Any tax gurus in the house - Tilted Forum Project Discussion Community

Paq · 03-22-2006, 11:38 AM

I have a slight problem...ok, more than slight.

I work in a restaurant that does about 90% credit card business, maybe more, not sure, but over the past 4 months, i have had 1 table out of hundreds that paid cash.

so, to break it down: we are tipped mostly on credit, which we collect at the end of the night before going home. We pay 3% of our total sales out to the bussers, bartenders and hostesses, no biggie, it is automatically deducted from our tips at the end of the night. After this, we clock out and declare our tips, basically, our charge tips minus this tip share bc that is what we are physically walking out of the restaurant with. Say i had $400 in sales, was tipped 70 dollars total and paid out $12 in tipshare, i would declare $58 at the end of the night.

Now, all is well until we get our check. our accoutant looks at the income report, sees that we had $70 in charge tips, and then reports our income as $70, not $58. over the course of our 2 week pay period, this can run the difference up to about $100-150, easily, which, over the course of a year can run as high as $2000 that we did not take home. And this is showing on my W2.

I owe a good deal of money to the feds this year bc i am paying the taxes for money i did not make and my boss is saying i have to pay for every bit of our charge tips, but i have never encountered this before and nothing i have found on the IRS site suggests that. The only thing i have found is a form from the IRS showing that we can keep daily records of our tips which automatically subtracts out our tipshare.

Can anyone help me try to explain this to the accountant or can anyone show me where i'm wrong? this has been driving me insane for the past few months.

bond007 · 03-31-2006, 01:41 PM

here's a link that, hopefully, addresses your question...

http://www.irs.gov/faqs/faq-kw197.html

Paq · 03-31-2006, 01:56 PM

yeah, it took a lot and several calls to the IRS along with having thm send my employer several forms and threaten them with fines

But
i finally got it straight...

03-22-2006, 11:38 AM	#1 (permalink)
Paq Junkie Location: South Carolina	Any tax gurus in the house I have a slight problem...ok, more than slight. I work in a restaurant that does about 90% credit card business, maybe more, not sure, but over the past 4 months, i have had 1 table out of hundreds that paid cash. so, to break it down: we are tipped mostly on credit, which we collect at the end of the night before going home. We pay 3% of our total sales out to the bussers, bartenders and hostesses, no biggie, it is automatically deducted from our tips at the end of the night. After this, we clock out and declare our tips, basically, our charge tips minus this tip share bc that is what we are physically walking out of the restaurant with. Say i had $400 in sales, was tipped 70 dollars total and paid out $12 in tipshare, i would declare $58 at the end of the night. Now, all is well until we get our check. our accoutant looks at the income report, sees that we had $70 in charge tips, and then reports our income as $70, not $58. over the course of our 2 week pay period, this can run the difference up to about $100-150, easily, which, over the course of a year can run as high as $2000 that we did not take home. And this is showing on my W2. I owe a good deal of money to the feds this year bc i am paying the taxes for money i did not make and my boss is saying i have to pay for every bit of our charge tips, but i have never encountered this before and nothing i have found on the IRS site suggests that. The only thing i have found is a form from the IRS showing that we can keep daily records of our tips which automatically subtracts out our tipshare. Can anyone help me try to explain this to the accountant or can anyone show me where i'm wrong? this has been driving me insane for the past few months. __________________ Live. Chris

03-31-2006, 01:56 PM	#3 (permalink)
Paq Junkie Location: South Carolina	yeah, it took a lot and several calls to the IRS along with having thm send my employer several forms and threaten them with fines But i finally got it straight... __________________ Live. Chris

03-31-2006, 01:41 PM	#2 (permalink)
bond007 Junkie Location: too far from Texas	here's a link that, hopefully, addresses your question... http://www.irs.gov/faqs/faq-kw197.html