Short answer: In Maryland, employers can pay tipped workers a cash wage of $3.63 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 $11.37 an hour.
Maryland tipped wage at a glance
| Maryland | |
|---|---|
| Minimum wage | $15.00 an hour |
| Cash wage for tipped workers | $3.63 an hour |
| Maximum tip credit | $11.37 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 2024 |
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 $3.63 = $108.90 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 $341.10. If they make less in tips that week, the employer must pay the difference.
Local rates and exceptions
Montgomery County from 1 Jul 2026: $18.00 (51+ employees), $16.50 (11 to 50), $15.95 (10 or fewer); tipped cash wage $4.00. Howard County also has a higher local rate.
Tip pools and who keeps the tips
I could not find a Maryland tip pool rule on the Department of Labor pages, so the federal rule applies: managers and supervisors cannot take part, and kitchen staff can only share if your employer takes no tip credit.
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
Federal law says tips belong to you. Maryland also bars your employer from making you pay for a customer's unpaid food or drink bill if the customer leaves without paying, whether by payment or a deduction from your wages.
Can card fees come out of tips?
No Maryland rule found, so the federal position applies: an employer may subtract only the card company's actual percentage fee from a card tip.
Income tax on tips in Maryland
Yes, Maryland taxes tips as income. The 2025 Maryland resident return starts from your federal adjusted gross income and I found no Maryland subtraction for tips in it, so the federal tips deduction does not reduce your Maryland tax. I could not confirm any 2026 change.
Other rules
- If you work in Montgomery County the tipped cash wage is higher, $4.00 from 1 July 2026.
- Overtime is 1.5 times the full minimum wage minus the tip credit after 40 hours a week.
The agency in charge is the Maryland Department of Labor, Division of Labor and Industry.
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)
- Montgomery County MD minimum wage
- Maryland Minimum Wage and Overtime Law (poster)
- Montgomery County Minimum Wage and Overtime Law (poster)
- Prince George's County Minimum Wage and Overtime Law (poster)
- Howard County Minimum Wage and Overtime Law (poster)
- Notice to Tipped Employees
- Tip Credit Wage Statement FAQs
- Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act
- 2025 Maryland Resident Income Tax Booklet
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 Maryland in 2026?
In Maryland, employers can pay tipped workers a cash wage of $3.63 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 $11.37 an hour.
Does Maryland allow a tip credit?
Yes. Employers can count up to $11.37 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.
Can my employer take card fees out of my tips in Maryland?
No Maryland rule found, so the federal position applies: an employer may subtract only the card company's actual percentage fee from a card tip.
Does Maryland tax tips?
Yes, Maryland taxes tips as income. The 2025 Maryland resident return starts from your federal adjusted gross income and I found no Maryland subtraction for tips in it, so the federal tips deduction does not reduce your Maryland tax. I could not confirm any 2026 change.
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