3 ms·
The IRS assumes servers get a certain amount of tips, so if you don't report close to what they expect, you run a high risk of being audited.
by kmoser 4y ago
The IRS assumes servers get a certain amount of tips, so if you don't report close to what they expect, you run a high risk of being audited.
- seadan83 4y agoTrue. The loophole is that most tips are on credit cards and hence automatically reported. There is no distinction of cash vs CC tips when reporting. So effectively zero dollars in cash tips is being reported. In the 90s I delivered pizzas for one of the big companies. I raised that if I didn't make tips the company was supposed to pay me $5.50 instead of the $3.25 that was my wage. The boss said, ok, but if we do that then you have to report your cash tips" - the "agreement" was quite explicit