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    JKRhae's Avatar
    JKRhae Posts: 1, Reputation: 1
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    #1

    Nov 17, 2008, 02:49 PM
    Collecting Taxable Tips on Salary
    Is it against the law if someone is on salary, but working a job that collects taxable tips? Wouldn't the tips be required to be part of the Salary especially if they are also getting overtime?
    Wildsporty's Avatar
    Wildsporty Posts: 445, Reputation: 38
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    #2

    Nov 18, 2008, 04:14 PM
    Quote Originally Posted by JKRhae View Post
    Is it against the law if someone is on salary, but working a job that collects taxable tips? Wouldn't the tips be required to be part of the Salary especially if they are also getting overtime?
    You can be on salary and not be exempt. If you are being paid overtime and receiving tips than that person is on hourly pay paid in a salary method.

    You can pay a base salary to anyone but if the person is not in an exempt position they still must be paid the overtime. In some states you can use the tip as a tip credit for part of the salary, but it is not required that you do so. If you wish to pay the full base salary plus overtime and let them keep their tips than there is no law that says they cannot pay more than the required amount.

    Shirley
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