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Started By
Message
re: No tax on tips could be a huge loophole
Posted on 8/13/24 at 7:45 am to chity
Posted on 8/13/24 at 7:45 am to chity
quote:
No tax on tips could be a huge loophole
Not worried about the loophole as much as it being bullshite.
I know some "servers" who make well in the high 5s maybe even low 6 figures.
Why do I pay 10s of thousands in taxes and they will pay nearly nothing after this. *not that they do right now
1
Posted on 8/13/24 at 8:47 am to chity
quote:
What is stopping any employer
Treasury Regs which:
1. Limit types of employers to which rule applies to those industries/jobs where tips constitute a significant portion of employees' compensation (restaurant, hospitality, exotic dancer, etc.)
2. Set a cap on amounts of income that can be classified as tips
3. Require the tip income to come directly from customers, not the employer
Etc.
Posted on 8/13/24 at 8:51 am to chity
quote:
What is stopping any employer from paying his/her employees minimum wage and then labeling the rest of their salary a tip?
With a tip there is the employee, employer and the tipper.
Posted on 8/13/24 at 9:00 am to chity
quote:
What is stopping any employer from paying his/her employees minimum wage and then labeling the rest of their salary a tip?
I'm co-owner of a small retail store that accepts tips for the staff. I wasn't sure about this when we started it, but its the standard "ok now the screen is going to ask you some questions". We pay $15/hr or so, and the staff makes another $5-10/hr on tips.
Perhaps we could lower prices in the store, bringing in more customers, and have a mandatory tip included as a line item at the register? Not sure.
This post was edited on 8/13/24 at 9:58 am
Posted on 8/13/24 at 9:49 am to chity
They will regulate this.
But in industries that traditionally have a lot of tips, you are going to see all companies lower down to the tip minimum wage of $2.13/hr and the push to tip is going to become even more part of life.
This is why both sides like this.
The left like it because most of the tipped employees are left.
The right likes it because they think this can save business owners wage dollars and payroll tax.
But in industries that traditionally have a lot of tips, you are going to see all companies lower down to the tip minimum wage of $2.13/hr and the push to tip is going to become even more part of life.
This is why both sides like this.
The left like it because most of the tipped employees are left.
The right likes it because they think this can save business owners wage dollars and payroll tax.
Posted on 8/13/24 at 9:04 pm to chity
Some waiters at high end restaurants can make 6 figures and it’s 99% tips!
Posted on 8/14/24 at 12:11 am to Lsut81
quote:
Why do I pay 10s of thousands in taxes and they will pay nearly nothing after this
1000%. This means less taxes paid by tipped employees, for most servers/bartenders that's the majority of their income. Which means more taxes will have to be paid by the non-tipping population.
Posted on 8/14/24 at 7:54 am to Big_Sur
quote:
I'm co-owner of a small retail store that accepts tips for the staff. I wasn't sure about this when we started it, but its the standard "ok now the screen is going to ask you some questions". We pay $15/hr or so, and the staff makes another $5-10/hr on tips.
My wife’s granddaughter works in a similar establishment. While she doesn’t receive tips directly from customers, customers do tip. And the business splits the overall tips between the employees. Really though, the tips are coming from customers, not really the business. So I suppose that’s within the rules. Whereas in a business that doesn’t typically receive tips, if they were to “reclassify” what had been W2 income as tip income, a giant red flag would shoot to the sky.
Posted on 8/14/24 at 1:49 pm to CharlesUFarley
quote:
For instance, a restaurant could not make a waitress bus or wash dishes, because those were non-tip services and amounted to forcing a waitress to work at below minimum wage.
We currently have the 80/20 rule where only 20% of a workload can be duties that support tip earning duties (i.e. setting up a wait station) I've got girls making $40k on a part time job. This would be a big step for them
Posted on 8/14/24 at 5:04 pm to chity
quote:
What is stopping any employer from paying his/her employees minimum wage and then labeling the rest of their salary a tip?
There’s a billion problems with this concept. I don’t even see how it’s beneficial for say the average restaurant server. I personally don’t see this as beneficial to anyone.
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