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German reader here. Because of minimum wage you'd only tip if service was good (or always tip if you have enough money, my parents generation are more frugal th

German reader here. Because of minimum wage you'd only tip if service was good (or always tip if you have enough money, my parents generation are more frugal than I am). Delivery services often get around minimum wage because they use the "Uber" trick and technically the drivers are "self-employed", always tipping those folks. Anyway: Are tips taxable in the US? Here in Germany tips are tax-free under certain conditions: If I give it directly to the barber, waiter, etc., it is a non-taxable event, while if the employer collects the tip and divides it up under all employees it is a taxable event.

Rebelgecko 8y ago
Officially yes, all tips are taxable. However people that get cash tips often don't report and pay taxes on them.
donarb 8y ago
Tips are taxable income in the US, even to the point where the IRS will assume a minimum amount of tip income, even if you didn't receive that much.
- donarb 8y ago
  Here is an article about the Supreme Court case that upheld it. http://articles.latimes.com/2002/jun/18/business/fi-tips18 http://articles.latimes.com/2002/jun/18/business/fi-tips18
ylesaout 8y ago
Here is a difference between EU countries. In France, you cannot even tip by credit card or anything else that can be controlled by the employer or the state. It's only cash and at your discretion. Thus, it cannot even be a taxable event. However you need to have some cash if you want to tip.
- evilolive 8y ago
  I think you can, you have to ask "I want to tip x euros" before the waiter puts your cc in the machine. It feels really awkward and so most don't do it
  - ylesaout 8y ago
    Indeed you are right, you can do it! However they need to add a line to the invoice to sell you something more (e.g. a bottle of water). And when they will report what they have sell and what they have buy there will be a difference. So for few customers it may be OK, but they can't do it every time.

Rebelgecko 8y ago

Officially yes, all tips are taxable. However people that get cash tips often don't report and pay taxes on them.

donarb 8y ago

Tips are taxable income in the US, even to the point where the IRS will assume a minimum amount of tip income, even if you didn't receive that much.

donarb 8y ago
Here is an article about the Supreme Court case that upheld it. http://articles.latimes.com/2002/jun/18/business/fi-tips18 http://articles.latimes.com/2002/jun/18/business/fi-tips18

ylesaout 8y ago

Here is a difference between EU countries. In France, you cannot even tip by credit card or anything else that can be controlled by the employer or the state. It's only cash and at your discretion. Thus, it cannot even be a taxable event. However you need to have some cash if you want to tip.

evilolive 8y ago
I think you can, you have to ask "I want to tip x euros" before the waiter puts your cc in the machine. It feels really awkward and so most don't do it
- ylesaout 8y ago
  Indeed you are right, you can do it! However they need to add a line to the invoice to sell you something more (e.g. a bottle of water). And when they will report what they have sell and what they have buy there will be a difference. So for few customers it may be OK, but they can't do it every time.