[JSR22]

Originally Posted by Velvet

In the past before I knew about pooling I strictly tipped the server. If I knew that “the company” was taking it, there would have been no tip at all.They can raise the prices if they need it so much and pay proper wages. The servers are not working on commissions.

What company is taking tips? I doubt that it is true.

[Velvet]

Originally Posted by JSR22

What company is taking tips? I doubt that it is true.

That is how I read the above post. Perhaps I misunderstood. My impression of tipping was a thank you for the service the individual has provided for you.

Sometimes I consider their situation. I had an incident where an older handyman came to fix my fridge drawer for me. He couldn’t but I tipped him for coming out, his gas and trying although he, himself, charged nothing. Then I fixed the drawer myself. I believe he was working for himself so no wages from a different source.

I have a question: do the “suggested” tips on machines etc include the tax when a percentage is taken? Am I tipping the IRS as well?

[JGibson]

So glad I rarely eat out.

I don't have any of these restaurant complaints that so many on TV have.

[fdpaq0580]

Originally Posted by BrianL99

A "Tip" is not a "gift", it is a voluntary payment for services and it is NOT rendered to a "person", but to a company that person works for. If a server in a "shared tip" environment chooses to keep a cash tip to herself/himself, they are thieves.

WRONG! Big time!!
The "tip" or, more properly, gratuity is a gift of appreciation to the server, and no one else, for their attention and service. Maybe, to circumvent your larcenous suggestions, customers should tip via check, in a sealed envelope with written instructions to open at a later time in the presence of their attorney.

[Michael G.]

Originally Posted by JGibson

So glad I rarely eat out.

I don't have any of these restaurant complaints that so many on TV have.

I was told that the average villager eats out 4X a week, on average.

[fdpaq0580]

[QUOTE=BrianL99;22 If you pay in cash for an item with a $50 bill and when you get home, you found you were only given change for a $20 bill ... who do you call and who do you hold responsible? If you hand cash to a person who is working at a business, that cash is the property of the business.[/QUOTE]

If I pay in cash for an item, I count my change before putting it in my pocket. But, if I didn't, for some strange reason, and when I got home and found an error, I might call the establishment where I purchased the item, but ultimately, the responsibility is mine for failing to check my change. The payment is for the item, remember?
If, however, after paying for the item, I choose to give the server a gift/tip/gratuity for their personal service, that gift is for them and not for would be thieves to take it from them.

[Bill14564]

Originally Posted by Velvet

...

I have a question: do the “suggested” tips on machines etc include the tax when a percentage is taken? Am I tipping the IRS as well?

That depends on how the machines were programmed; I have seen the calculation done both before and after tax.

By the way, this has nothing to do with the IRS - sales tax is collected by the State.

[fdpaq0580]

Originally Posted by Velvet

That is how I read the above post. Perhaps I misunderstood. My impression of tipping was a thank you for the service the individual has provided for you.

Sometimes I consider their situation. I had an incident where an older handyman came to fix my fridge drawer for me. He couldn’t but I tipped him for coming out, his gas and trying although he, himself, charged nothing. Then I fixed the drawer myself. I believe he was working for himself so no wages from a different source.

I have a question: do the “suggested” tips on machines etc include the tax when a percentage is taken? Am I tipping the IRS as well?

Don't go by suggested tips on machines and verify that the tip hasn't already been added. You may be tipping on the added tip. Make sure your bill is correct and then tip what YOU feel is appropriate. Don't be embarrassed or emotionally blackmailed into tipping what someone else wants you too.

[retiredguy123]

Originally Posted by Bill14564

That depends on how the machines were programmed; I have seen the calculation done both before and after tax.

By the way, this has nothing to do with the IRS - sales tax is collected by the State.

I agree, but do the math. If a restaurant has $1,000,000 in gross sales and receives 15 percent of it in tips, that is $150,000. So, if they program their receipt machine to incorrectly collect a 7 percent sales tax on the tip income, they will be overpaying their sales tax bill to the state by $10,500. I cannot imagine that many restaurants would be foolish enough to do that.

