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Tips are explicitly taxed as income to the recipient. They are not regarded as gifts by any taxing authority in the U.S.
by rprasad 14y ago
Tips are explicitly taxed as income to the recipient. They are not regarded as gifts by any taxing authority in the U.S.
- _delirium 14y agoThat's what I was arguing, that you can't classify something as a gift just because technically there is no exchange of consideration. Even though tips formally have no consideration, they still fail the detached/disinterested test, and count as income.