my employer changes my tips ??????

[realscrewedup]

What is the name of your state?georgia okay i have been a waitress for about 12 years now and i most definately know the law when it comes to claiming my tips .alot of people think well8 % is good or whatever the case may be . welli know the law requires 100% of my tips to be reported. which i do claim everyday when i clock out.BUT at the end of the week when payroll is being done, the managers go in and change everyones tips down to 10%. Now i want to know how can that be legal?And what can i do about this without getting myself in a bunch of trouble with the irs. being that it is indeed my employer who is trying to get out of paying more taxes ? i hope this makes sense to someone who might be able to help me file a claim perhaps .

 

[Beth3]

When you say "change my tips," you aren't saying that they are taking money from you, right? They're just reporting estimated tips for federal and state withholding purposes, correct?

This is a payroll issue that is limited to businesses where employees regularly receive tip income but I believe that there is a minimum amount of tips that the employer must declare on an employee's paycheck and withhold accordingly. Based on your post, I'm going to guess that it's 10%. If you receive more than that in tips, YOU are supposed to declare that income on your year-end tax return and pay the taxes on that money accordingly.

I don't think your employer is doing anything prohibited - there merely complying with federal/state minimum requirements. If you want a more detailed/expert opinion (and nobody else replies here with a definitive answer), you're going to have to talk to a tax accountant or call the IRS for clarification.

 

[StacyLB]

Are you the only one claiming 100%? If so, then my thought is that the restaurant is doing this to keep from being audited. If you're claiming $500 each week in tips and all the other servers are claiming $175, it increases the likelihood that the IRS will red flag the restaurant. They not only would audit all the servers, but the restaurant itself would likely be audited as well. Not to mention the reports the restaurant will have to generate...Bottom line, it's a huge aggravation.

That being said, they have no legal grounds to lower your reportable income. Any more than they have legal ground to raise the reportable income of someone they don't believe are claiming enough. Before anything, I would speak to the managers and talk to them about what you think they are doing.

Other than talking to them, I can't think of a scenario that would allow you to keep your job. You can contact the IRS, but I sincerely doubt your employer will allow you to stick around.

 

[StacyLB]

Beth, if the system is computerized, she should be able to enter the exact amounts of the tips and the restaurant assumes responsibility for reporting. At least that's how it was handled when I waited tables.

 

[Beth3]

Thanks, Stacy. When we get on the payroll side of things, particularly with tip income, I'm shooting in the dark a bit.

What still isn't clear though is whether the employer is legally obligated to report and tax all the tip income reported by the employee.

 

[realscrewedup]

ok the problem here is . indeed it is a computerized system. and i do claim all the tips at the end of my shift.no, alot of the other servers do not claim all of their tips because they are married and do not want to pay in at the end of the year.During tax season last year i asked the manager to stop this and that all my income needs to be reported and he just kept it short and simple and said i change them all.i mean this screws me up when i want to apply for anything as far as credit and that is not even the most important.paying in my social security taxes.isn't your employer supposed to match some of those.as far as the whole restaurant getting audited ,i feel that it shouldn't be my problem if i'm the only one in the place trying to do right. this is where it is so confusing.and also if iam indeed trying to claim all of my tips and they change them shouldn't they be held responsible.i mean why should i be held responsible when i am doing what im supposed to be.by the way ,thanks for all the imput so fast.

 

[StacyLB]

When I mentioned the audit process, please know I wasn't condoning the behavior of your employer! Sometimes it helps when people understand the why.

I've been there done that on the credit thing you describe--my mother had to cosign the loan for my first car!

Is your employer a local restaurant or a chain? If there are corporate headquarters, you should start with reporting to the HR function within the corporation. From there follow their advise.

If your employer is not a chain, I think your only choice is to speak with the IRS. I'm sure they will have suggestions on how to proceed.

The one thing I think you need to understand is that there is likely no way for you to report this and keep your job. I'm not saying this to discourage any action on your part, but so you can make an informed decision in terms of how to proceed.

 

[realscrewedup]

The corporate office is the reason why my management team does this . They are told to do this . I don't expect to keep this job.I mean this isn't the only thing going on that i dont think is fair but this indeed is by far the most important.I think that it is unfair , it looks like no matter which route i go i'm gonna be screwed.

 

[StacyLB]

Likely, you'll be best off contacting the IRS and applying at another resaurant at the same time. Best of luck.