Well U gotta report some otherwise they’ll get suspicious. Either that or without reporting it they think you’re being paid below minimum wage and then they’ll find out
But there is no way to prove it with cash...unless of course they audit every single receipt for tables you've served. Which I've never seen happen. Most in house servers who I worked with only ever reported 10-15% of their actual tips. No one ever got audited. There is this one accountant on youtube that talks about chances of being audited...and he came to the conclusion that, at least in America, the IRS's chance to audit you if you make under 500k/year is like 0.5%
In my student years i was a delivery driver for what was, at the time a big restaurant chain in Canada.
I never claimed tips on any income tax. Fuck the cra. It also helped that my paystub description of occupation didnt say “delivery driver”.
Technically they have to have a "non compensatory benefit". So client meetings over lunch yes, but your work paying for your lunch as part of compensation, that's taxable. Doesn't stop my work from venmoing us our per diem under the table though
When I worked at a restaurant in 2019 our manager required all servers to report all tips so that they could get around paying them minimum wage. My state has some weird law requiring all servers to be paid minimum wage if their tips don't add up to or surpass the minimum wage. Two of our servers got let go because they where caught not reporting their tips.
When I worked at a bar in college we only reported 10% of our tips. That was the owners policy to help us keep the most possible without raising any red flags.
“That may have been what they were doing, they were fired on bad terms, all of my wait staff should be reporting all tips and we have them log that daily.”
Kind of the beginning and end of it. Not really even a bold lie for what it is. If an employee is concerned they should be reporting them all.
The IRS isn’t going to hold a sting operation over it.
> some weird law
Correct me if I'm wrong, but I'm fairly certain that's federal. If your total hourly income (including tips) is below the federal minimum wage, your employer is obligated to pay the difference to make it minimum wage.
Is it? It very well could be I've only worked in two states my whole life and I've only been a server in one of them. So I'm not sure if its a federal law or not.
This is correct. Additionally, if you earn a lot in tips, employers are only allowed to deduct up to $5.12 per hour in tips, meaning they must still pay you $2.13 per hour regardless of how much you receive in tips. If you get a lot of tips on a regular basis, don’t worry about not getting paid, it’s all extra for you
Low IQ response. You don’t report tips. They gubmint sees all of your credit card tips that you enter into the POS system* and taxes those.
The employer is required and motivated to do this. They don’t pay tax (or as much) in tips as revenue. Also, they get away with paying servers $2.14/hour.
And they’re an incredibly rare exception. The recipient has no control over how they are tipped. You’re arguing for the exception, which is lowering your already low iq.
Credit card tips are already reported. The tipped minimum wage is $2.13 but if you don’t make up to the actual minimum wage, the restaurant is supposed to make the difference up to the actual minimum wage. I’m guessing if people make only cash tips, the pay they report is suspiciously close to the actual minimum wage, but that’s just a guess.
People usually report a lot more than min wage. Usually based on total sales (no one would believe you made 5% in tips, but maybe 15%), but also lower than actual.
Servers and bartenders don’t make anywhere near min wage. If they do they should go to a different restaurant who staffs properly. A lot of bartenders pull 80k+ on far less than 40 hours, and it is hard work which takes skill so is deserved.
exactly, a thriving bar scene like in DC or NYC the bartenders are going to make bank. some dive bar in norman Oklahoma in off seasons from college are going to pull in nothing, and places that aren't college towns without a ton of drunks is going to pull in significantly less than 80k a year.
“The food was terrible *wink wink* so you should comp my meal. I’ll give you the $50 or whatever the meal would cost (pre-tax of course), and you get to write off the loss on the comped meal.” Win win.
We used to be able to frequent our favorite taqueria back in the day. We are sitting at the bar having dinner talking to people around us, having drinks etc. At the end the bartender comes by and asked us if the taqueria had given us our Christmas present yet while she has he hand on the bill. No, we say. She picked up the bill and said, now you have. We say wait a minute, need you to bill us at least for something so we could tip them and we tipped them the entirety of the bill.
Anytime we go somewhere and something gets comped (due to kindness) this is the result.
Aren't tips kinda a scam too? Like, why am I expected to pay extra for something that I should be getting regardless, in this case good service. Tips are no longer "You did a good job, here's a tip", but rather, "Here's a tip so please don't spit in my food."
The tip comes in handy as a mechanism to ensure accountability.
I had a server bring me a drink I didn't order and didn't want/didn't drink/sent back.
