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Started By
Message
re: Taxation of TIPS
Posted on 10/31/22 at 3:42 pm to Drizzt
Posted on 10/31/22 at 3:42 pm to Drizzt
It's your line of thinking that is one of the reasons our tax rates are so high in this country, and I'm not just talking about income tax rates. We pay sales taxes, property taxes, estate taxes, excise taxes, etc. etc.
Start paying your fair share.
Start paying your fair share.
0
Posted on 10/31/22 at 7:38 pm to cfotiger
quote:
guess no form of compensation should be taxable, based on that profound statement.
Correct.
Didn’t think it was that hot of a take.
Property tax=sure
Consumption tax=sure
Income tax=no
Posted on 10/31/22 at 8:44 pm to Tiger Prawn
quote:God bless those people if they can avoid paying as much in taxes. We should all be for everyone paying a little as possible. Don't be jealous mate
Not reporting your cash income to avoid taxes on it is immoral and unethical.
A ton of service industry employees make a significant portion (if not a majority) of their income. Why should they not be taxed on it? Restaurant servers, bartenders, valets, food delivery drivers, street performers, nail salons, hair stylists...all make a big chunk of their income off tips.
If people in those fields are under reporting their tips, not only are they avoiding paying the taxes on it but they're probably qualifying for things like medicaid, section 8, or food stamps that they wouldn't have qualified for if they were reporting their income accurately.
Posted on 11/1/22 at 11:33 am to makersmark1
quote:
I would say taxation of income is ludicrous.
All tax should be consumption based.
Income is hard to track for pimps, drug dealers, etc.
Point of sale tax allows the freedom to decide what is worth paying tax for.
Been saying this for years... And it is almost impossible to get people on board with it. Shocking how tied people are to a regressive and flawed system. It's the only way to truly scale taxes with a commensurate level of income and have a taxation method that is free of loopholes.
Posted on 11/1/22 at 9:15 pm to InCaliForNow
The title has soooo much potential!!!!
Posted on 11/2/22 at 6:28 am to InCaliForNow
Most servers etc are liberal AF.
They are all about taxing you and me.
Damn straight they should get audited re tips.
They are all about taxing you and me.
Damn straight they should get audited re tips.
Posted on 11/2/22 at 9:47 am to InCaliForNow
What do you need to know?
Tips are considered income, like wages, etc. Which IS different than a service charge for a party of8 or more, etc.. Tips are income to the server. A service fee, auto grat, etc.. is a fee charged by the institution, who then owns the money. Tips are taxable to the individual.. A charged gratuity is taxable to the institution.. it is a fee.
Traditionally, tips were paid in cash, and like most cash business, off books. Restaurants countered by paying tipped employees practically nothing, and declared tips counted to meet minimum wage requirements.
Still, people could hide cash, until credit card tips became a trackable thing, which, was not that long ago.
NOW, the IRS can estimate, from credit card tips, a % of sales as income to the server, etc., minus tip-out to the bartender, hostess, busser, which will likely total about 3%. So, a 15% tip is really 12%. There are people who do not tip... If that is you, you suck, so the industry has settled on 2 numbers... First, 2.13/hr plus reported tips must meet min wage, or the company must cover the difference.. The total income from tips is estimated to be 8%.
Some companies have begun holding CC tips, taking the tax out, and putting the tip on the check..
Any other questions?
Tips are considered income, like wages, etc. Which IS different than a service charge for a party of8 or more, etc.. Tips are income to the server. A service fee, auto grat, etc.. is a fee charged by the institution, who then owns the money. Tips are taxable to the individual.. A charged gratuity is taxable to the institution.. it is a fee.
Traditionally, tips were paid in cash, and like most cash business, off books. Restaurants countered by paying tipped employees practically nothing, and declared tips counted to meet minimum wage requirements.
Still, people could hide cash, until credit card tips became a trackable thing, which, was not that long ago.
NOW, the IRS can estimate, from credit card tips, a % of sales as income to the server, etc., minus tip-out to the bartender, hostess, busser, which will likely total about 3%. So, a 15% tip is really 12%. There are people who do not tip... If that is you, you suck, so the industry has settled on 2 numbers... First, 2.13/hr plus reported tips must meet min wage, or the company must cover the difference.. The total income from tips is estimated to be 8%.
Some companies have begun holding CC tips, taking the tax out, and putting the tip on the check..
Any other questions?
Posted on 11/2/22 at 9:50 am to Privateer 2007
you are sad person..
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