No tax on tips

8,616 Views | 106 Replies | Last: 5 mo ago by VegasAg86
Old Army Ghost
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Space-Tech said:

Funky Winkerbean said:

Space-Tech said:

How about they federally require businesses to pay workers a decent living wage. If your business model requires the exploitation of employees, then you shouldn't be in business.
How are they being exploited if they chose to work there?
Well person is pretty desperate if they can't find work, so they'll take anything they can get. They get sucked into a minimum wage job that barely allows them to live. They work 9-10 hours every day just survive, and some employers take advantage of thier situation. Want them to come in 15-30 minutes early to "prep" for their shift before they start getting paid, or "forget" to properly log overtime, or deny raises "because we've all struggled this year" never mind the boss's brand-new F-250 Lariat because the Raptor just could haul the new boat.
did you fail econ 101

how many restaurants do you run and what is your labor cost
Old Army has gone to hell.
MemphisAg1
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AG
Space-Tech said:

How about they federally require businesses to pay workers a decent living wage. If your business model requires the exploitation of employees, then you shouldn't be in business.
Lol, how about they develop the skills to earn a living wage? Start at the bottom and work your way up, one step at a time, like everybody else. Don't like that job or the pay? Then go find another, preferably one where you can develop over time and move up.

Life ain't fair or easy. It's not the government's job to play sugar daddy.
Old Tom Morris
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The tip model for waiters/waitresses works well. Plays into the quality of service. If you think it doesn't, try visiting countries where tipping these folks is not a thing. Brutal.
agAngeldad
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Old Tom Morris said:

The tip model for waiters/waitresses works well. Plays into the quality of service. If you think it doesn't, try visiting countries where tipping these folks is not a thing. Brutal.


Agree. However, there are plenty of people that are asses and cheap. While the customer expects perfection they tip $2.00 on a $50 meal. Essentially, many waitresses/waiters work for cheap labor during a short leriod of time. Ie college/Hs/ between jobs etc . People should give some grace and tip well or stay home and wait on themselves !!
VegasAg86
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AG
samurai_science said:

itsyourboypookie said:

Trump already knows there is no tax on tips
Credit Card Tips are taxed, and so are cash if they are dumb enough to report them.


The employees report tips to the employers and the employers report them to the IRS. Reported tips of less than 8% of gross sales is a trigger for investigation.
VegasAg86
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AG
Jeeper79 said:

This sounds pretty liberal. A tax cut in name, but a hand out in practice because of extremely targeted nature.


Only in the progressive mind is income the property of the government and letting people keep what they earn a hand out.
Im Gipper
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Conservatives rightfully point out the unjust nature of some people paying no income taxes.

Why in the world would we add millions more to the having "no skin in the game"?


Silly pandering.


Trump tax cuts were great last time, let's do that again bigger & better!

I'm Gipper
Old Tom Morris
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agAngeldad said:

Old Tom Morris said:

The tip model for waiters/waitresses works well. Plays into the quality of service. If you think it doesn't, try visiting countries where tipping these folks is not a thing. Brutal.


Agree. However, there are plenty of people that are asses and cheap. While the customer expects perfection they tip $2.00 on a $50 meal. Essentially, many waitresses/waiters work for cheap labor during a short leriod of time. Ie college/Hs/ between jobs etc . People should give some grace and tip well or stay home and wait on themselves !!


Agree that there are jerks, but it works properly the large majority of the time
techno-ag
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AG
Im Gipper said:

Conservatives rightfully point out the unjust nature of some people paying no income taxes.

Why in the world would we add millions more to the having "no skin in the game"?


Silly pandering.


Trump tax cuts were great last time, let's do that again bigger & better!

Yes, please. Those tax cuts gave us the best economy in an age. Far better than it is now.
Trump will fix it.
Funky Winkerbean
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AG
Now imagine keeping all your income and only getting taxed when you spend it.
BonfireNerd04
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TriAg2010 said:

This would obviously incentivize businesses to shift more employee compensation to tips, which means the price of goods and services would become more opaque. Setting aside whether it's good or bad tax policy, it sounds miserable for consumers.


I agree. American tipping culture is dumb. When tips are such an obligation that leaving a 10% tip is considered an insult or punishment (because it's not the expected 15-20%), you might as well raise the price of the food and expect restaurants to actually pay their waiters instead of guilt-tripping their customers into paying them.
MemphisAg1
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AG
agAngeldad said:

Old Tom Morris said:

The tip model for waiters/waitresses works well. Plays into the quality of service. If you think it doesn't, try visiting countries where tipping these folks is not a thing. Brutal.


