Quote:
Originally Posted by mraines
I need to do more research on this, but I have been asking around as it differs in different establishments. I have found that some do, some don't. I have also found that if you put the tip on a credit card, it goes on their paycheck and therefore is taxed. I need more clarification. I don't know if dishwashers and cooks make minimum wage, but they should. They all should make minimum wage and not have to rely on tips. There does not seem to be a uniform way of distributing tips.
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If it is done correctly, a tip placed on a credit card should not go into the server's paycheck. It should be paid directly to the server and not taxed. The server only pays tax on their tips based on the "allocated" tip amount that appears in Box 8 of their W-2 form.