2007-12-28 15:38:58 · 9 answers · asked by sportman16977 2 in Politics & Government ➔ Law & Ethics
A lot of these restaurant servers are paid at, or just slightly above minimum wage. Employers hire them for so little pay on the rationale that they'll make it up on tips. Factor in that most servers are single moms, struggling to raise one or more children on their low wages and tips, and it leaves to argue that these servers should be allowed to keep their tips as unreported income. They also have to share a portion of their tips with the busboy, who cleans their table stations in good record time. On a good day, servers will pocket $50 or more in tips after an 8-hour shift. On a slow day, they're lucky to make $10 in tips after a full shift.
2007-12-28 15:59:53 · answer #1 · answered by Corporate America !! 5 · 0⤊ 0⤋
If that lady is tellin the truth about the possibility of going to jail for tax fraud I'd say they should although I don't think its quite fair with the wages they make a law should be made that if you make X amount of money an hour yes you do do have to claim tips if you do not make X amount of money an hour you do not have to claim your tips. Any other job if you receive bonuses such as win I win Gas Cards, money, walmart cards at work I have to claim that because according to the government that is income even if it is in plastic form. I think it is a thin line between rather you should or shouldn't if you took a survey of every server at every restaraunt chances are the majority don't claim their tips. Now if that lady was right, each and every one of these people could end up in jail, I don't think the government has the time or wants to take the time to investigate each and every incident of each and every server at each and every restaraunt in each and every state in the country. Is it the honest thing to do? Yes it is. Is it the most economical solution for the person involved (the server probably not) It's something each person has to decide for themselves. I mean if you can't afford gas money to get back and forth and the difference is not claiming your tips I wouldn't advise you to go without but then again that lady scared me so its up to the individual all the way.
2007-12-29 22:57:29 · answer #2 · answered by ohioguy4jc 4 · 1⤊ 0⤋
If they do not claim their tips those tips can not be taxed (it is taxable income for both you and your employer). The tax impact on the server is minimal (10% maybe). Many servers don't even make enough money to be eligible for income taxes and so they get it all back in the form of a tax return. Businesses often push their servers not to claim all of their tips because it saves the business tax money.
You should absolutely claim all of your tips.
Not claiming any portion of your tips is tax fraud, and it is a felony. You can serve prison time for it. If the IRS ever audits the business they will very likely catch you. This form of fraud happens in the vast majority of businesses that employ tipped labor. It's not a new idea and the IRS goes straight for it in an audit. Since the IRS can not go over every tip sheet in every restaurant every day they use the tactic of making examples out of people and the punishments are usually very harsh.
You're also losing social security benefits for later and many other perks to paying your taxes.
2007-12-28 15:55:45 · answer #3 · answered by Colt & Tegan 4 · 0⤊ 0⤋
they should claim them all for tax reasons but in some states a waiter/waitress only makes $2 an hour and many times i have seen them not receive a paycheck because the taxes on the tips was more then the paycheck
i know the rules on this say that the tips would make there pay equal or more then minimum wage but often this is not the case
2007-12-28 15:50:28 · answer #4 · answered by little78lucky 7 · 0⤊ 0⤋
For obvious reasons: They don't want to be taxed on them. Dishonest as it is, most servers justify it in saying that they are already taxed enough as it is, and they only make a small hourly wage.
They should pay it, but they don't because they think that GOVERNMENT doesn't deserve it. (To a large degree, they don't)
What they don't think about is the fact that their fellow Americans HAVE to be honest because we don't get paid in cash and we are stuck paying our full taxes while they get away with cheating the system. Not fair.
2007-12-28 15:52:21 · answer #5 · answered by emericanpride18 1 · 0⤊ 0⤋
You document your finished innovations gained and any tip-outs on your corporation. you're taxed on your internet innovations, although you ought to document tip-outs on the time which you paid them. you may desire to maintain a checklist of who the tip-outs have been paid to. in case you fail to document the tip-outs on the time which you pay them, you may't deduct them later. that is all or not something on the time which you document the innovations and tip-outs. "notice:I do incorporate my money innovations..." do not even think of of going there! you're required by regulation to document ALL innovations. era! in the journey that your corporation is telling you to document much less, he's violating the regulation. in case you pass alongside with it, you're as to blame as he's.
2016-12-11 15:26:36 · answer #6 · answered by Anonymous · 0⤊ 0⤋
claim them on what exactly? on their Tax forms? Then they'd have to pay taxes on them
2007-12-28 15:46:41 · answer #7 · answered by arkainisofphoenix 3 · 0⤊ 0⤋
They don't want to pay the taxes and yes, they should. It's cheating and expecting others to pay for them.
2007-12-28 15:46:15 · answer #8 · answered by ? 7 · 0⤊ 0⤋
They're supposed to.
2007-12-28 15:49:29 · answer #9 · answered by DOOM 7 · 0⤊ 0⤋