Tipping in cash

[gooddecisions]

Yeah, I did it- started a new tipping thread. This article really makes me mad.

First I'd like to say that I worked at 3 different restaurants during my high school and college years. Second, I always tip at least 20%. I don't carry cash, frequent the same places regularly and have never had an issue tipping on my card. I was thrilled to get cash or credit card tips and this was back in the late 90s.

It's really unbelievable the reasons listed that suggest leaving a cash tip is the only reasonable thing to do. If I walk in a hair or nails place that says "cash-only" tips, I walk right out. I pay my taxes and will not support tax evasion. Unbelievable!

finance.yahoo.com/banking-budgeting/article/112298/when-tipping-ditch-credit-card-pay-cash#mwpphu-container

• "Saves" taxes: Getting paid in cash can also help workers avoid the watchful eyes of the Internal Revenue Service, which requires restaurant workers to claim all tip income -- both from credit cards and cash. "In essence, receiving tips in cash increases the waitstaff's opportunity for unreported income," says Robert Ricketts, who holds an endowed chair in taxation at Texas Tech University. "Tips received on credit cards are documented and presumably compiled by management," he says.

This is a difficult subject for many experts and industry insiders, however. "Long ago, I used to always leave cash tips out of that same sense of sisterly love -- not so much to hide the tips from the restaurant as from the IRS," says personal finance expert Liz Weston, herself a former restaurant employee."

[hoops902]

Nice, so make sure you tip in cash everyone in order to help people commit tax fraud!

[mithrin]

I can understand and agree with some of the points about how it might save the server time and make cashing out at the end of the night smoother, but that would seem to depend a lot on each particular restaurant's procedure. Some of them might hold back the interchange fees from tips, others might take time to convert the receipts into cash at the end of the night, while other restaurants might just keep track of the credit card tips and include them on the paycheck instead of cashing out each night.

However, the "Saves" taxes section is just too much. Had the article quit before this point, it might have made me consider leaving cash tips more often. But then they go and remind me that leaving cash tips is a good way to enable the server to cheat on taxes (or short the bussers/etc. on tip sharing). I was always especially annoyed with this in CA, where the servers make full state minimum wage + tips (per state law), but still complain that 15% isn't enough. But cross into any neighboring state, and the servers are making $5-6 less per hour, and getting the same tips.

Generally, I don't leave cash tips because I don't carry much cash around. Putting in on the card also saves me from dealing with having the correct change. It's also easier to track our eating out expenses if the entire expense is on the CC bill.

[Sum Dum Gai]

15% and it's going on the card. If the server wants to cheat the tax man, she's got to do the work, I'm not doing it for them.

[MN-Investor]

Actually, the article is reasonably balanced and interesting. Evading taxes is only one of numerous reasons some people tip in cash. And you omitted the remaining part of Liz Weston's comments: "Weston now takes a different view of this approach. "A lot of things changed, including the IRS rules on tip income (which got tougher) and my own attitude, which became: 'I really shouldn't help people evade taxes,'" she says via e-mail."

The author has some very valid reasons for tipping in cash. I never realized that some restaurants will reduce credit card tips by the associated credit card interchange fee.

[jd2005]

"I never realized that some restaurants will reduce credit card tips by the associated credit card interchange fee. "

That may be, but I find that I usually leave a higher tip (closer to 20%) on the credit card than with cash (when I have it).

[8 Bit WWBG]

...:::"I never realized that some restaurants will reduce credit card tips by the associated credit card interchange fee. ":::...

The whole fee, or just a % of the fee equal to what percentage the tip represents in the total cost. IMO doing the above is piss poor business judgment in an already high turnover industry. I hope the $2.00 that the restaurant saves on that transaction is worth the $20 steak the employee steals from the freezer.

[Sum Dum Gai]

In CA it's illegal for the restaurant to take any portion of the credit card fee from the server's tip. They also get paid regular state minimum wage, instead of the $3.15 an hour or whatever that they make in other states.

