Solano Real Estate Scene: Jim Porter
Article By: Jim Porter – July 19, 2025
Tip income was almost all cash and mostly unclaimed, under-the-table income back in the days when people carried cash in their pockets.
Now, not only does nobody have $10 on them, places like the Golden One Arena won’t even take cash. Golden One takes my $28 for two beers and then asks me to electronically choose a tip starting at something like 15% up to 30% in the quick and easy check-a-box section of the screen, or I can take longer at the counter and customize my tip based on the service.
Wow, talk about a great sale strategy: They lay a little bit of a subliminal guilt trip on their patrons to tip someone that you may never see again after they hand you a hot dog.
Nowadays, homebuyers that live on tips are easier for lenders to qualify for mortgages because most of it is not under the table and the tips are listed on pay stubs and W-2 forms. This “No Tax on Tips” won’t make it easier for waiters and bellhops to qualify, but it will make it easier for a middle-class family to afford a house payment.
I haven’t read the “Big Beautiful Bill,” but it looks like people that make tips from jobs that historically have tipping will be able to deduct up to $25,000 of tip income per year from their federal taxable income.
The “No Tax on Overtime” sounds like it’s limited to a deduction of $12,500 for a single filer and $25,000 for people filing married. Again, this will not improve the number of qualified home buyers, but in our market, a huge number of my clients work a lot of overtime.
Tens of thousands of people in Solano and Yolo work OT and many count on the extra income. Cops, correctional officers, refinery workers, firefighters, medical personnel, airport employees and construction workers of all kinds will benefit from the BBB.
Believe it or not, we often see hard-working loan applicants that make $80,000 in base pay and $40,000 to $50,000 in OT every year. These tax breaks for middle-class, first-time buyers and homeowners that are thinking about selling and moving up might just motivate a few of them to jump off the fence.
Jim Porter, NMLS No. 276412, is the branch manager of Solano Mortgage, NMLS No. 1515497, a division of American Pacific Mortgage Corporation, NMLS No. 1850, licensed in California by the Department of Financial Protection and Innovation under the CRMLA / Equal Housing Opportunity. Jim can be reached at 707-449-4777.
