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My boss takes half my salary - how many taxes do I have to pay over my tips?


I'm a waitress in California its and make about $75.00 a day. I get in tips $10.00-maybe $35.00, so I earn a total of $75.00- 100.00 a day. How many taxes do I have to pay on my tips. My boss is claiming them, now my paycheck is about half of what is was.

Response Paywizard:
Thanks for writing us.

Tips are taxable according to the IRS. The information below is what the IRS wrote about taxes on tips earlier this year. The tax percentage depends on your annual income and your marital status. For example: if you're single and don't exceed the $31.850 annual mark, you pay 15% federal taxes (see paywizard income tax for overview).

The 50% percent your boss now exempts seems high, given your daily income of max $100,-. We advise you to ask your employer how the exemptions are built up - does he pay for pension, health care or other benefits for example? Easiest way to this is to ask for your W-2 form, which will state all taxes and other exemptions. 

For more information click on the next link: IRS tax tips or call the IRS: 800 829 3676.


  • Tips are taxable. Tips are subject to federal income, Social Security and Medicare taxes, and may be subject to state income tax as well.  The value of non–cash tips, such as tickets, passes or other items of value, is also income and subject to tax.
  • Include tips on your tax return. You must include in gross income all cash tips you receive directly from customers, tips added to credit cards, and your share of any tips you receive under a tip–splitting arrangement with fellow employees.
  • Report tips to your employer. If you receive $20 or more in tips in any one month, you should report all your tips to your employer. Your employer is required to withhold federal income, Social Security and Medicare taxes.
  • Keep a running daily log of your tip income. You can use IRS Publication 1244, Employee's Daily Record of Tips and Report to Employer, to record your tip income. For a free copy of Publication 1244, call the IRS toll free at 800-TAX-FORM (800-829-3676).
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