[NomoreDramaQ1015]

I never had the transaction fee taken out of my tips. Personally I liked cash because I could just give the busboy his money rather than have him follow me around the entire resturant because his shift is over and mine isn't and he wants to hurry up and leave. Cash on hand meant I could get him out of my face. For CC tips I had to wait till my shift was over and the manager cashed me out.

[gooddecisions]

......."Actually, the article is reasonably balanced and interesting. Evading taxes is only one of numerous reasons some people tip in cash. And you omitted the remaining part of Liz Weston's comments: "Weston now takes a different view of this approach. "A lot of things changed, including the IRS rules on tip income (which got tougher) and my own attitude, which became: 'I really shouldn't help people evade taxes,'" she says via e-mail. The author has some very valid reasons for tipping in cash. "

I didn't want to post nothing from the article for the people that can't view it and at the same time didn't want to post the whole article- because that's annoying as well.

Nothing about the article was reasonable if you ask me:

......."Saves time: Cash tips do make your shift a bit easier by providing you with your own personal bank to make change from during your shift" "This saves you valuable time when there isn't a manager"

The server should be going to the cash register- don't they have to run the card transaction for the main portion of the bill? If the customer just used a card for the whole transaction, the server wouldn't have to make cash at all.

......."Gets them home earlier":
nope, would never work. I can't think of a time when your entire transactions for the day would be made in cash, especially not in 2011.

......."I never realized that some restaurants will reduce credit card tips by the associated credit card interchange fee. ":::...

Customers should not be responsible for whatever policies the restaurant has nor would customers have anyway of knowing which restaurant does what with tip sharing, credit card transaction fees, etc.

[NomoreDramaQ1015]

The server should be going to the cash register. I don't know why they would ever need to go to a manager

Where I worked the only register that was open was the Bartender's and only the bartender could use it. All the other register's were locked and you had to seek out the manager if you needed change.

Then they had to fill out forms stating what was taken out of the register and how much.

We were supposed to carry a till on us. Around $40 in small bills and various change is what I kept on me.

Only time I ever asked was when I needed to break a $100 or I didn't have anything smaller than a $5 on me.

[gooddecisions]

"Where I worked the only register that was open was the Bartender's and only the bartender could use it. All the other register's were locked and you had to seek out the manager if you needed change."

I could see that, but then like you said- you would still need to have that cash till regardless of how your customers paid. Needing your customers to tip you in cash to save you time would be inconsequential since you would still need to run the card for the main portion of the bill. Having the cash register on lock down like that would be a PITA. The whole time-saving arguement just did not make sense to me at all.

[stats45]

I know that a lot of people work at restaurants where the $4 (or whatever) plus tips isn't that much, but I was so happy when I got my first job waiting tables. I would bring home $600 - $800 a week in tips (all reported!) working about 40 hours a week. It was such a raise at the time!

Not claiming tips can hurt you later in life when you go to collect Social Security...

[Sum Dum Gai]

Yeah the time saving thing was pretty dubious sounding. If they pay with a card for the whole bill plus tip, you never have to make change which saves you time.

[NomoreDramaQ1015]

The whole time-saving arguement just did not make sense to me at all.

I agree with you, I was just saying not all serves have access to the register. Which I understood because when you got a full floor and seven servers the last thing you want is all of them dipping hands in the till untracked. It's just easier to unlock upon request and then you know exactly who took what.

Only time it saved me time was when the bus boy was an ass and I had to work a double shift. If I got all credit cards I couldn't pay him without having to find a manager with him hot on my heels.

As far as customers and table turnover credit cards are A LOT faster because I could just swipe and hand off the recipet and a pen. No having to track down a manager becasue someone gave me $100.

[zibazinski]

The only time I tip in cash is if I pay the whole bill in cash. DD is a server and her tips that are on credit card's are not discounted. I don't think a restaurant that did that would keep it's servers very long. They even give employee and their family's discounts for eating there so we do a fair amount. The food is good and they treat their servers well. PLUG for Cody's Roadhouse!!!!