Agree. However, there are plenty of people that are asses and cheap. While the customer expects perfection they tip $2.00 on a $50 meal. Essentially, many waitresses/waiters work for cheap labor during a short leriod of time. Ie college/Hs/ between jobs etc . People should give some grace and tip well or stay home and wait on themselves !!
I've started pushing back on "tip creep" and don't care if anybody else likes it or not. You pick up a to-go order and the screen asks if you want to tip. Pick up the dry clean, and they ask if you want to tip. Walk through a coffee line and they ask if you want to tip. If you wait on me, bring drinks and food to the table, then sure, tipping for service is fair game. The better the service the better the tip.

Also tipping percentage expectations keep creeping up and up. I remember roughly 50 years ago when 10% was a standard tip. Then 15%. Then 20%. Now many expect 22%, 25%. Enough!
Old Tom Morris
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To be clear, I specially called out waiters and waitresses. I agree that tip creep is going too far with other jobs, but in situations where effort can directly improve (or ruin) your experience dramatically, like it can with servers, I think the model works well in setting up a meritocracy that incents good service that positively impacts your experience.
BigRobSA
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Funky Winkerbean said:

Now imagine keeping all your income and only getting taxed when you spend it.


Now...






...imagine you're black!
MemphisAg1
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AG
Old Tom Morris said:

To be clear, I specially called out waiters and waitresses. I agree that tip creep is going too far with other jobs, but in situations where effort can directly improve (or ruin) your experience dramatically, like it can with servers, I think the model works well in setting up a meritocracy
Agree. Also very relevant for other service type roles like fishing/hunting guides, for-hire drivers, etc.
richardag
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VegasAg86 said:

samurai_science said:

itsyourboypookie said:

Trump already knows there is no tax on tips
Credit Card Tips are taxed, and so are cash if they are dumb enough to report them.
The employees report tips to the employers and the employers report them to the IRS. Reported tips of less than 8% of gross sales is a trigger for investigation.
I never heard this, could you provide any links or proof?
Among the latter, under pretence of governing they have divided their nations into two classes, wolves and sheep.”
Thomas Jefferson, Letter to Edward Carrington, January 16, 1787
one safe place
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Space-Tech said:

Funky Winkerbean said:

Space-Tech said:

How about they federally require businesses to pay workers a decent living wage. If your business model requires the exploitation of employees, then you shouldn't be in business.
How are they being exploited if they chose to work there?
Well person is pretty desperate if they can't find work, so they'll take anything they can get. They get sucked into a minimum wage job that barely allows them to live. They work 9-10 hours every day just survive, and some employers take advantage of thier situation. Want them to come in 15-30 minutes early to "prep" for their shift before they start getting paid, or "forget" to properly log overtime, or deny raises "because we've all struggled this year" never mind the boss's brand-new F-250 Lariat because the Raptor just could haul the new boat.
If they don't like the way they are being treated, they can take their skill set to another employer. That is what most people would do. The boss is the boss, the boss is taking the risks, hiring the workers, dealing with knotheads, and is entitled to any vehicle or vehicles he or she desires and can pay for. For those that don't like it there are a couple of options:

1. Move to a country where capitalism isn't the system. Find a place where everyone is supposed to get the same thing.
2. Start their own business. They can pay their employees ten times the minimum wage, pay them for hours they are not at work, all sorts of benefits.
itsyourboypookie
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Funky Winkerbean said:

itsyourboypookie said:

Trump already knows there is no tax on tips
There's not? Can you post the link?


Paid in cash. Up to you to report. I'm sure servers keep great track of it and report every dime.
VegasAg86
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AG
richardag said:

VegasAg86 said:

samurai_science said:

itsyourboypookie said:

Trump already knows there is no tax on tips
Credit Card Tips are taxed, and so are cash if they are dumb enough to report them.
The employees report tips to the employers and the employers report them to the IRS. Reported tips of less than 8% of gross sales is a trigger for investigation.
I never heard this, could you provide any links or proof?


https://www.rrgconsulting.com/what-employers-need-to-know-about-tip-reporting.html
BluHorseShu
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AG
LOYAL AG said:

No Spin Ag said:

Good Trump. Hopefully it's something he can make happen if he gets elected.

I'm sure many people who's primary job is in the hospitality sector would love to have more of their money at the end of the day.

Also, for those who don't know, leave a cash tip. It'll work the same for them until/if Trump's idea becomes a reality.


Cash tips are still taxed. Now if they aren't reported correctly that's a different issue but that would be tax evasion even if it's really difficult to catch. Still cash tips aren't exempt from income taxes.
I'm sure waiters and waitresses have always predominantly reported their cash tips (huge eye roll). That is and has always been the upside to cash tips bc most hospitality workers (specifically waitstaff) barely make enough to get by. I'm all for cutting taxes. But this will impact such a negligent number of people, it certainly won't impact votes. I'm sure waitstaff across the country are laughing at this saying "um…I was supposed to report my cash tips to be taxed??? "
LOYAL AG
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AG
BluHorseShu said:

LOYAL AG said:

No Spin Ag said:

Good Trump. Hopefully it's something he can make happen if he gets elected.

