Tipped Minimum Wage by State
Federal law lets an employer pay a tipped worker $2.13 an hour in cash, provided tips bring them up to the minimum wage. 16 jurisdictions still allow exactly that. 7 require the full minimum wage in cash before a single tip is counted.
This is why tipping feels obligatory in one state and optional in another.
Federal baseline
- Minimum wage
- $7.25
- Cash wage
- $2.13
- Max tip credit
- $5.12
- Counts as tipped
- More than $30 a month in tips
The tip credit is the gap the employer is allowed to fill with your tips instead of wages. Where the credit is $5.12, roughly seventy per cent of the minimum wage is coming out of the tip jar. States may set a higher cash floor, or none at all.
Full minimum wage before tips
7 jurisdictionsThese states do not allow a tip credit at all. The employer pays the full state minimum wage in cash, and tips are on top of it rather than a substitute for it.
| State | Cash wage | Tip credit | Combined | Notes |
|---|---|---|---|---|
| Alaska | $14.00 | None | $14.00 | |
| California | $16.90 | None | $16.90 | |
| Minnesota | $11.41 | None | $11.41 | |
| Montana | $10.85 | None | $10.85 | Businesses with gross annual sales over $110,000. Smaller non-FLSA businesses: $4.00. |
| Nevada | $12.00 | None | $12.00 | |
| Oregon | $15.55 | None | $15.55 | Statewide standard. Portland metro $16.80; nonurban counties $14.55. |
| Washington | $17.13 | None | $17.13 |
Cash wage above the federal $2.13
28 jurisdictionsThese states allow a tip credit but set the cash floor higher than the federal $2.13. If tips fall short, the employer must top up to the combined rate.
| State | Cash wage | Tip credit | Combined | Notes |
|---|---|---|---|---|
| Arizona | $12.15 | $3.00 | $15.15 | |
| Arkansas | $2.63 | $8.37 | $11.00 | |
| Colorado | $12.14 | $3.02 | $15.16 | |
| Connecticut | $10.56 | $6.38 | $16.94 | Hotel and restaurant rate. Bartenders who customarily receive tips: $8.71 cash wage. |
| Delaware | $2.23 | $12.77 | $15.00 | |
| District of Columbia | $10.30 | $8.10 | $18.40 | Cash wage must be at least 56% of the standard minimum wage. |
| Florida | $10.98 | $3.02 | $14.00 | Scheduled to reach $15.00 on 30 September 2026. |
| Hawaii | $14.75 | $1.25 | $16.00 | Tip credit allowed only if cash wage plus tips is at least $7.00 above the minimum wage. |
| Idaho | $3.35 | $3.90 | $7.25 | |
| Illinois | $9.00 | $6.00 | $15.00 | Tip credit capped at 40% of the minimum wage. Chicago sets its own, higher rate. |
| Iowa | $4.35 | $2.90 | $7.25 | Tip credit capped at 40% of the minimum wage. |
| Maine | $7.55 | $7.55 | $15.10 | Tip credit capped at 50% of the minimum wage. |
| Maryland | $3.63 | $11.37 | $15.00 | |
| Massachusetts | $6.75 | $8.25 | $15.00 | |
| Michigan | $5.49 | $8.24 | $13.73 | Cash wage rises annually until it reaches 50% of the state minimum in 2031. |
| Missouri | $7.50 | $7.50 | $15.00 | Tip credit capped at 50% of the minimum wage. |
| New Hampshire | $3.27 | $3.98 | $7.25 | |
| New Jersey | $6.05 | $9.87 | $15.92 | $15.23 minimum for employers with fewer than 6 staff and seasonal work. |
| New Mexico | $3.00 | $9.00 | $12.00 | |
| New York | Varies | Varies | $17.00 | $17.00 in NYC, Long Island and Westchester; $16.00 elsewhere. Tipped rates vary by region and employer type. |
| North Dakota | $4.86 | $2.39 | $7.25 | Tip credit capped at 33% of the minimum wage. |
| Ohio | $5.50 | $5.50 | $11.00 | Employers with gross annual receipts of $405,000 or more. Below that, the state minimum is $7.25. |
| Pennsylvania | $2.83 | $4.42 | $7.25 | Tipped-employee threshold is $135 per month. |
| Rhode Island | $3.89 | $12.11 | $16.00 | |
| South Dakota | $5.93 | $5.92 | $11.85 | Tip credit capped at 50% of the minimum wage. |
| Vermont | $7.21 | $7.21 | $14.42 | Tip credit capped at 50% of the minimum wage. |
| West Virginia | $2.62 | $6.13 | $8.75 | Applies only to employers with six or more employees and to state agencies. |
| Wisconsin | $2.33 | $4.92 | $7.25 |
Federal $2.13 cash wage
16 jurisdictionsHere an employer may pay as little as $2.13 an hour in cash, with tips expected to cover the rest up to the minimum wage. Tips are most of the take-home pay.