[emma1420]

I try and tip in cash if a I can. I waited tables in high school and it was really nice to get paid everyday.

I will use a credit card if I don't have enough cash to leave a decent tip (at least 20% for average service, 25% for good service, etc.). But, I prefer to tip in cash if I can.

[zibazinski]

Servers get cashed out every night, why would you have to wait to get paid?

[Sum Dum Gai]

I will use a credit card if I don't have enough cash to leave a decent tip (at least 20% for average service, 25% for good service, etc.).

Not to pick on you specifically, but the thing that bothers me about the whole idea of tipping is that I don't choose restaurants based on the service anyway. I go to certain places because the food is great. In all honestly I should be tipping the cooks. All I want from the waitstaff is not bad service. Don't chit chat, kiss my butt, or interject yourself into my meal too much. Answer any questions I have, take my order, get my food to me, then stay available but out of the way. I came to enjoy the food, not the being waited on.

[jarhead1976]

Always tip cash..... If you think for 1 minute the government uses your tax money right, Think again. Most are struggling to make ends meet at $3.00 an hour and in school......... www.usdebtclock.org/index.html

[❤ mollymouser ❤]

I got my hair cut today. A nice lady waiting for her hair cut gave me a spare coupon and saved me $5 off the haircut, which I thought was very nice. I paid in cash. I tipped in cash. Why? Because I had the cash.

When we eat out, we usually use a credit card (which we pay in full.) Our tip goes on the credit card.... we don't usually carry a lot of cash with us, and I'm not interested in complicating our financial life.

[TheOtherMe]

I tip based on the service. If it's poor, I've been known to leave .25 to make my point. Of course, I will involve the manager before it gets to that point. Had a problem with an Outback serving me cold soup. They offered to heat it up in the microwave. Well, it was the french onion soup and the cheese is to be baked at the last minute, not heated in the microwave. I told them that and that the taste of the cold soup made me not want the soup any more. Manager came over and tried to get me to do the same thing. No way. Didn't even leave a penny that time.

I am a retired IRS agent who did a lot of studies at chains restaurants based on credit card tips. Those chains have to report as tips to the servers whatever is higher--the tips reported by the server or the % set by the IRS. The % takes in to effect tip outs to hosts, bussers, dishwashers, etc. This means that just because you tip in cash, the server doesn't pay taxes on it.

I have to pay taxes on all of my income, so why shouldn't they? Most of you do also.

[so1970]

i tip in cash it makes the server happy her honesty has nothing to do with me

[Deleted]

Mar 22, 2011 7:56:21 GMT -5 Lady Gaga Gaga Snerd said:

I will tip however i want. Sorry, i don't carry cash. So, either take my card or not. If not, tough luck, not my fault. And, when places start getting bossy about how i spend my money, then i will no longer be patron.

Snerdley,

I don't know who you are, but I find myself agreeing with you more and more.

[Deleted]

well.... I never

[dz]

I worked as a waitress through college, and I'm not going to lie, I didn't quite claim all of my cash tips. Mostly for the reason that we got paid $2.15 an hour. I basically got a 0 or $5 paycheck each week. If I had claimed all of my cash tips, I would have owed money. Being a server is hard work. Honestly. I know everyone has had experiences with waiters that were rude or just plain bad at their job, but for every one of those that you have experienced, a good waiter has experienced 50+ bad tables. Rude, condescending patrons who belittle you and treat you like their own personal slave. Tables of 15 teenagers who run you ragged, leave a huge mess, and each tip a dime. (Teenagers are the worst) People who eat all of their food, and then tell you when the bill comes that the didn't like it and they are not going to pay for it. Or, worst of all, people who dine and dash and leave you paying for their meal out of your tips. I definitely don't think you should HAVE to leave cash tips, but it definitely does make things easier on the servers. One poster above noted that it makes things easier when it comes to tipping out the busboys and food runners. The place I worked also had a tip jar for the cooks, and we all contributed to that on really busy nights. Many restaraunts also do not let servers leave that night with their cc tips. They cut a check at the end of the week with those tips, so servers don't get to leave with them that night.