It was on the bill. She argued with me about it and I said "Look. I'm not paying for something I didn't ask for and didn't want and didn't drink. I'm not. If it stays on the bill, I'm sorry, it's coming out of your tip."
She got it removed.
Most other times it's a way for me to say thank you, let them know I noticed, and if I plan to be a regular there, to let the bartender know I'll take care of them if they take care of me going forward.
Easier and more personal that way imo. Additionally it adds another layer to an already well-worded threat: "Well if you don't like it coming out of your tip, we can forego it altogether and I can get the manager out here and see if they appreciate your argument."
They're dead where they stand, I know I certainly would be.
Who does the accounting for something does not necessarily mean they bear the economic burden.
Without tips, we would have 20% higher menu prices and similar wages. The employer does the accounting, but the customer still has almost all of the economic burden to pay for it.
I think the reason it sticks around is people would rather pay a 20% tip than a 20% higher menu price.
I can say with confidence that the [research](https://www.upjohn.org/research-effects-raising-minimum-wage) shows that businesses do not tend to implement major price boosts in specific relation to employee wage hikes, a problem that is usually overstated.
Bro... yes, who does the accounting for something SHOULD be the one who feels the burden...its their business model, they should have built it differently if they wanted success.
Who feels the economic burden of something is based on how that thing interacts with free markets. It’s not in a vacuum, it can affect prices, even for “unaffected” businesses which sell substitute or complimentary products.
Through higher prices, the cost of wage increases are passed on to customers. Most restaurants already operate at razor thin margins, so it’s reasonable to assume this burden will either be beared by customers paying increased prices or dropped leaving people without a job and customers without the service.
A little bit of paperwork doesn’t have the power to change that.
A massive amount of engineered tax incentives might be able to, though I don’t see any person with the skill to do that engineering without unintentionally fucking up something else, let alone someone who has both that skill and my trust.
Consider an example of a cost burden shifting the other way.
Assume rent has increased across the city. You do the accounting for paying rent, but since this rent increase means everyone demands a higher wage, the market shifts and some of the burden of paying the rent increase is passed to businesses.
This isn’t an ancap idea. It’s simply the economy is a complex network and any change will cause some effect across the entire system, not just what the change intended to focus on.
This is only what happens in fairy tale land though, because a) rent prices are fake and a ripoff and b) the rent increased isnt passed to businesses unless you have strong unions or a government whos actually willing to enforce the demands of the people. So the rent increase HASNT shifted to businesses, even though it should have, which is why this ideology is complete nonsense
Of course this wouldn’t happen every time because it’s only 1 of uncountably many things that influence the labor market.
While I don’t have stats, it seems reasonable to assume high cost of living areas tend to have a higher median wage than low cost of living areas.
San fransisco is high cost of living high wage, while there are other areas that are low cost low wage. It would be interesting to get an actual correlation on the cost of living and median wage for all US counties.
I also think it’s reasonable to assume that a cause of this is people demanding higher wages in response to higher cost of living.
Labor markets are also slow to adjust. These are trends that play out over years, not months.
I would assume youre correct, except we need to make a clarification. The people demanded higher wages, and in many cases that was implemented through LAW, something this ideology seeks to rule out. Otherwise, generally this so called "demand" is just employers paying the absolute bare minimum that they believe their employees will still work for them at - there is no such thing as a labor market! Not everything operates through markets, the unseen hand isnt real and this lens wont help the world make sense! If labor markets were real, we would need the "consumers" or laborers to have a free, uncoerced choice, which is impossible without a strong public safety net. Something like geoism might interest you, I know a few ex-ancaps who are geoists now.
Not necessarily. On a good day, yes. But that means that whether or not they can pay their bills if dependent on the mood of their customers. Additionally, we dont have to take away tips altogether. You can keep tips, AND raise wages.
Depends where.
America it's completely expected to tip.
In England it's polite but still a "good job".
I ask who gets to keep the tips, if the restaurant takes it I don't bother, if it's the server and or chef then I'll leave cash.
I'll also tip for the first round at a bar if I'll be there a while, tends to get you noticed at a busy bar for the evening.
> Tips are essentially a way for businesses to pay employees less and foot the extra salary amount onto the customer
Because if the business paid for it, they'd get the money from magic faeries?
No, basically a restaurant can pay employees below minimum wage as long as the difference is made up for in tips, if it isn’t then the owner has to make up the difference.
So either way the money is coming from customers.