I'm sure many people who's primary job is in the hospitality sector would love to have more of their money at the end of the day.

Also, for those who don't know, leave a cash tip. It'll work the same for them until/if Trump's idea becomes a reality.


Cash tips are still taxed. Now if they aren't reported correctly that's a different issue but that would be tax evasion even if it's really difficult to catch. Still cash tips aren't exempt from income taxes.
I'm sure waiters and waitresses have always predominantly reported their cash tips (huge eye roll). That is and has always been the upside to cash tips bc most hospitality workers (specifically waitstaff) barely make enough to get by. I'm all for cutting taxes. But this will impact such a negligent number of people, it certainly won't impact votes. I'm sure waitstaff across the country are laughing at this saying "um…I was supposed to report my cash tips to be taxed??? "


Depends on how well run the restaurant is. A receipt without a tip should be questioned by the owner/manager. As noted if tips are too low relative to sales that's going to draw attention.

Truth is in today's world the vast majority of tips are collected via credit card. I'm intimately aware of a handful of locally owned businesses and all of them have to withdraw cash from the bank several times per week to pay tips at the end of the day meaning there isn't sufficient cash payments to even cover tips.
A fearful society is a compliant society. That's why Democrats and criminals prefer their victims to be unarmed. Gun Control is not about guns, it's about control.
Agsinheart
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I tip whether the service is good or not, if I tip at a place where their service isn't really good, it's usually very little. But if I enjoy their service so much which usually comes from the waitress serving my table, I tend to put a smile on his/her face, that's a voluntary gift that comes from deep down my heart . It's in cash and it's less than 16k, so I don't expect it to be taxable!
ts5641
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VitruvianAg said:

Jeeper79 said:

This sounds pretty liberal.


Not possible, liberals have never met a tax they don't love.

But it's a genius move by Trump to lure the younger womens vote to the Republican side.
Yep, give the people a clear choice. A candidate that believes in keeping your own money and lowering taxes or one that wants every last cent you make and a bloated bureaucracy.
IslanderAg04
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Space-Tech said:

How about they federally require businesses to pay workers a decent living wage. If your business model requires the exploitation of employees, then you shouldn't be in business.


You ever worked in service industry?
American Hardwood
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AG
BluHorseShu said:

LOYAL AG said:

No Spin Ag said:

Good Trump. Hopefully it's something he can make happen if he gets elected.

I'm sure many people who's primary job is in the hospitality sector would love to have more of their money at the end of the day.

Also, for those who don't know, leave a cash tip. It'll work the same for them until/if Trump's idea becomes a reality.


Cash tips are still taxed. Now if they aren't reported correctly that's a different issue but that would be tax evasion even if it's really difficult to catch. Still cash tips aren't exempt from income taxes.
I'm sure waiters and waitresses have always predominantly reported their cash tips (huge eye roll). That is and has always been the upside to cash tips bc most hospitality workers (specifically waitstaff) barely make enough to get by. I'm all for cutting taxes. But this will impact such a negligent number of people, it certainly won't impact votes. I'm sure waitstaff across the country are laughing at this saying "um…I was supposed to report my cash tips to be taxed??? "
I think the point of this idea is to get a very large and typically younger and poorer group of people (i.e. democrat voters) to start thinking that maybe there is another way to increase your income without having to demand higher wages that would threaten the very businesses they work for.
Funky Winkerbean
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AG
itsyourboypookie said:

Funky Winkerbean said:

itsyourboypookie said:

Trump already knows there is no tax on tips
There's not? Can you post the link?


Paid in cash. Up to you to report. I'm sure servers keep great track of it and report every dime.


You are contradicting yourself.

richardag
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VegasAg86 said:

richardag said:

VegasAg86 said:

samurai_science said:

itsyourboypookie said:

Trump already knows there is no tax on tips
Credit Card Tips are taxed, and so are cash if they are dumb enough to report them.
The employees report tips to the employers and the employers report them to the IRS. Reported tips of less than 8% of gross sales is a trigger for investigation.
I never heard this, could you provide any links or proof?
https://www.rrgconsulting.com/what-employers-need-to-know-about-tip-reporting.html
Thank you, I was unaware of this.
quote from the article:
  • Now here is where it gets "dicey". This report is organized in such a way as to highlight any shortfall of reported tips below 8% of gross receipts from food and beverage sales. This line item is like a "flashing red light" to the IRS indicating that your employees may not be reporting all their tips. In fact, if your total reported tips are less than 8% of total food and beverage sales, then you must allocate additional tip income to the W2 of every tipped employee that reported less than 8% of their respective sales, so that their total reported income reflects this minimum 8% allocation.
Forcing a restaurant to add additional tip income to the W2 is straight up bull***** Congratulations on our IRS becoming mini dictators.
Among the latter, under pretence of governing they have divided their nations into two classes, wolves and sheep.”
Thomas Jefferson, Letter to Edward Carrington, January 16, 1787
techno-ag
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AG
Vote Trump to end that is what he's saying.
Trump will fix it.
VegasAg86
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AG
richardag said:

