QUESTION
is it legal for my employer to deduct claimed tips from my check?
Asked on May 12th, 2014 on Labor and Employment - Indiana
More details to this question:
After clocking out there is a reauirememt to claim tips. I input the amount I've made so it will be taxed, at least thats what I thought. However, my paystub shows that the tip amount is being deducted from the hourly wages I've earned. I thought that the tips were only supposed to be taxed.
1 ANSWER
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The short answer to your question is "No." Your employer cannot deduct tips from your wages. Those tips are yours, you earned them, and they must be reported to the IRS for tax purposes in addition to your hourly wage. Your wage and your tips must add up to the Federal Minimum Wage of $7.25 per hour for your employer to claim "Tip Credit."
Additional information regarding "Tip Credit" can be found on the U.S. Dept. of Labor Website by clicking here.
Answered on May 16th, 2014 at 11:25 AM