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Author Topic:   Tipped Employees
misha
Member (Idle past 2704 days)
Posts: 69
From: Atlanta
Joined: 02-04-2010


Message 16 of 19 (556904)
04-21-2010 4:10 PM
Reply to: Message 10 by subbie
04-20-2010 12:02 AM


Re: Will never tip again!
I am curious about one thing: how do servers feel about customers who stiff on tips because of bad service?

I worked in an upscale restaurant in Atlanta for 2 weeks before I was offered my current job. In those 2 weeks I learned how important tipping was but also how important service was. Since then my spread on tipping has increased.

I'm willing to tip more than before for good service and i'm willing to tip less for poor service. Consider it natural selection. If you aren't good, then you shouldn't get paid well. That way you will either need to find a different job or get better at the one you do.


This message is a reply to:
 Message 10 by subbie, posted 04-20-2010 12:02 AM subbie has acknowledged this reply

  
purpledawn
Member (Idle past 1533 days)
Posts: 4453
From: Indiana
Joined: 04-25-2004


Message 17 of 19 (556943)
04-21-2010 7:48 PM
Reply to: Message 10 by subbie
04-20-2010 12:02 AM


Social Security
quote:
Plus, not only would they have to pay more in wages, that would also increase the amount they would have to pay for their share of the contribution to SS benefits. Instead, the servers end up having to pay that amount themselves.
From what I've found out the employers do pay or should be paying all of their own share of the SS benefits on the wages plus tips reported.

Odds are the amount not paid is the employees portion if it exceeds the $2.13 per hour the employer has access to.

What Employers Need to Know About Tip Reporting

IRS requires tipped employees to provide this report once a month, you will need a report for every payroll period, otherwise you cannot correctly report the employee’s total wages, nor can you withhold the proper taxes (and pay your share of FICA tax).

So if tipped employees went to non-tipped and were paid the standard minimum wage, that amount would actually go down for employers assuming the employees are averaging more than the non-tipped minimum wage.


This message is a reply to:
 Message 10 by subbie, posted 04-20-2010 12:02 AM subbie has responded

Replies to this message:
 Message 18 by subbie, posted 04-21-2010 7:50 PM purpledawn has responded

  
subbie
Member (Idle past 36 days)
Posts: 3508
Joined: 02-26-2006


Message 18 of 19 (556944)
04-21-2010 7:50 PM
Reply to: Message 17 by purpledawn
04-21-2010 7:48 PM


Re: Social Security
Ah, I did not know that. Thanks.


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This message is a reply to:
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purpledawn
Member (Idle past 1533 days)
Posts: 4453
From: Indiana
Joined: 04-25-2004


Message 19 of 19 (556998)
04-22-2010 3:12 AM
Reply to: Message 18 by subbie
04-21-2010 7:50 PM


Allocated Tips
I don't like the Allocated Tips.

The IRS assumes that all directly tipped employees of a food and beverage establishment should receive tips in the amount of 8% of the establishment’s gross food and beverage receipts. Each year the employer must file Form 8027, Employer’s Annual Information Return of Tip Income and Allocated Tips. The Instructions for Form 8027 state that if the total reported tips is less than 8% of the gross receipts, the difference must be allocated to the directly tipped employees.

The employee doesn't have to pay tax on the allocated tips if he can prove he accurately claimed all tips.

Tipped employees have an obligation to pay income taxes on the tips they receive, so they must try to keep accurate records of tips received. If an employee receives a Form W-2 at the end of the year with allocated tips reported in Box 8, the employee must either add those allocated tips to his reported income, or he can ignore them if he can prove that he reported all of his tips. Thus, good record keeping can save taxes in the long run.

If one claims everything they wrote down for the employer, how could the IRS say they didn't claim all their tips? How does one prove they didn't receive any more cash than they claimed?

Hopefully no one falls for that and pays taxes on what they didn't actually receive.


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