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Reply to "So it’s 22% tips now"
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[quote=Anonymous][quote]The restaurant holds back 3 percent, sometimes takes a cut if tip back of house employees, then takes SS, UI, Disability, state and local etc. then if kid in college income gets deducted off financial aid if student income to high. [/quote] In many areas, restaurants have to eat credit card fees on tips. And the 3% fee would be 3% of the tip amount (so a 20% tip becomes a 19.40% tip), not 3% of the bill, anyway. Tip deductions for back-of-house employees are determined by the restaurant and would apply to both cash and credit card tips. In the US, all tips are taxable, regardless of payment method.[/quote]
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