Originally Posted by rofly

When I was waitressing at a pool hall a decade ago and made $2.13/hr (selling mostly drinks, with limited bar food) the employer, a chain, reported tips to the IRS by some formula like 10% of the sales divided by the # of staff, or something of that nature. Even though I made less in tips than most restaurant waiters or bartenders, this 'reported' amount was less than half of what I actually made in tips. Maybe there are other ways of reporting tips to the IRS by the establishment, but I think the waiter comes out way ahead on the taxes. Of course, the waiter can be honest and self-report all his tips, but that never happens.