[Clever Username]

Here's my suggestion.
Tip in cash. But use your credit card.
Plunk that cash into your water glass, place the credit card ontop, invert.

You've gottta really mix it up in these tip threads.

[ty]

Waiters and waitresses I usually tip if the service is good, but places like Starbucks, sorry, but what they charge to make a cup of java includes my tip. I think it's wrong for a lot of places to be putting up tip jars to try and make people feel obligated to give them extra cash for a service they are already paid a salary to do. Just like bank Ceo's, they don't deserve million dollar bonuses. They are already making upwards to 300k to half a mil a year already to do a job they are paid a salary for doing.
Save your money and give them a nice "Thank You" as a tip.

[mmkad4]

Dark Honor said, "Not to pick on you specifically, but the thing that bothers me about the whole idea of tipping is that I don't choose restaurants based on the service anyway. I go to certain places because the food is great. In all honestly I should be tipping the cooks. All I want from the waitstaff is not bad service. Don't chit chat, kiss my butt, or interject yourself into my meal too much. Answer any questions I have, take my order, get my food to me, then stay available but out of the way. I came to enjoy the food, not the being waited on."

Finally, someone with common sense and balls. I gave you karma, Dark Honor.

I know I will get some flak for saying this, but I think servers complain too much. They make decent money for running around carrying trays with food on them. Last time I checked, waiting tables did not require a college degree. If you wanna get paid as much, then go to college or get a more challenging job. Servers don't make the food and they don't make the drinks (and, in some restaurants, they don't even clean the tables). All they do is take my order, put it in and then bring it back when it's ready. Whoop-tee freakin' do! Some of them can't even do that right, but they still expect a tip. Although I understand it can be stressful when the restaurant is busy, it is not complicated.

When I was a teenager, I worked at a grocery store pushing carts outside (during the hot summer days and in the dead of winter -- try pushing 7 to 10 carts, in the cold, when the parking lot hasn't been plowed yet), bagging groceries (some people are very, very picky about how you bag their groceries), working the cash register and stocking shelves. It was hard work and I'm pretty sure I got paid much, much less than a server in a decent restaurant. I also worked at McDonald's taking people's orders and getting their food to them... minimum wage and no tips!

There is too much of a sense of entitlement when it comes to tipping in this country. A tip should be earned, not expected. It should be looked at as a bonus. As a result of this sense of entitlement, I avoid tipping like the plague. I try not to go out to eat too much (I enjoy cooking, anyway). Sometimes I'll do carryout instead (and, no, I don't tip for carryout. Are you kiddin' me! I don't have a money tree in the backyard). Like Dark Honor, I go to a restaurant for the food, not for the service. I couldn't care less if you made me put in my own order and/or grab my own food from the kitchen when it was ready. As a matter of fact, I'd rather do that.

That said, I also don't think it should be the customer's responsibility to pay the waitstaff a fair wage. It is the restaurant owner's responsibility! Expecting customers to fork over 20%+ for a tip is absurd. Although I have tipped 20%, it is very, very rare for me. I tip 15% for good service, 10% for okay service and 0% for lousy service. But, to be honest, most of the time I don't do it because I feel the server deserves it. I do it because it is expected.

PS: I grew up in a country where tipping is not the norm.

[AgeOfEnlightenmentSCP]

Mar 21, 2011 12:48:16 GMT -5 hoops902 said:

Nice, so make sure you tip in cash everyone in order to help people commit tax fraud!

Do you really feel personally responsible for your hair stylist's, or restaurant server's compliance with the tax code? Do you believe that if restaurant servers would just pay their taxes on that extra 1% to 12% of their income (they are REQUIRED by the IRS to report 8% of sales as tips regardless of whether or not they get stiffed, or actually are tipped) we could pay off all that debt we owe the Chinese?

Gimme a break.