| Rev. Rul 2012--‐18 indicates that, beginning in 2012, a stipulated "tip" typically added to the check of larger parties is a service charge, and not considered a tip. As such, the "service charge" is wages, rather than tip income and it is removed from reported tips and the related sales are removed from the calculations for purposes of reporting tips. In this project the cash flow effects and the tax burden are calculated for the server and the restaurant. |
Updated 02/21/2015