| State | Cash wage | Tip credit | Combined | Notes |
|---|---|---|---|---|
| Alabama | $2.13 | $5.12 | $7.25 | No state minimum wage law; the federal rate applies. |
| Georgia | $2.13 | $5.12 | $7.25 | State minimum wage law does not apply to tipped employees. |
| Indiana | $2.13 | $5.12 | $7.25 | |
| Kansas | $2.13 | $5.12 | $7.25 | State law excludes employment covered by the federal FLSA. |
| Kentucky | $2.13 | $5.12 | $7.25 | |
| Louisiana | $2.13 | $5.12 | $7.25 | No state minimum wage law; the federal rate applies. |
| Mississippi | $2.13 | $5.12 | $7.25 | No state minimum wage law; the federal rate applies. |
| Nebraska | $2.13 | $12.87 | $15.00 | |
| North Carolina | $2.13 | $5.12 | $7.25 | Tip credit requires a signed certification of tips received from each employee. |
| Oklahoma | $2.13 | $5.12 | $7.25 | State law excludes employment covered by the federal FLSA. |
| South Carolina | $2.13 | $5.12 | $7.25 | No state minimum wage law; the federal rate applies. |
| Tennessee | $2.13 | $5.12 | $7.25 | No state minimum wage law; the federal rate applies. |
| Texas | $2.13 | $5.12 | $7.25 | State law excludes employment covered by the federal FLSA. |
| Utah | $2.13 | $5.12 | $7.25 | State law excludes employment covered by the federal FLSA. |
| Virginia | $2.13 | $10.64 | $12.77 | |
| Wyoming | $2.13 | $5.12 | $7.25 | State minimum is $5.15; the federal rate applies to FLSA-covered employers. |
What this changes for you
The percentage people quote does not move much across the country — 18 to 20% is the convention almost everywhere. What moves is what happens if you do not pay it. In a state paying $2.13, skipping the tip takes most of that hour's pay with it. In a state that pays the full minimum first, the same decision costs the worker a bonus rather than a wage.
It also explains a pattern travellers notice and misread: tipping pressure is not uniformly a US phenomenon, it is concentrated where the tip credit is largest. Both facts can be true — the convention is national, the stakes are not.
One thing the table does not capture: cities can set their own floors. Chicago is phasing out its tip credit entirely on a schedule the City Council paused in 2026, and several other cities sit above their state's rate. Check the city guides where a local rule applies.
Source
Figures are taken in full from the US Department of Labor, Wage and Hour Division — Minimum Wages for Tipped Employees, the table revised 1 July 2026. Last checked against the source on 2026-08-31. Where a state sets different rates by employer size, industry or region, the note column says so and the DOL page carries the detail.
State rates commonly change on 1 January. This is general information, not legal or employment advice; for an individual situation the relevant state labour office is the authority.