Tour guides and travel guides are a listed tipped occupation, so reported tips deduct from federal taxable income up to $25,000 through 2028, with or without itemizing. Guiding is unusually tip-dependent — walking-tour, adventure, and travel guides often earn more in end-of-tour gratuities than in base pay — which makes this deduction bigger for guides than for many trades.
The setup varies. Guides employed by a tour operator on a W-2 deduct the tips reported on the wage statement. Independent guides — freelancers, and those running tours through a marketplace or their own booking — are self-employed: card and app tips arrive on a 1099, cash tips go on their own records, and the deduction caps at the net income of the guiding business. Only reported tips count.
The deduction reduces federal income tax, not self-employment tax, and phases out above $150,000 ($300,000 joint). Seasonality is the catch for guides: a big summer of cash gratuities is exactly the kind of income that slips off a return, and 2025 software wasn't looking for it. A 1040-X recovers it.