Quote:
Originally Posted by Skip
No income tax on tips (and no income tax on overtime) is unfair to both regular hourly and salary workers. Why should servers bring home income money that is tax free?
Skip
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So if you're a Consultant and charge a client, $100/hour ...
After Federal Taxes, you have about $75 left.
After you pay both sides of FICA, you $60 left.
Let's assume your "overhead" (office, equipment, phone, Insurance, etc.) is $10/hour
You now have $50 left.
If you take yourself to dinner & it cost you $40 + 25% Tip, you have ZERO left.
If your waitress is handling 5 tables, 10 people ... she just made $100/hour and gets to keep it all.
Better to quit the Consulting business and be a server.