia worker pays approximately $1,617. The difference grows with tip income.

Compare: Florida ($0 state tax) · Arizona (2.5%) · All 50 states →