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Wouldn't it be better to eliminate tipping altogether and then just lower the lower tax rates?
I fucking hate tipping culture. Most of the people I tip should be making a proper decent salary with benefits to boot.
Tipping culture puts consumers and customer facing employees at odds in favor of employers.
I'm actually kind of apposed to this. Unless, of course, you want to remove taxes for everyone at a given tax bracket.
But tips are wages. they should be treated as wages. if 40-50k a year in tips shouldn't be taxed, nobody making 40-50k a year should be. (I'm throwing out random numbers. I haven't a clue what the average yearly pay is of tipped workers, or what the highs and lows are; either.)
The other problem is that it opens up a crazy stupid loophole for people to accept payment as a "tip" instead of via a proper invoice.
Yes I see “He supports eliminating taxes on tips for service and hospitality workers while also raising minimum wage and preventing the wealthy from gaming the system.” "Service workers" is pretty damned vague. "Preventing the wealthy from gaming the system" is impossible, because that's all they do.
Not even the wealthy. Literally any service-based business would do this if their clientele would let them.
I have a buddy that’s a tattoo artist. He would absolutely charge $20 for materials, then request his hourly rate in tips. I could imagine all sorts of grey or black market work just becoming de-facto legal because someone is now a caterer, and their ‘tips’ can be banked without fear of IRS audits. (But also, how cool would it be if cookie dealers gave you weed if you tipped well enough?)
And then comes the questions - are tradespeople in the service industry? A plumber performs a service. Can an employer tip an employee? We’d sure find out, because someone would try it.
Excluding tipped jobs from minimum wage is one distinguishing factor (that we sound also get rid of, but..."States' rights!")
that would probably solve everything, along with having an actual, reasonable, minimum wage. (including, point of fact, tipping culture.)
But um. nope. the best they can do is, "oh we won't tax it." Milquetoast half-assed solutions are how we got into this mess.
Nobody that works on tips reports them for taxes. This doesn't change anything.
Cash tips, maybe. electronic tips that go through a PoS system have a digital trail, though, and that gets reported on w2's.
Hmm good point. I wasn't thinking about the electronic PoS tips.
Cash tips. You have to claim card tips kinda. In many places they're auto-claimed, and in others you don't "have" to but if the IRS wants they can get proof of those tips unlike cash (or weed) tips, so you could get fucked.
and then, they see that your receiving tips as a signifcant part of your income and start wondering why you only receive electronic tips...
and just for the record, failing to report something... that only pays off if you're a rich megacorp. normies just get thrown in jail.
They still have to prove it! They can suspect I'm lying but I've never gotten a cash tip in my life good sir!
eh. it's the IRS. they'll prove in time for lunch.
This is an awful policy. Want to give a tax cut to working people? Raise the standard deduction by a few thousand and bump up the taxes on the highest bracket by a bit (or preferably a lot). That will give a cut to untipped hospitality workers as well.
Why not both? And while we're helping the working poor, eliminate minimum wage exceptions for tipped workers altogether.
You don't need both. Raising the standard deduction will already remove the taxes on any tips (+ wages) made that are beneath the new deduction limit. It's just that everyone else who relies on wages will get the same benefit. I agree that minimum wage exceptions need to go.
Let's not address livable wages, let's stay distracted with meaningless shit like eliminating tax.
They addressed livable wages back in 2021. The answer was "lolno."
I said it in another thread but I have a bad feeling about this one. It seems like a way to give companies more of an excuse to rely on tips to pay their workers. How about instead we make the companies responsible for the tax on tips? That'll put an end to this miserable practice real quick.
I'm not a lawyer or politician but this sounds brilliant to me. If the company is responsible for paying taxes for any received tips, without being able to garnish the tips to pay it, then you're effectively putting more money in the hands of the staff but also making accepting tips over paying workers less practical. I love it.
for the 2% who actually claim tip income...
I was thinking this too, but then I realized I haven't done any of that kind of work in over a decade so I actually wonder how many more people pay with their cards now. I was always told you really shouldn't cheat when it's on a card since there is evidence, but you can always pocket cash no one knows you have.
More and more places put your tips on a paycheck too, so you can't "claim" you just get...
Are like Uber drivers and stuff able to lie about tips? Not sure how that works when everything is through the app and digital. Would've thought that they'd have exact documentation on how much you were tipped for the most part.
The Republicans would fillabuster it in the Senate, or some heritage foundation nutjob judge in bumfuck Idaho would block its implementation.
#VOTE OUT REPUBLICANS
Hate to say it but yeah, I don't see this making it to Biden's desk before his term is up. Or, if he somehow did manage to have a bill to sign into law, individual states would fail to implement it because "muh tax base" or some shit.
But it was Trump’s idea!
Hell in 2016 Trump was saying everyone making under 40K wouldn't be taxed, they'd just get a note from the IRS saying "you win!"
There's no reason for dems not to push this legislature to show people in red states that their representatives aren't on board with helping them.
I mean there is, that their own corporate benefactors would stop giving them money, but if they were just a little less beholden to the capitalist class, there would be no reason not to.
Ahh even better. Let them. Put them on display. Show the voters who they are.
Latest news, CEOs nationwide have generally volunteered to give up their salaries! And work entirely tip based for their services in whatever industry they are in...
Tipping needs to die, this will further cement it
Much needed reform. Truly one of the biggest problems of the republic.