Calculating Tip: Include Tax or Not?

[disneysteve]

I always tip with cash, even if I pay with a credit card. That way the server can choose whether or not to pay taxes on the tip.

I'm not sure that makes a difference. Aren't they assumed to be earning a certain amount and that's what they get taxed on?

[PrincessPerky]

you are supposed to claim what you were tipped...most servers do not claim all they are given...I was told to claim at least 7% to avoid getting an audit.. I generally claimed 10 if I had it ....well that was when I worked eons ago (I am getting old!)

[disneysteve]

you are supposed to claim what you were tipped...most servers do not claim all they are given...I was told to claim at least 7% to avoid getting an audit.. I generally claimed 10 if I had it ....well that was when I worked eons ago (I am getting old!)

How were tips on credit cards handled? Did those get reported as income or was it still up to you to report it? I know I've been in plenty of places where I left the tip on the credit card and when I paid the bill, I saw the cashier take out the cash for the tip and give it to the server.

[DebbieL]

When I worked as a waitress I never claimed a dime of my tip money (and neither did anyone else I knew in the industry at the time). For tips left on credit card slips, we just took the cash out of the till.

[geojen]

Where I worked, we got cash out of the till for credit card tips. However, the register had a record of how much we had in food sales and the amount in credit card tips, so we had to claim at least the percentage that was recorded for the credit card tips.

[PrincessPerky]

I worked in PA, it may have been a state law,

The cash was taken out of the drawer for credit card tips at one store, and added to my check at another.

The claim minimum may have been the restaurants rule not state. They can get in big trouble if their wait staff doesn't claim a total of minimum wage from hourly and tips combined.

[ithaca]

So...... I think I'm going to continue to tip with cash so that it's entirely up to the server to handle it. No trouble for the restaurant, no swapping cash from the till, etc.