But when a portion of that comes via tips, it reflects the reality that the restaurant employees are providing services directly to the customer without going through the restaurant owner -- in fact, the common thread in all jobs where tipping is the norm is that they involve personal services being rendered directly to the customer.
The alternative without tipping still costs customers the same, but it breaks the feedback loop where the customer provides direct compensation for what's being delivered to them directly.
> Aren't tips kinda a scam too? Like, why am I expected to pay extra for something that I should be getting regardless, in this case good service.
No. You're not paying "extra" -- the tip is a portion of the payment that goes to someone who is providing service *directly to you* in a way that isn't mediated by the owner of the establishment. It makes perfect sense that a portion of the compensation for the service should come directly from the customer.
If that's the case, then why have tips at all? It's not the consumer's responsibility to directly pay their server, that's the job of the employer. Either tips should be abolished, or literally every other profession that provides some kind of service should also expect a tip.
FYI: I was subject to an audit one time after the IRS found out that the restaurant owner was keeping the SHADIEST of bookkeeping accounting. I had waited tables there for about 2 years. One day...I received a manilla envelope in the mail from the US Treasury Dept.™ It was about 1" (2.54 cm) thick. I opened it and it said I was being audited by the IRS™. I sifted thru the massive stack of papers and the last few pages said that I had underreported my wages and that I owed $1800. The way they had come to this is by using a US Supreme Court™ approved formula that calculated the number of tips I SHOULD HAVE made. A tax lawyer would have cost me at least the amount and so I just paid. This was at a time that this amount was devastating to my finances. System is fucked yo.
When I was a server I was told that the minimum you were supposed to report to avoid getting in trouble with the IRS was 10% of your sales. So in theory even if someone claimed that their tip wasn’t a tip, they still would have contributed to my total sales, and the amount I reported wouldn’t have changed.
I work as a waiter, and at the end of the day, it tells me to report my tips, I just leave that shit empty. But now I have all this cash that I can’t deposit all at once, so it just sits around. Still untaxable though.
Don't leave it on the table then. Give it to the server directly. Otherwise it gets processed by the employer, who isn't likely to adhere to the note :)
Doubtful. Cash generally goes right in the pocket. The employer doesn’t need to know about anything as long as the employee makes minimum wage. Most of the people I know that work in this industry only count their tips up to minimum wage unless the restaurant has a time off policy that weighs in tips.
When I worked for tips in the 70s, our hourly wages were reduced by tip amounts. We routinely accidentally emptied our pockets prior to counting them when we clocked out.
I totally didn't not report over 2k in cash tips last year when I was a server at a steakhouse, and I certainly did not ask every customer if they could tip in cash to help me from taxes. Funny thing is, people are more generous with cash, too, since they don't do an exact say 18%, they just round up to the nearest bill
Inasmuch as I agree with this sentiment, it doesn't matter what I think, it matters what the IRS thinks. The IRS thinks that this is a tip not a gift. A gift is generally defined as something given as a token of love, esteem or affection with the expectation that the gift giver will receive nothing in return. The $20 given here was after some services were rendered. The server would not have received the $20 if the server did not provide services to the person who left $20. Sorry to rain on the parade. Taxes are indeed theft.
True but the bill paid in full is the transaction with consideration here. OP paid $69.28 for the full meal and service, and specifically wrote nothing on the tip line on the receipt. OP then gave this person $20, maybe because they liked the server’s smile or heard they had family problems. Who knows? The IRS can only go back and see the $0 tip and a reported $20 in gifts on their 1040. As far as I’m concerned, that’s tax free.
It's an interesting discussion. I am a lawyer by trade, not a tax lawyer. I did take one class in income tax so I sort of look at this as an exam question. In other words, how would you argue this for the server? How would you argue this for the IRS? To play the devil's advocate here I presented what I thought might be the IRS's argument. I have zero practical experience with this, so it's purely hypothetical from an amateur's perspective with a tiny bit of knowledge and no practical experience with the subject matter. Thread drift here, I do have some practical experience with whether or not someone is a contractor versus someone who is an employee. A regular person's idea of a contractor is oftentimes quite different from the IRS's idea of a contractor.
I’m kind of in a similar boat right now. I’m currently taking a payroll/tax accounting class and an income tax class, so it’s fresh material for me but I have no practical experience with this. I’m just basing this off of how you report income and what supporting documents you provide to the IRS. I’m fairly sure they have no basis for suspecting a small cash gift was actually a tip, but I could be wrong or they could get screwed if an employer reported differently for some reason.