[Pugchief]

Originally Posted by Pugchief

If you can't afford to tip 15-20%, don't eat out. Whether you agree with the "system" of gratuities in the US is immaterial; that's the way it is and the servers depend on the tips to make wages.

Originally Posted by fdpaq0580

Are you implying we need to eat out because it is our responsibility to ensure that restaurant staff make a living wage? If restaurants payed their employees properly, tipping would be unnecessary and probably nonexistent. Customers have been conned into this tipping15, 20 and higher % because WE are their welfare subsidies. And the bs crack about "if you can't afford the tip", is just a passive-aggressive insult.

You clearly don't understand how small businesses function. In order to make a profit and thus stay in business, you have to charge, in aggregate, more than the total cost of your expenses. Those expenses include wages. So let's hypothetically say that tipping was not customary (Japan is like that, you are expected NOT to tip). So instead of gratuities, the restaurant owner pays the waitstaff 20% more than they currently do. What do you think happens as a result? They raise the price of EVERY ITEM on the menu in order to still make the same profit. So does every other sit down restaurant. So you end up paying that "tip" either way. If you understood that, you wouldn't consider my "BS crack" to be passive aggressive, but rather, common sense.

You're welcome, and yes, I am a former small business (not restaurant) owner.

[Bill14564]

Originally Posted by retiredguy123

I agree, but do the math. If a restaurant has $1,000,000 in gross sales and receives 15 percent of it in tips, that is $150,000. So, if they program their receipt machine to incorrectly collect a 7 percent sales tax on the tip income, they will be overpaying their sales tax bill to the state by $10,500. I cannot imagine that many restaurants would be foolish enough to do that.

I thought the question was about how the suggested tip was calculated.

If my purchases total $100 I would be charged $7 in tax for a total of $107. Is the suggested 20% tip calculated to be:
- $20 because it is based on the pre-tax amount?
- $21.40 because it is based on the post-tax amount?
I have seen both.

Note: Neither of those affect the amount of tax paid to the State (and County). That amount is calculated on the $100 sales total regardless of how the machine calculates the suggested tip.

[retiredguy123]

Originally Posted by Bill14564

I thought the question was about how the suggested tip was calculated.

If my purchases total $100 I would be charged $7 in tax for a total of $107. Is the suggested 20% tip calculated to be:
- $20 because it is based on the pre-tax amount?
- $21.40 because it is based on the post-tax amount?
I have seen both.

Note: Neither of those affect the amount of tax paid to the State (and County). That amount is calculated on the $100 sales total regardless of how the machine calculates the suggested tip.

Not the way I read the post. I think the poster wanted to know if they were being charged sales tax on the tip amount, and, thereby, giving money to the Government that was not owed.

Sales tax does not apply to tip income as long as the tip is completely voluntary. If the tip is mandatory, then sales tax does apply.

[Velvet]

Originally Posted by Pugchief

You clearly don't understand how small businesses function. In order to make a profit and thus stay in business, you have to charge, in aggregate, more than the total cost of your expenses. Those expenses include wages. So let's hypothetically say that tipping was not customary (Japan is like that, you are expected NOT to tip). So instead of gratuities, the restaurant owner pays the waitstaff 20% more than they currently do. What do you think happens as a result? They raise the price of EVERY ITEM on the menu in order to still make the same profit. So does every other sit down restaurant. So you end up paying that "tip" either way. If you understood that, you wouldn't consider my "BS crack" to be passive aggressive, but rather, common sense.

You're welcome, and yes, I am a former small business (not restaurant) owner.

Yes, if they raised the prices, that would be honest and transparent. I’m good with that.

[Velvet]

Originally Posted by retiredguy123

Not the way I read the post. I think the poster wanted to know if they were being charged sales tax on the tip amount, and, thereby, giving money to the Government that was not owed.

Sales tax does not apply to tip income as long as the tip is completely voluntary. If the tip is mandatory, then sales tax does apply.

Thank you, you clarified what I was struggling to say.

[Gpsma]

So, lets say, i go to a restaurant and order a burger and a coke. Someone next to me orders a filet mignon with a coke. So the smiley waitress delivers our orders.
The wonderful smiley waitress did nothing more in service to either of us. So we are both to tip her or him 20% of the check?