Is it true that waiters and waitresses get taxed on their tips?
Answers:
Yes, since tips are earnings they are taxable. Here is the IRS website: http://www.irs.gov/newsroom/article/0,,i... which includes links to the publications covering your's and your employer's responsibilities.
Yes, of course, but it only applies to the amount that they claim they have earned.
Yes.
You are supposed to keep a log of the tips you make and report them as income. In my opinion, you're dumb if you do this.
IRS will suppose that you made at least enough tips to bring your wage up to minimum wage. Servers are often paid BELOW minimum wage because they are expected to make tips.
You must report any tips that are shown on the receipt (where they pay by credit card, for instance). Handle the cash at your own discretion.
Yes, I was taxed when I used to waitress for my tips.
Yes, it is as long as you keep track of what you earned.
Yes, at the end of the night you have to declare a certain % of your sales. So, say you sold $1000 in food/drink, than the computer believes you made about $150 in tips. You will have to claim close that that amount at the end of the night. If you don't make that money, you still claim it. When I worked as a waitress, I had a few bad nights were I didn't make 15% (i worked in a low-income area) and only made 10%. My manager refused to adjust my sales report, b/c the company could be audited by the government.
Since it's hard to prove how much I did or did not make. My restuarant (a chain) made this rule. It's really unfair, b/c I'm paying federal/state taxes on money I did not make or bring home. That's why it's important to tip servers.
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