Effective Jan. 1, 2014, the Internal Revenue Service (IRS) will recognize automatic gratuities, a percentage automatically added to a restaurant bill, as a service charge, rather than a tip. The IRS ruling on automatic gratuities isn’t new. This was the result of a June 2012 tax ruling that was delayed to give restaurants and related businesses more time to comply.
Continue Reading Think You Are Leaving a Tip After a Nice Meal, Think Again; You May Be Leaving Someone’s Wages – IRS Ruling On Automatic Gratuity Begins January 2014
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Settling Employment Law Claims: You, the Employee,…….and the IRS?
By Labor & Employment on
Posted in Labor Law, Wage & Hour
Many of our employer clients and their in-house counsel recognize that most of the claims paid in an employment settlement are taxable income for the employee. Employers therefore, wisely require that at least some of the settlement payment to the employee be made in the form of a payroll check, with…