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Options for tipped employees, receiving a tip credit, who are forced to give 30% of all tips to kitchen staff- including the owner when she's the cook

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kjane79

New member
What is the name of your state? Nebraska
I have been employed at a small town coffee shop/eatery for the last 4+ years. I work 3 days during the week from 6:30 am until 3 or 4 pm. Besides opening the restaurant everyday (alongside a cook) I am also the only employee in the front. Besides being a restaurant with a full menu for breakfast and lunch, we are also a specialty coffee shop and an old fashioned ice cream parlor. That means not only am I the only waitress, I am also the only barista, as well as a soda jerk when necessary, the busgirl, and the cashier. Everyday I have to seat customers, take their orders, make their drinks, (including lattes, cappuccinos, brevés, shakes, malts, smoothies, etc), deliver their food, figure their checks, clear their tables, and cash them out at the cash register. We are not a huge restaurant with 9 tables that seat 4 each, and an additional bar area that can seat up to 8 more, but we do have 2 additional seating rooms upstairs that are often booked ahead of time for company meetings etc. And this is just during breakfast. At 9 am we have a dishwasher that comes in everyday. In the summertime when we are even busier, one of the highschool kids will come in at lunch time to work with me. There are days that I definitely appreciate an extra body running around, but usually it just makes more work for me because I have to also do their jobs in order to make sure customers are taken care of properly. The point I'm trying to make is that I work hard. For all my hard work, I am paid $5 an hour and have been since I started. (Minimum wage for tipped employees in Nebraska is $2.13 so why am I complaining?) I am supposed to be provided with a meal for each meal shift i work- so I should get breakfast and lunch every day. This does not give me access to the menu items. I am usually offered toast or a single pancake. Not a meal. I am never offered lunch. If I want something to eat(I usually just skip it) I get it myself. Now for the tips. We have a shared tip jar that all the tips go in. After breakfast they are divided up- preferably by me- but sometimes the ow ner takes the jar and does it out of sight-the back gets 30% and the rest is divided up front. 10% goes to the dishwasher and 20% to the cook- which includes the owner on the days that she is the cook. Those 2 positions are not paid minimum wage- so the tips are supposed to get them up to where their pay is supposed to be. As if all of this isn't bad enough, 2 years ago, my employer informed us (wait staff) that he was switching us from employees to independent contractors and would no longer be taking taxes out of our checks. I wasn't able to even file a return 2 years ago to report my income because I was never provided with a 1099 to send in. I missed out on an $8000+ tax return. Last year I just kept a record of all I was paid and filed with a 1099 I made myself, but it was rejected so there is another $7000 I missed out on and I'm not sure where to go to from here. I loved my job and I liked the people I work for, but lately it's become blatantly obvious that I'm just a cog in their dirty dirty wheel and I'm tired of it. Do I have any chance of getting back some of my lost wages at least? Invite greatly appreciated.
 


kjane79

New member
What is the name of your state? Nebraska
I have been employed at a small town coffee shop/eatery for the last 4+ years. I work 3 days during the week from 6:30 am until 3 or 4 pm. Besides opening the restaurant everyday (alongside a cook) I am also the only employee in the front. Besides being a restaurant with a full menu for breakfast and lunch, we are also a specialty coffee shop and an old fashioned ice cream parlor. That means not only am I the only waitress, I am also the only barista, as well as a soda jerk when necessary, the busgirl, and the cashier. Everyday I have to seat customers, take their orders, make their drinks, (including lattes, cappuccinos, brevés, shakes, malts, smoothies, etc), deliver their food, figure their checks, clear their tables, and cash them out at the cash register. We are not a huge restaurant with 9 tables that seat 4 each, and an additional bar area that can seat up to 8 more, but we do have 2 additional seating rooms upstairs that are often booked ahead of time for company meetings etc. And this is just during breakfast. At 9 am we have a dishwasher that comes in everyday. In the summertime when we are even busier, one of the highschool kids will come in at lunch time to work with me. There are days that I definitely appreciate an extra body running around, but usually it just makes more work for me because I have to also do their jobs in order to make sure customers are taken care of properly. The point I'm trying to make is that I work hard. For all my hard work, I am paid $5 an hour and have been since I started. (Minimum wage for tipped employees in Nebraska is $2.13 so why am I complaining?) I am supposed to be provided with a meal for each meal shift i work- so I should get breakfast and lunch every day. This does not give me access to the menu items. I am usually offered toast or a single pancake. Not a meal. I am never offered lunch. If I want something to eat(I usually just skip it) I get it myself. Now for the tips. We have a shared tip jar that all the tips go in. After breakfast they are divided up- preferably by me- but sometimes the ow ner takes the jar and does it out of sight-the back gets 30% and the rest is divided up front. 10% goes to the dishwasher and 20% to the cook- which includes the owner on the days that she is the cook. Those 2 positions are not paid minimum wage- so the tips are supposed to get them up to where their pay is supposed to be. As if all of this isn't bad enough, 2 years ago, my employer informed us (wait staff) that he was switching us from employees to independent contractors and would no longer be taking taxes out of our checks. I wasn't able to even file a return 2 years ago to report my income because I was never provided with a 1099 to send in. I missed out on an $8000+ tax return. Last year I just kept a record of all I was paid and filed with a 1099 I made myself, but it was rejected so there is another $7000 I missed out on and I'm not sure where to go to from here. I loved my job and I liked the people I work for, but lately it's become blatantly obvious that I'm just a cog in their dirty dirty wheel and I'm tired of it. Do I have any chance of getting back some of my lost wages at least? Invite greatly appreciated.
* Incite not invite
 

LdiJ

Senior Member
You do not need a 1099-Misc to file an income tax return. You just needed a good record of the income you earned. The return that you did file was rejected because you made up a fake 1099-Misc. Making up a fake one made the IRS think that you were filing a fraudulent tax return.

What you need to do for 2019 taxes is to file a return showing the income and tips that you did receive. You will file the income using form 8919. You will also, separately need to file a for SS-8 with the IRS to have them declare that you are being misclassified by your employer as an independent contractor. They IRS will investigate your employer (it will take some time) and your employer will eventually get slapped with penalties and will have to stop treating employees as independent contractors.

You also need to be looking for a new job. Most employers don't pull the kind of illegal stunts that your employer is pulling unless they are having trouble staying in business.
 
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FlyingRon

Senior Member
Here is a helpful page on tips for employees courtesy of the IRS: https://www.irs.gov/businesses/small-businesses-self-employed/tip-recordkeeping-and-reporting

The owner is NOT allowed to retain tips as described, nor should they be "tipping out" the kitchen staff (be it themselves or anybody else). You may file a federal complaint here: https://www.dol.gov/agencies/whd/contact/complaints
or with the state here: https://dol.nebraska.gov/LaborStandards/WageComplaint/WageComplaintForm

As LdiJ points out you can also file complaints on the mischaracterization as independent contractors (which you aren't in the least). The SS-8 have the feds make the determination that you are indeed an employee, the 8919 will allow you a credit for taxes that the employer should have paid (you'll still be obligated to pay the taxes they didn't withhold that were otherwise due).

Nebraska has their own independent contractor rules that your employer is violating, you can report that in the WageComplaint form above as well.
 

Chyvan

Member
What you need to do for 2019 taxes is to file a return showing the income and tips that you did receive.
What about amending the prior year returns? Can she also get back the "employer" portion of her FICA if the IRS reclassifies her or is that only on a going forward basis?
 

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