So, I started working for a bar downtown in 2005, February exactly.
Our shifts were basically 10 PM - 4 AM. We made killer money, and by law (we were told), the three bartenders only HAD to claim 1/3 of credit card tips because that was all that was legally recorded.

Now, when I first started, I did NOT fill out a W4! Sounds kooky, I know, but I think it got "fudged" somehow. I did not fully realize this until months later. Long story short, when I did my taxes for that year, I got screwed, as did every other bartender there.

We all owed over a $1000! Some over $2000! WTF! Now, this year, I realized that my W4 claimed an incorrect number of exemptions, so I changed it. I didn't even raise a fit about my initial W4 being incorrect and (allegedly) forged.

Same shit this year. I owe CRAZY money to the IRS, even though my taxable income is crap. I think there was something shady going on in payroll. How can I look into this?

4/14/2007 4:35:43 AM

Have you talked to your boss or whoever is in charge of paying you?

4/14/2007 10:11:43 AM

also, did you get any real paychecks or were they all void?

because if you had enough tips claimed that most of your paychecks were void, that would explain why you owe so much money

4/14/2007 10:21:22 AM

do you not get a paystub so you can see how much was taken out for taxes?

i imagine this is probably correct though since you haven't been taxed at all on tips

i don't care enough to look up the law but i would imagine it's something like "you have to claim all credit card tips" and that you can get away with only claiming 1/3 of your cash tips because it's impossible to track - why should you only get to claim 1/3 of your taxable income when everyone else claims all of it

4/14/2007 10:25:16 AM

according to the gov, ALL of your tips are taxable income. every. single. bit. that said, they can only take taxes out of your hourly wage, which is probably what....$3.13/hour? so your paychecks have most likely been $0.

you didn't make enough hourly to make the taxes on your tips, and so now is the time you have to pay the difference. i know exactly how you feel. i work at sullivans, made killer tips, and now i just paid $1800 in taxes as as a result.

4/14/2007 10:52:07 AM

The W-4 determines how much money is WITHHELD from your pay check. If you didn't fill one out, NO money was withheld (or maybe a base amount is withheld, check your W2), which means you pay it all at tax time.

What did you think your tax REFUND is? Just free money? It's money that you get BACK that was WITHHELD.

If your W2 states though a bunch was withheld and you STILL owe a bunch, then you have to check things out.

[Edited on April 14, 2007 at 11:12 AM. Reason : ]

4/14/2007 11:11:22 AM

Quote :

"according to the gov, ALL of your tips are taxable income. every. single. bit. that said, they can only take taxes out of your hourly wage, which is probably what....$3.13/hour? so your paychecks have most likely been $0...you didn't make enough hourly to make the taxes on your tips, and so now is the time you have to pay the difference."

exactly, welcome to the world of tipped employees that make good money

4/14/2007 11:30:13 AM

the only way around being screwed with tips is if and only if your restaurant offers (and you qualify for) a 401k plan. then you turn in all of your tips at the end of the night, they take the appropriate taxes, and then they cut you a check every two weeks or so. this way, you can even get money back at tax time.

or, do what i do. since i don't work enough to do 401k, i put about $100 or so a month in a relatively high interest savings account so i won't be shocked when i have to pay $texas taxes at the end of the year. takes discipline, but it literally pays off.

4/14/2007 11:50:17 AM

Well, thank goodness I don't bartend anymore, so this will be the last time I have to deal with this crap.

I am more interested in why every other bartender making about the same money in the same environment is getting money back, and the poor sons a bitches who worked with me are paying.

We all just think there was something fishy with the accounting in the establishment (which was sold, BTW).

And I DID receive paychecks occasionally. I don't get it.

Quote :

""according to the gov, ALL of your tips are taxable income. every. single. bit. that said, they can only take taxes out of your hourly wage, which is probably what....$3.13/hour? so your paychecks have most likely been $0...you didn't make enough hourly to make the taxes on your tips, and so now is the time you have to pay the difference." exactly, welcome to the world of tipped employees that make good money"

I have worked for tips for nearly ten years, and only at this one establishment.

[Edited on April 14, 2007 at 1:00 PM. Reason : ...]

4/14/2007 12:48:34 PM

^ I meant...only at the one establishment have I had issues.

4/14/2007 1:25:08 PM

most restaurants make you claim 10-12% of your sales as tips

i work a couple lunchs a week just to make sure that I end up getting a paycheck rather than a void. if i just worked dinners, all my checks would be void and it would hurt come tax time.

4/14/2007 2:10:18 PM

Quote :

"The W-4 determines how much money is WITHHELD from your pay check. If you didn't fill one out, NO money was withheld (or maybe a base amount is withheld, check your W2), which means you pay it all at tax time."

No, dear....there was a W-4 filled out, but I didn't do it (that's the odd part). They were withholding, but not the correct amount.

I also held a salaried position, but I was paid out of another account so that I would receive consistent paychecks. They did not withhold enough from there, either.

I'm screwed anyway, but I want to follow-up on the shady accounting. I think one of the owners is a dirtbag and I wouldn't put anything past him.

4/14/2007 4:15:14 PM

What was your box 1 wages, your federal withholding in box 2, your filing status, and the number of exemption claimed on the W-4 and I will be able to tell you if there was in shady accounting?

4/14/2007 5:11:38 PM

other things come into account when calculating a refund. do the other employees who ARE getting a refund buy/own a house, donate something, etc? it's not all about income and taxes withheld.

4/14/2007 6:08:27 PM

Quote :

"I am more interested in why every other bartender making about the same money in the same environment is getting money back, and the poor sons a bitches who worked with me are paying."

They probably had more withholding. That means they gave the government interest free loans throughout the year. You had the opportunity to invest it with someone who pays interest instead. Sounds like a win for you if you're financially responsible.

4/14/2007 6:42:26 PM

Quote :

"They probably had more withholding. That means they gave the government interest free loans throughout the year. You had the opportunity to invest it with someone who pays interest instead. Sounds like a win for you if you're financially responsible. "

So if I get this right, you are saying that its best to do the least amount of withholding possible during the year to earn more interest on your "own" money. What about the penalty that is automatically calculated if you dont do enough withholding during the year? To me the financially responsible ones are the ones that do the proper withholding throughout the year.

4/15/2007 9:45:28 AM

hteres a difference between not witholding enough and witholding so much that you are getting thousands of dollars back at the end of the year.

4/15/2007 10:32:38 AM

Thats why I said proper withholding. Some people get thousands back while withholding nothing, what suggestion do you have for them?

4/15/2007 10:51:04 AM

stop being so poor or burdened.

4/15/2007 11:05:26 AM

Quote :

"Some people get thousands back while withholding nothing, what suggestion do you have for them?"

The tax man cometh. http://www.wral.com/news/local/video/1260389/

4/15/2007 5:17:47 PM