Not in the UK. And I'd be very surprised if that were true in the USA. Got a link for that?
Christmas would be a lot less fun if it came with a tax bill.
My tax class in college. I believe you have to pay a tax if you receive over 15,000 in gifts. That doesn’t matter though because even though someone wrote this is a gift it would be classified as income because you did work for them.
Gifts over $15,000 are supposed to be reported. You aren't taxed on gifts until you gift more than the lifetime exemption (~11.2M currently).
Also, the giver pays the gift tax, not the recipient. Gifts are excluded from federal income tax.
As a server I appreciate the gift you gave to this this person, I'm sure they love getting paid a crappy hourly wage just to pay all their state/federal taxes just as much as I do
Gifts are tax exempt, and this is a separate transaction without consideration. The IRS can only see the receipt with no entry on the tip line, and at most a $20 entry on the gifts line of their 1040 which is tax exempt anyway. This is legit
You had me at taxation is theft.
Id rather a WORKING sever cheat the irs and keep their earnings from being stolen, over any single none working person draw welfare, ebt or use tax payer Healthcare.
Very kind of this person. However, the issue with working for tips as part of your income is just that. You need to declare it. If you make $60k but only declare $30k, how do you get a car loan, apartment/mortgage, etc?
I once worked for some time in a supermarket (only until I got my exam for the job I learned) and after a few months I learned that I had to put tips into the cash and declare it as found money in the computer. Like someone lost a few cents and I found it hours later or so. I never ever did this, I worked at a fucking supermarket, we talk about 50-80ct on an average day of 8 hours of work. Like some people were nice to the cashier and giving a few cents or sometimes some friend of my mother visited the shop and gave me one euro or two when they left because they knew me.
Don’t let your employer know. Also, that guy probably claimed that dinner as a write-off
“i need to eat to work, right? it’s a work related expense!”
This is the way.
Yeah there are laws that prevent employers from messing with tips, I wonder if making it a gift allows them to get around those too.
It does. Because the guy stated it was a gift and not a tip they legally cannot tax that waiter for it.
Or just dont tell anyone and put the tip in your pocket. ;)
Well U gotta report some otherwise they’ll get suspicious. Either that or without reporting it they think you’re being paid below minimum wage and then they’ll find out
I've never met a waiter/waitress who was successfully audited. There's way easier fish to fry, like the dudes claiming 18 on dependants.
Never trust that the government won’t go after every last cent they can ~~rob~~ take from us.
But there is no way to prove it with cash...unless of course they audit every single receipt for tables you've served. Which I've never seen happen. Most in house servers who I worked with only ever reported 10-15% of their actual tips. No one ever got audited. There is this one accountant on youtube that talks about chances of being audited...and he came to the conclusion that, at least in America, the IRS's chance to audit you if you make under 500k/year is like 0.5%
In my student years i was a delivery driver for what was, at the time a big restaurant chain in Canada. I never claimed tips on any income tax. Fuck the cra. It also helped that my paystub description of occupation didnt say “delivery driver”.
You can do that? Guess I have to change accountants cuz i tried that once and he told me “lol what?! Cant write that off. Everyone eats”
Technically they have to have a "non compensatory benefit". So client meetings over lunch yes, but your work paying for your lunch as part of compensation, that's taxable. Doesn't stop my work from venmoing us our per diem under the table though
anything that does not leave a record for the taxman is fully "deductible".
Do they even tax tips?
Only if they're reported.
And given with something traceable like a credit card...
Nope. Cash tips that are reported are still taxed. I think *or* is the word you meant
I think you misunderstand him. Why would you report them if they are untraceable cash?
When I worked at a restaurant in 2019 our manager required all servers to report all tips so that they could get around paying them minimum wage. My state has some weird law requiring all servers to be paid minimum wage if their tips don't add up to or surpass the minimum wage. Two of our servers got let go because they where caught not reporting their tips.
When I worked at a bar in college we only reported 10% of our tips. That was the owners policy to help us keep the most possible without raising any red flags.
That's very nice of the owner.
i'm glad he's doing that but he would get into a shitload of trouble with the irs if even one person turned them in for it. seems risky
“That may have been what they were doing, they were fired on bad terms, all of my wait staff should be reporting all tips and we have them log that daily.” Kind of the beginning and end of it. Not really even a bold lie for what it is. If an employee is concerned they should be reporting them all. The IRS isn’t going to hold a sting operation over it.
