Yet another tipping thread: Debit machine vs giving cash

[Red Squirrel]

When you pay for something through a debit machine, whether you use debit or credit card, and it asks you to tip, do you still prefer to give cash? Has anyone worked a job where you are the one getting tipped, is it better when we give cash or when we do through machine?

I always feel that if I do it through the machine they probably have to claim tax on it or something, is this the case, or do they still get the tip right away as cash without it showing up anywhere?

 

[Ns1]

Cash tip = unreported income

 

[BoomerD]

NS1 is right...but it often doesn't matter...

Allocation of Tips
As an employer, you must ensure that the total tip income reported to you during any pay period is, at a minimum, equal to 8% of your total receipts for that period.
In calculating 8% of total receipts, you do not include nonallocable receipts. Nonallocable receipts are defined as receipts for carry out sales and receipts with a service charge added of 10% or more.
When the total reported to you is less than 8%, you must allocate the difference between the actual tip income reported and 8% of gross receipts. There are three methods for allocating tip income:
Gross Receipt Method
Hours Worked Method
Good Faith Agreement

The employees are still taxed on tips they SHOULD be getting, based on receipts.

BUT...back to the original question...

For me, it depends I prefer to tip with cash...and write "Cash" in the tip section of the charge receipt. BUT, sometimes, it's just easier to pay the tip with the card...

One other thing to consider, some restaurants subtract applicable credit card charges from the tips paid by card...

 

[lxskllr]

I always tip cash. Well, cash is all I use anymore, but even when I used cards, I still tipped cash.

 

[mrjminer]

I tip cash when I have it on me. If I know I am going out to eat somewhere in advance, I usually take a minute and look for some cash I can use as a tip. I'd say I end up about 50/50 cash or credit