Waitress Gets $10,000 Tip on a $32 Bill, But One Week Later Gets a Nasty Surprise ( Employer fired her)

The Western Journal ^ | 17th February 2024 | staff

[Candor7]

Restaurant Boycotted,Benton Harbor , Michigan

[redfreedom]

In reading the story, there appears to be much more to it than what’s on the surface. There’s a good chance management had due cause to can her.

[Jonty30]

The story seems simple enough. She got a big tip and the restaurant had to pay taxes on that tip, so they fired her.

[fwdude]

There’s almost always a lot more to these stories than is suggested.

[Retain Mike]

“had nothing to do with the tip. She did receive the entire tip, she did not pay taxes on it (the business did). Yes, she shared the tip at the request of the man that left it.”

So why does the business pay the tax?

[eyeamok]

Yet they give no reason for firing her except that the tip is “part of the story”?? Why not tell us why then?

[Codeflier]

She shouldn’t have posted about it on social media! Diving further into this, it seems that there was a dispute over the taxes. That for whatever reason, the restaurant had to pay the taxes on it, rather than coming from her tip directly.

Either way, it seems like there is more to this than restaurant bad, employee good - as is presented here.

[PeterPrinciple]

“When something this big happens, people act certain ways and if there’s issues with somebody to begin with, this can cause it to be even worse,” Cousins said. “And then it all just kind of blows up.”

---

any thoughts on the scenario?

[Jonty30]

That’s my question.
Whomever earns the money should pay the tax.

[PeterPrinciple]

Free money NEVER does anyone any good. Invest in people, choose wisely.

[mewzilla]

This may have something to do with Michigan’s tip credit...

https://www.nolo.com/legal-encyclopedia/michigan-laws-tipped-employees.html

[z3n]

So why does the business pay the tax?

~~~

Because it was a credit card transaction, so the funds hit their bank account, and it’s taxable revenue.

What i don’t understand is why the restaurant had to pay her the full amount. The restaurant received the funds into their merchant account. They could have withheld tax.

[Fresh Wind]

So why does the business pay the tax?

That's because double taxation is the American Way. /s

[HartleyMBaldwin]

Because it was a credit card transaction

Well, that convinces me. Next time I tip $10,000 I'll use cash.

[alexander_busek]

Whomever earns the money should pay the tax.

Agreed.

Regards,

[Tennessee Nana]

She doesnt need the job

Get some training with that $10,000 and get a better paying job...

[gitmo]

They fired her because of the actions of one of their customers.

[Mr. Lucky]

Ummm, if the restaraunt had to book the tip as gross revenue, the payout to the employees would have been deductible.

Something doesn't make sense here.

[Candor7]

I agree....boot heels down the road! Linsey Boyd can do better:

[Yo-Yo]

I have no idea why she was fired, and it could be that attitudes and jealousy were causing a hostile work environment.

As for the business paying the taxes, the IRS requires that businesses withhold income tax on tips just as if they were wages. I don't know if businesses are also required to pay the employer half of Social Security taxes on tips, but that may be the case and the business asked that the waitress reimburse them for their half of the SS taxes on $10,000.

Otherwise, the business would have to pay Social Security taxes on 'wages' (tips) without a corresponding income stream.