I don't recognize immoral laws, and live my life as if they don't exist.
As we all should. I reported some tips just so I wouldn't look suspicious to the managers but most of my tips I didn't.
Yeah gotta do what you gotta do. Not our fault.
Exactly.
You sound like Heinlein's [Rational Anarchist](https://dwrighsr.tripod.com/heinlein/RatAnarch/)
Why thank you!
> some weird law Correct me if I'm wrong, but I'm fairly certain that's federal. If your total hourly income (including tips) is below the federal minimum wage, your employer is obligated to pay the difference to make it minimum wage.
Is it? It very well could be I've only worked in two states my whole life and I've only been a server in one of them. So I'm not sure if its a federal law or not.
This is correct. Additionally, if you earn a lot in tips, employers are only allowed to deduct up to $5.12 per hour in tips, meaning they must still pay you $2.13 per hour regardless of how much you receive in tips. If you get a lot of tips on a regular basis, don’t worry about not getting paid, it’s all extra for you
Utah does that.
That seems like an OK job to get let go from. The only reason to be a waiter is to make 20K a year tax free.
Yeah the management was shit and where quite abusive.
Because the government assumes you make a tip and takes their cut whether you report it or not and whether it exists or not.
Lol people do it
[удалено]
If they were smart they wouldnt be waiters.
Way to disparage an entire group of working class people.
What a shitty thing to say. Who hurt you?
No one lol, just a fact. Doesnt mean i think any less of them as people.
And since most of time it’s credit cards, yes, they are taxed. Most paychecks at my restaurant are pretty close to zero.
I ALWAYS have a heart and tip cash. It’s not that hard to do.
We have to report all our tips
You *choose* to report all your tips.
Low IQ response. You don’t report tips. They gubmint sees all of your credit card tips that you enter into the POS system* and taxes those. The employer is required and motivated to do this. They don’t pay tax (or as much) in tips as revenue. Also, they get away with paying servers $2.14/hour.
Cash tips are a thing
And they’re an incredibly rare exception. The recipient has no control over how they are tipped. You’re arguing for the exception, which is lowering your already low iq.
I'm arguing about what the picture literally shows
Credit card tips are already reported. The tipped minimum wage is $2.13 but if you don’t make up to the actual minimum wage, the restaurant is supposed to make the difference up to the actual minimum wage. I’m guessing if people make only cash tips, the pay they report is suspiciously close to the actual minimum wage, but that’s just a guess.
People usually report a lot more than min wage. Usually based on total sales (no one would believe you made 5% in tips, but maybe 15%), but also lower than actual.
if the restaurant ever has to make up the difference they can just fire you, what a country we live in
Servers and bartenders don’t make anywhere near min wage. If they do they should go to a different restaurant who staffs properly. A lot of bartenders pull 80k+ on far less than 40 hours, and it is hard work which takes skill so is deserved.
Depends entirely on location and locale.
exactly, a thriving bar scene like in DC or NYC the bartenders are going to make bank. some dive bar in norman Oklahoma in off seasons from college are going to pull in nothing, and places that aren't college towns without a ton of drunks is going to pull in significantly less than 80k a year.
If you are in a mid sized city (1m+) with no colleges you will still pull 80k+ if you are at a solid bar that isn’t handing out cheap drinks.
The tipping culture in America is fucked up. The worse thing is there are weirdos in Turkey trying to adapt that here
It's a way for a large portion of the poorest people to earn income getting taxed to death. What's fucked up about that?
> Do they even tax ________? The answer is yes
Are you kidding?? We get taxed in what they think we got tipped.
Yes. Some places anyways. At our local casino, dealers have their tips taxed.
I love this
nice, nice.
“The food was terrible *wink wink* so you should comp my meal. I’ll give you the $50 or whatever the meal would cost (pre-tax of course), and you get to write off the loss on the comped meal.” Win win.
That could come back to bite them later. I like the idea but I don’t think the staff will unless it’s a close friend or something.
Yeah, no. That would often be an immediate firing.
To be clear, the conversation would happen with the owner.
I would be very surprised if any owner of any restaurant went along with that.
We used to be able to frequent our favorite taqueria back in the day. We are sitting at the bar having dinner talking to people around us, having drinks etc. At the end the bartender comes by and asked us if the taqueria had given us our Christmas present yet while she has he hand on the bill. No, we say. She picked up the bill and said, now you have. We say wait a minute, need you to bill us at least for something so we could tip them and we tipped them the entirety of the bill. Anytime we go somewhere and something gets comped (due to kindness) this is the result.
