Taxing Tips
- Thread starter HALL85
- Start date
No tax on tips and no tax on IT are two of the most stupid financial moves ever. First, people who get tips don’t report most of if any tips. It’s an underground economy. Waiters at fine restaurants can earn 6 figures And that will be tax free? They don’t report cash tips at all and are getting a break. I’m sorry, u earn money from your job and you get taxed. Whether it be from tips or OT, it should be taxed. He’ll, there are jobs where OT comprises the majority of someone’s pay. It’s absolutely ludicrous to even propose this.
I guess you both agree that Trump raising taxes on super rich would be brilliant because you didn’t comment on it.
My sense is cash tips have diminished greatly between use of credit card and pay apps. How many people actually pay cash in a restaurant these days? I’m a dinosaur and probably pay with cash 10% of the time. One thing I will do though is tip the server separately from the bill, but most people don’t do that.
And think of the generational change. My kids are in their 30s and lucky if they have five dollars in their wallet.
This is obviously for optics more than anything else.
And think of the generational change. My kids are in their 30s and lucky if they have five dollars in their wallet.
This is obviously for optics more than anything else.
I agree on the tips part. The FICA tip credit has been in place for years and is an incentive for businesses to report as much tips as possible. As Hall85 said the use of cash has greatly diminished. The bigger issue than cash tips is the cash workers at your restaurants, landscapers, cleaning services, etc. where cash sales and payroll are not being reported. We're talking about peanuts when it comes to cash tips compared to the other cash not being reported.
I am in favor of no tax on OT. I'm sorry we are seeing the laziest generation in the history of America entering the workforce. I have no problem incentivizing people to work more. Maybe there's a better way than no tax on OT, but right now there's nothing better than it on the table. Maybe if there's no tax on OT, 1 parent could stay home and raise kids again. I think that would be a good thing.
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No tax on OT is a disaster. For example, a Port Authority police officer’s base pay is like $100k. They can easily double that pay through OT. Longshoreman’s base pay is 85k, But they earn most of their salary which can be $300,000 or more through OT. This would be an absolute travesty to allow that to happen. You earn money and you get taxed on it. Everyone treated the same.
Everyone’s not treated the same based on the tax code. If that’s what you believe there should be a flat tax. A guy making $200k of capital gains pays way less than the guy making 200k working as an officer
Flat tax is the way to go but politicians will never do that because they get a lot of campaign contributions for pushing for tax legislation like carried interest.
Nope, been here forever saying less taxes and less spending. Where are you on the recent CR that doesn't reduce spending?
So funny that people want the same for everyone. I tell people all of the time, the government will take your money. If you want to pay 30% on a capital gain they will gladly take it. It's amazing how the self righteous want to follow unfair laws that benefit them.
Everyone who earns money throught their job is taxed Income based upon investments is treated differently Now, you want capital income to be taxed the same as regular income , there is an idea. But, not sure that really works. It certainly would mean more revenue for the government. The richest Americans would certainly pay their share at that point. Maybe that’s what should happen.
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So you're ok with investment income being different, but you're not ok with overtime income being different. I just don't get why the line can be drawn between investment income and working income, yet there's a hard no on OT income.
Earned income vs investment income is the line.
OT is earned income and should be treated as such. Carving overtime or tips out is ripe for abuse.
SMH. Ripe for abuse. Half the system is an abuse. Just look at these pass through taxes that small business owners get to use pay their taxes and get a deduction for them. How about the QBI deduction. Employer pays taxes on 80% of his or her income while the employee pays taxes on 100%. Employer gets a break on his earned income. But give the employee an advantage…no no no. Can’t do that.
I get the pass through tax and the QBI deduction are good things. I'm just saying the line isn't earned vs investment because there's work arounds for many people.
QBI deduction was added because C corp rates were decreased significantly in 2017. They needed something to level out the tax rates a bit for smaller companies. They weren't getting a "break" as much as they were getting relief offered to C corps.
But is the answer to loopholes to create more?
Relief offered to C Corps. Yes we should be worried that the C corps who have double taxation don't get better rates.
You call them loopholes, I call them incentives. But there's plenty of incentives that give business owners advantages over the employees. I'm just not going to cry that an employee gets a break.
OT is already an incentive. If a company isn't paying high enough OT for it to be a proper incentive, then that's up to the employer to figure out.
Police work a tremendous amount of OT because it is incentivized for them to do so. They don't need to pay less tax for the incentive.
I have no problem rewarding the hardest working Americans. Sure seems like a democratic position of the 1960s and 1970s of taking care of the working class.
Lets just get rid of income tax for them then altogether. If you work 45+ hours per week. No income tax at all.
That better?
With a national sales tax on everything, where you can control how much tax you pay? I'm not against it.
Sure doesn't like you're for a middle ground to help the working class. Income tax on everything or nothing. Maybe you want more tax savings for the business owners only.
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A regressive tax where the hard working poor / middle class Americans have to pay a higher percentage of their earnings on taxes and discourages consumption which drives our economy? Pass
yeah somehow states are surviving without income tax and doing ok on sales tax. Must be filled with people making 200k and up all around.
Not sure how serious or practical it is, but I saw something bandied about recently about Trump floating no income tax on income $150,000 or less. This would be a boon for the economy and the middle class. Huge incentive to work and more money in people's pockets.
Well the argument is that investment money has already been taxed. Capital gains is to incentivize investment which drives our economy. But I have no issue that over a certain amount should be taxed at regular income say anything over $1 million a year.
But OT should be taxed.
the people working OT drive our economy just as much as investment does in my opinion.
How many people work over 40 hours a week and don’t get OT? Why should a police officer not only receive OT and then have it not taxed. Meanwhile, the assistant prosecutor who makes a lower base pay and works over 40 hours a week does not get OT.
I fundamentally disagree with you. This would cause a huge shortage in tax revenue and where do you propose to make it up?
With LESS spending. The rest of the country pays taxes and ends up with less money to spend. We all figure it out. How about the government figure how to do what the rest of us have to?
So the people in the 150-200k range would actually be losing money by their raises. people will be gunning for a demotion
but more so everyones contracts will be revised to take advantage of loopholes
I would assume the person you’re talking about wouldn’t be taxed on the first 150k. They would only pay tax on the next 50k. Our government is stupid, but not that’s stupid
my bad. figured this was to benefit the working class not everyone in america. which no tax on first 150, while follows the current tax structure, would benefit everyone.
Flat tax is not necessarily one rate for all.Forbes proposal had carve out of first 36k of income no tax ( would be inflation adjusted for today comparable level).You could then have a couple of rates above that e.g. 10% up to X etc. to achieve the targeted revenue generated.If you only have one or two deductions e.g charity and home mortgage interest you can set the rates to achieve the desired revenue.Control of spending is the bigger issue.Unless we get agreement on spending limits the debt will never be eliminated.A simple agreement to limit government spending to one percent less than prior year GDP would eliminate debt over number of years I.e. if GDP increases 3% in a year next year government spending can only be 2% higher than prior year spending.
If you don’t want spending limits you really are not serious about solving debt crisis.
If you don’t want spending limits you really are not serious about solving debt crisis.
So a standard deduction plus a graduated tax rate?
Are you not describing our current tax law?
I am not in favor of arbitrary limits. I'm in favor of spending when needed and cutting when it is not needed.