Short answer: In Illinois, employers can pay tipped workers a cash wage of $9.00 an hour, as long as tips bring them up to the $15.00 minimum wage. The most an employer can count from tips, the tip credit, is $6.00 an hour.
Illinois tipped wage at a glance
| Illinois | |
|---|---|
| Minimum wage | $15.00 an hour |
| Cash wage for tipped workers | $9.00 an hour |
| Maximum tip credit | $6.00 an hour |
| Who counts as a tipped employee | Federal rule: someone who regularly gets more than $30 a month in tips |
| In force since | 1 January 2025 |
The federal tipped minimum is $2.13 an hour with a $5.12 tip credit toward the $7.25 federal minimum wage. Where a state sets a higher figure, the higher one applies.
An example week
A server works 30 hours. The employer pays at least 30 x $9.00 = $270.00 in cash wages. To reach the minimum wage of 30 x $15.00 = $450.00, the server's tips must add up to at least $180.00. If they make less in tips that week, the employer must pay the difference.
Local rates and exceptions
Tipped cash wage is 60% of the minimum. Chicago (4+ employees) $17.05 and tipped $12.96 from 1 Jul 2026; Chicago paused its tip credit phase out, next cut 1 Jul 2028 for 21+ employee firms. Cook County $15.40, tipped $9.25.
Tip pools and who keeps the tips
Illinois law does not ban tip pooling among employees where it is otherwise allowed, so federal rules apply: with a tip credit, only staff who customarily and regularly receive tips can be in the pool, and managers, supervisors and owners cannot take any of it. I could not confirm an extra Illinois rule.
Federal FLSA: employers, managers and supervisors may not keep any part of employees' tips. A mandatory tip pool may include only customarily tipped staff when a tip credit is taken; if the full minimum wage is paid, back-of-house staff may share the pool.
To share a pool fairly by hours or points, use the tip split calculator. To work out what a server owes support staff, use the tip-out calculator.
Who owns the tips
Since 1 January 2020 the Illinois Wage Payment and Collection Act says gratuities belong to the employee and your employer cannot keep them. Tips must be paid within 13 days after the end of the pay period in which you earned them.
Income tax on tips in Illinois
Illinois taxes tips as income at its flat state rate. I could not confirm whether Illinois has adopted a deduction like the federal 2025 tips deduction, so check the Illinois Department of Revenue.
Other rules
- Illinois requires 24 consecutive hours of rest in every 7 days under the One Day Rest in Seven Act, and a 20 minute meal break for shifts of 7 and a half hours or more.
- Workers 18 and over in their first 90 days can be paid a training wage of $9.00 if the employer uses the tip credit, or $14.50 if it does not.
The agency in charge is the Illinois Department of Labor.
Tips and federal income tax
From 2025 to 2028, up to $25,000 of qualified tips a year can be deducted from federal taxable income. See the no tax on tips calculator for who qualifies and what it saves.
Taking tips by card
Customers carry less cash. A personal QR code lets them tip you by card, Apple Pay or Google Pay from their own phone, with no app to install. See QR code tip jars by job.
Sources
- US DOL WHD, Minimum Wages for Tipped Employees (revised 1 Jul 2026)
- US DOL WHD, State Minimum Wage Laws (updated 1 Jul 2026)
- Your Rights Under Illinois Employment Laws (2026 poster)
- Minimum Wage/Overtime FAQ
- New Law Guarantees Tips Are the Property of the Employees
- 29 CFR 531.54 Tip sharing and tip pooling
Checked in October 2026 against the sources above. Wage rates change, often on 1 January and 1 July; check the state labor department before relying on a figure. This is general information, not legal advice.
Common questions
What is the tipped minimum wage in Illinois in 2026?
In Illinois, employers can pay tipped workers a cash wage of $9.00 an hour, as long as tips bring them up to the $15.00 minimum wage. The most an employer can count from tips, the tip credit, is $6.00 an hour.
Does Illinois allow a tip credit?
Yes. Employers can count up to $6.00 an hour of tips toward the $15.00 minimum wage.
What happens if my tips do not make up the minimum wage?
When an employer pays a tipped cash wage, it must make up any shortfall so that your cash wage plus tips is at least the full minimum wage for the hours you worked.
Can my employer or manager keep part of my tips?
No. Under federal law, employers, managers and supervisors may not keep any part of employees’ tips, including through a tip pool.
Does Illinois tax tips?
Illinois taxes tips as income at its flat state rate. I could not confirm whether Illinois has adopted a deduction like the federal 2025 tips deduction, so check the Illinois Department of Revenue.
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