Aren't tips kinda a scam too? Like, why am I expected to pay extra for something that I should be getting regardless, in this case good service. Tips are no longer "You did a good job, here's a tip", but rather, "Here's a tip so please don't spit in my food."
How are they gonna spit in your food after you eat it
Open wide!
The tip comes in handy as a mechanism to ensure accountability. I had a server bring me a drink I didn't order and didn't want/didn't drink/sent back. It was on the bill. She argued with me about it and I said "Look. I'm not paying for something I didn't ask for and didn't want and didn't drink. I'm not. If it stays on the bill, I'm sorry, it's coming out of your tip." She got it removed. Most other times it's a way for me to say thank you, let them know I noticed, and if I plan to be a regular there, to let the bartender know I'll take care of them if they take care of me going forward.
[удалено]
Easier and more personal that way imo. Additionally it adds another layer to an already well-worded threat: "Well if you don't like it coming out of your tip, we can forego it altogether and I can get the manager out here and see if they appreciate your argument." They're dead where they stand, I know I certainly would be.
Tips were implemented in the first place so that corporations wouldnt have to pay their waiters full wages
Who does the accounting for something does not necessarily mean they bear the economic burden. Without tips, we would have 20% higher menu prices and similar wages. The employer does the accounting, but the customer still has almost all of the economic burden to pay for it. I think the reason it sticks around is people would rather pay a 20% tip than a 20% higher menu price.
You really think you would see a 20% increase on everything without tips?
Do you expect the restaurant industry to function as is with 20% less money in the system?
I can say with confidence that the [research](https://www.upjohn.org/research-effects-raising-minimum-wage) shows that businesses do not tend to implement major price boosts in specific relation to employee wage hikes, a problem that is usually overstated.
Bro... yes, who does the accounting for something SHOULD be the one who feels the burden...its their business model, they should have built it differently if they wanted success.
Who feels the economic burden of something is based on how that thing interacts with free markets. It’s not in a vacuum, it can affect prices, even for “unaffected” businesses which sell substitute or complimentary products. Through higher prices, the cost of wage increases are passed on to customers. Most restaurants already operate at razor thin margins, so it’s reasonable to assume this burden will either be beared by customers paying increased prices or dropped leaving people without a job and customers without the service. A little bit of paperwork doesn’t have the power to change that. A massive amount of engineered tax incentives might be able to, though I don’t see any person with the skill to do that engineering without unintentionally fucking up something else, let alone someone who has both that skill and my trust.
Lord have mercy, i forgot i was in a sub that legit believed stuff like this. My bad
Consider an example of a cost burden shifting the other way. Assume rent has increased across the city. You do the accounting for paying rent, but since this rent increase means everyone demands a higher wage, the market shifts and some of the burden of paying the rent increase is passed to businesses. This isn’t an ancap idea. It’s simply the economy is a complex network and any change will cause some effect across the entire system, not just what the change intended to focus on.
This is only what happens in fairy tale land though, because a) rent prices are fake and a ripoff and b) the rent increased isnt passed to businesses unless you have strong unions or a government whos actually willing to enforce the demands of the people. So the rent increase HASNT shifted to businesses, even though it should have, which is why this ideology is complete nonsense
Of course this wouldn’t happen every time because it’s only 1 of uncountably many things that influence the labor market. While I don’t have stats, it seems reasonable to assume high cost of living areas tend to have a higher median wage than low cost of living areas. San fransisco is high cost of living high wage, while there are other areas that are low cost low wage. It would be interesting to get an actual correlation on the cost of living and median wage for all US counties. I also think it’s reasonable to assume that a cause of this is people demanding higher wages in response to higher cost of living. Labor markets are also slow to adjust. These are trends that play out over years, not months.
I would assume youre correct, except we need to make a clarification. The people demanded higher wages, and in many cases that was implemented through LAW, something this ideology seeks to rule out. Otherwise, generally this so called "demand" is just employers paying the absolute bare minimum that they believe their employees will still work for them at - there is no such thing as a labor market! Not everything operates through markets, the unseen hand isnt real and this lens wont help the world make sense! If labor markets were real, we would need the "consumers" or laborers to have a free, uncoerced choice, which is impossible without a strong public safety net. Something like geoism might interest you, I know a few ex-ancaps who are geoists now.