VegasAg86 said:

richardag said:

VegasAg86 said:

samurai_science said:

itsyourboypookie said:

Trump already knows there is no tax on tips
Credit Card Tips are taxed, and so are cash if they are dumb enough to report them.
The employees report tips to the employers and the employers report them to the IRS. Reported tips of less than 8% of gross sales is a trigger for investigation.
I never heard this, could you provide any links or proof?
https://www.rrgconsulting.com/what-employers-need-to-know-about-tip-reporting.html
Thank you, I was unaware of this.
quote from the article:
  • Now here is where it gets "dicey". This report is organized in such a way as to highlight any shortfall of reported tips below 8% of gross receipts from food and beverage sales. This line item is like a "flashing red light" to the IRS indicating that your employees may not be reporting all their tips. In fact, if your total reported tips are less than 8% of total food and beverage sales, then you must allocate additional tip income to the W2 of every tipped employee that reported less than 8% of their respective sales, so that their total reported income reflects this minimum 8% allocation.
Forcing a restaurant to add additional tip income to the W2 is straight up bull***** Congratulations on our IRS becoming mini dictators.


Yep, and they don't need 87,000 new agents to audit the 1000 billionaires in the US.

Econ 101: if you want more of a behavior subsidize it; if you want less of a behavior, tax it. We subsidize unemployment and tax wages.

A consumption tax would be better, but there is far too much money in the income tax industry and power in writing the tax code. It's unlikely to change.

We have the government the antifederalists feared. Direct election of senators and the income tax were significant drivers of that.

Edit to add: no doubt not all cash tips are reported, but it isn't quite as simple as just pocketing all of them.
Artorias
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AG
TexasRebel said:

I don't tip servers.

I give them a non-taxable personal gift of less than $16,000.
Cash tips are best. It is pretty obvious why
one safe place
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itsyourboypookie said:

Funky Winkerbean said:

itsyourboypookie said:

Trump already knows there is no tax on tips
There's not? Can you post the link?


Paid in cash. Up to you to report. I'm sure servers keep great track of it and report every dime.
Need to read up on allocated tips.
2/10 SWB
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I'm late to the conversation, but wouldn't this increase bars & restaurants employment costs for bartenders and waitresses over 300%? Right now, in Texas at least, bars & restaurants pay servers $2.13. If the server doesn't clear at least minimum wage ($7.25) in a pay period, the business has to make up the difference. This would de facto require every business to pay $7.25 minimum. Sure, they could sell a couple of more teas per hour, but otherwise, menu prices go up, and the server still expects 15-25%. Sounds kinda inflationary.
VegasAg86
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AG
2/10 SWB said:

I'm late to the conversation, but wouldn't this increase bars & restaurants employment costs for bartenders and waitresses over 300%? Right now, in Texas at least, bars & restaurants pay servers $2.13. If the server doesn't clear at least minimum wage ($7.25) in a pay period, the business has to make up the difference. This would de facto require every business to pay $7.25 minimum. Sure, they could sell a couple of more teas per hour, but otherwise, menu prices go up, and the server still expects 15-25%. Sounds kinda inflationary.


Changing the taxable status of the tips doesn't mean they aren't getting them.
2/10 SWB
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But it would mean that the servers aren't being paid at least $7.25 per hour. Those gifts (tips) don't count against the minimum wage. Therefore, the business will have to make up the pay difference between $2.13 and $7.25. Therefore, the business will have to pay an additional $5.12 per hour per server. Bars and restaurants are low margin businesses. That additional $5.12 per hour will be reflected in the cost of goods. It's no different than promising servers a "living wage." The consumer will be asked to pay more, and if the consumer refuses, the bar or restaurant goes out of business and the server loses their job.


I did take Econ 101. I got a C+
TexasRebel
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2/10 SWB said:

I'm late to the conversation, but wouldn't this increase bars & restaurants employment costs for bartenders and waitresses over 300%? Right now, in Texas at least, bars & restaurants pay servers $2.13. If the server doesn't clear at least minimum wage ($7.25) in a pay period, the business has to make up the difference. This would de facto require every business to pay $7.25 minimum. Sure, they could sell a couple of more teas per hour, but otherwise, menu prices go up, and the server still expects 15-25%. Sounds kinda inflationary.


It would also make service go to s***
 
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