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Does son(waiter) have to pay IRS tip wages quarterly

17 years ago

My son got a job as a waiter at a very nice restaurant and makes very good tips. I know he will be taxed on that at the end of the year and probably owe money-but somebody said they have to pay the IRS quarterly not yearly. How do I find out if that is correct or not?

thank you

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Comments (7)

quiltglo
17 years ago
Not quarterly, but every paycheck. If he receives a regular paycheck from the restaurant it is his responsibility to claim his tips through them. Much easier to claim them at the restaurant. Every one of the restuarants I've worked for were very helpful in regards to how to claim the tips. He should be having this taken out each pay period, not the end of the year. The IRS can ding him for not having enough withheld (I realize that common practice to not withhold enough.) Most likely the restaurant will hold out enough to at least pull him up to minimum wage. Our state min. wage is higher than the national and my son's employer claimed $4 per hour in tips, so he ends up owing very little at the end of the year. Seems like all my paycheck was good for was paying those taxes.

Gloria
Chemocurl zn5b/6a Indiana
17 years ago
I am to estimate and make tax payments on income that is not taxable when I receive it.

Example...dividends, and farm rent. I receive the packet of forms and envelopes to pay them quarterly, but my tax person told me as long as I pay the estimated tax b4 the end of the 4th quarter, there will not be a penalty. The end of the 4th quarter is Jan 15th.
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This was a chain restaurant, & the bill for 2 dinners was just under $40. Servers in those places aren't "professional" waiters who are likely to make good incomes. They're likely young people trying to support themselves or pay school expenses. "Professional" waiters work at places where dinner for 2 would be $150 or more, & where no diner would dare leave a chintzy tip. which has...what?...to do with punishing a harried waitress for forgetting or not realizing that she should have brought smaller bills.
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quiltglo
17 years ago
But OP is referring to her son, who is an employee. Employee wages don't have anything to do with quarterly stuff. It's his responsiblity to claim all of his wages (which includes the tips), so why wait and take the hit at the end of the year? Less painful to do it as you go.

Gloria (who spent way too many years as a waitress)
sportsmom12
Original Author
17 years ago
I guess because he gets tips his base pay is like 1.25 an hour so even if they take taxes out- there is a big gaps between what he makes and what they can take out. Of course my son is Mr. Irresponsible and wouldn't do anything intelligent like actually ask his company. All he told me is they make him fill out a tip sheet every night. I am sure his restaurant turns that in at the end of year as salary- and I am betting he will owe quite a bit-but I wasn't sure how to make him pay through the year
Thanks for all your notes
azzalea
17 years ago
I'd really recommend letting your accountant handle this. When DD was a waitress, I gave up. The forms and regs were so complicated that it was well worth the money to just turn it all over to our accountant. And I'm sure the system hasn't simplified in the past few years. It won't cost that much--just send him to the right professional, and you'll know it's done right.
quiltglo
17 years ago
Good idea assalea. DH is a CPA, so I don't bother with it anymore, but I made him show me DS's return and we were looking at which box the taxes were recorded on the W-2. Of course that made the big difference in if Social Security had been held out or just federal taxes (we don't have a state income tax here.) Of course, he then had to go off on some tangent about IF there were trusts, yada, yada, yada. The man drives me crazy. All I asked was a simple question since he's only dealt with DS for the past few years.

Gloria
lyfia
17 years ago
Could your son average out his tips and get an approximate amount from that which would go to tax and then ask his employer to take out that extra amount. I have to do that as my employer doesn't take out enough even with me as married tax at single rate.

Also might want to check his paycheck as they may be smart and already take out the tax based on the sheet they have to fill out. My best friend gets tips and that is what the place she works for does.

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