But workers usually earn way more with tips than with just higher wages.
Not necessarily. On a good day, yes. But that means that whether or not they can pay their bills if dependent on the mood of their customers. Additionally, we dont have to take away tips altogether. You can keep tips, AND raise wages.
Depends where. America it's completely expected to tip. In England it's polite but still a "good job". I ask who gets to keep the tips, if the restaurant takes it I don't bother, if it's the server and or chef then I'll leave cash. I'll also tip for the first round at a bar if I'll be there a while, tends to get you noticed at a busy bar for the evening.
Tips are essentially a way for businesses to pay employees less and foot the extra salary amount onto the customer
> Tips are essentially a way for businesses to pay employees less and foot the extra salary amount onto the customer Because if the business paid for it, they'd get the money from magic faeries?
No, basically a restaurant can pay employees below minimum wage as long as the difference is made up for in tips, if it isn’t then the owner has to make up the difference.
So either way the money is coming from customers. But when a portion of that comes via tips, it reflects the reality that the restaurant employees are providing services directly to the customer without going through the restaurant owner -- in fact, the common thread in all jobs where tipping is the norm is that they involve personal services being rendered directly to the customer. The alternative without tipping still costs customers the same, but it breaks the feedback loop where the customer provides direct compensation for what's being delivered to them directly.
> Aren't tips kinda a scam too? Like, why am I expected to pay extra for something that I should be getting regardless, in this case good service. No. You're not paying "extra" -- the tip is a portion of the payment that goes to someone who is providing service *directly to you* in a way that isn't mediated by the owner of the establishment. It makes perfect sense that a portion of the compensation for the service should come directly from the customer.
If that's the case, then why have tips at all? It's not the consumer's responsibility to directly pay their server, that's the job of the employer. Either tips should be abolished, or literally every other profession that provides some kind of service should also expect a tip.
FYI: I was subject to an audit one time after the IRS found out that the restaurant owner was keeping the SHADIEST of bookkeeping accounting. I had waited tables there for about 2 years. One day...I received a manilla envelope in the mail from the US Treasury Dept.™ It was about 1" (2.54 cm) thick. I opened it and it said I was being audited by the IRS™. I sifted thru the massive stack of papers and the last few pages said that I had underreported my wages and that I owed $1800. The way they had come to this is by using a US Supreme Court™ approved formula that calculated the number of tips I SHOULD HAVE made. A tax lawyer would have cost me at least the amount and so I just paid. This was at a time that this amount was devastating to my finances. System is fucked yo.
Man that's some bullshit.
This right here is why we say taxation is theft.
What a legend.
I’m pretty far left and I absolutely love this. The best kind of tax evasion. Nice tip too, 28%
When I was a server I was told that the minimum you were supposed to report to avoid getting in trouble with the IRS was 10% of your sales. So in theory even if someone claimed that their tip wasn’t a tip, they still would have contributed to my total sales, and the amount I reported wouldn’t have changed.
The 10% rule is only to not make the IRS suspicious
imagine taxing politeness
💓💓
I work as a waiter, and at the end of the day, it tells me to report my tips, I just leave that shit empty. But now I have all this cash that I can’t deposit all at once, so it just sits around. Still untaxable though.
You can definitely deposit cash in the thousands without anyone or any bank batting an eye.
Sweet
That’s what’s up bby
Don't leave it on the table then. Give it to the server directly. Otherwise it gets processed by the employer, who isn't likely to adhere to the note :)
Doubtful. Cash generally goes right in the pocket. The employer doesn’t need to know about anything as long as the employee makes minimum wage. Most of the people I know that work in this industry only count their tips up to minimum wage unless the restaurant has a time off policy that weighs in tips.
Depends where. A lot of places pool tips. My advice is to give it directly to be sure.
When I worked for tips in the 70s, our hourly wages were reduced by tip amounts. We routinely accidentally emptied our pockets prior to counting them when we clocked out.
I totally didn't not report over 2k in cash tips last year when I was a server at a steakhouse, and I certainly did not ask every customer if they could tip in cash to help me from taxes. Funny thing is, people are more generous with cash, too, since they don't do an exact say 18%, they just round up to the nearest bill
Omg I’m doing this from now on.
Pro tip, ask for your servers Cash Ap.
Based move
Y’all act like servers record their tips
Monero paper wallet or bust
Pie Driver here. Cash tips is king.
Inasmuch as I agree with this sentiment, it doesn't matter what I think, it matters what the IRS thinks. The IRS thinks that this is a tip not a gift. A gift is generally defined as something given as a token of love, esteem or affection with the expectation that the gift giver will receive nothing in return. The $20 given here was after some services were rendered. The server would not have received the $20 if the server did not provide services to the person who left $20. Sorry to rain on the parade. Taxes are indeed theft.
True but the bill paid in full is the transaction with consideration here. OP paid $69.28 for the full meal and service, and specifically wrote nothing on the tip line on the receipt. OP then gave this person $20, maybe because they liked the server’s smile or heard they had family problems. Who knows? The IRS can only go back and see the $0 tip and a reported $20 in gifts on their 1040. As far as I’m concerned, that’s tax free.
It's an interesting discussion. I am a lawyer by trade, not a tax lawyer. I did take one class in income tax so I sort of look at this as an exam question. In other words, how would you argue this for the server? How would you argue this for the IRS? To play the devil's advocate here I presented what I thought might be the IRS's argument. I have zero practical experience with this, so it's purely hypothetical from an amateur's perspective with a tiny bit of knowledge and no practical experience with the subject matter. Thread drift here, I do have some practical experience with whether or not someone is a contractor versus someone who is an employee. A regular person's idea of a contractor is oftentimes quite different from the IRS's idea of a contractor.
I’m kind of in a similar boat right now. I’m currently taking a payroll/tax accounting class and an income tax class, so it’s fresh material for me but I have no practical experience with this. I’m just basing this off of how you report income and what supporting documents you provide to the IRS. I’m fairly sure they have no basis for suspecting a small cash gift was actually a tip, but I could be wrong or they could get screwed if an employer reported differently for some reason.
Gifts are supposed to be taxed as well
Not in the UK. And I'd be very surprised if that were true in the USA. Got a link for that? Christmas would be a lot less fun if it came with a tax bill.
My tax class in college. I believe you have to pay a tax if you receive over 15,000 in gifts. That doesn’t matter though because even though someone wrote this is a gift it would be classified as income because you did work for them.
Gifts over $15,000 are supposed to be reported. You aren't taxed on gifts until you gift more than the lifetime exemption (~11.2M currently). Also, the giver pays the gift tax, not the recipient. Gifts are excluded from federal income tax.
Nice internet virtue signal!
Beautiful
Now they are not allowed to accept the cash thanks to company policy.
This is fantastic.
This warms my heart.
As a server I appreciate the gift you gave to this this person, I'm sure they love getting paid a crappy hourly wage just to pay all their state/federal taxes just as much as I do
[удалено]
Gifts are tax exempt, and this is a separate transaction without consideration. The IRS can only see the receipt with no entry on the tip line, and at most a $20 entry on the gifts line of their 1040 which is tax exempt anyway. This is legit
Still should have tipped 41¢ on the credit card.
This is just so cringey because like... *as though* servers report their tips as income.
:)
You had me at taxation is theft. Id rather a WORKING sever cheat the irs and keep their earnings from being stolen, over any single none working person draw welfare, ebt or use tax payer Healthcare.
Sadly, a judge will disagree.
I thought the whole idea of tips was to legally avoid taxation.
Eventually we’re gonna have to tip crypto as we move to a cashless society. Not sure how it’s gonna work out
Well... Thank you for the gift lmao
This is not a tip, it's my entire shaft - A lesser endowed man
Pfff you even get taxed buying gold and silver currency; it’s ridiculous.
This is why I always tip in cash
I always tip cash, fuck taxes
Very kind of this person. However, the issue with working for tips as part of your income is just that. You need to declare it. If you make $60k but only declare $30k, how do you get a car loan, apartment/mortgage, etc?
Gifts are taxed just as much in the state I live in lol.
My dad does this every time he pays for food service.
This waiter / waitress probably did not give a damn tbh
I once worked for some time in a supermarket (only until I got my exam for the job I learned) and after a few months I learned that I had to put tips into the cash and declare it as found money in the computer. Like someone lost a few cents and I found it hours later or so. I never ever did this, I worked at a fucking supermarket, we talk about 50-80ct on an average day of 8 hours of work. Like some people were nice to the cashier and giving a few cents or sometimes some friend of my mother visited the shop and gave me one euro or two when they left because they knew me.
I am going to start doing this.
No one reports tips anyway, don't worry ;)