Mel Nichols, a 37-year-old bartender in Phoenix, Arizona, takes home anywhere from $30 to $50 an hour with tips included. But the uncertainty of how much she’s going to make on a daily basis is a constant source of stress.
“For every good day, there’s three bad days,” said Nichols, who has been in the service industry since she was a teenager. “You have no security when it comes to knowing how much you’re going to make.”
The amount tipped workers make varies by state. Fourteen states pay the federal minimum, or just above $2 an hour for tipped workers and $7 an hour for non-tipped workers.
I stopped reading after your first paragraph because there is so much wrong.
Minimum wage is federal law. If, as a tipped worker, at the end of a pay period, your base wage plus tips doesn’t make minimum wage, your employer must make up the difference. (I don’t know if states with higher minimum wages carry over this requirement, or if the employer only has to make up to the federal minimum wage.)
You are supposed to report all tips as income. Yes, most people will under-report cash tips, but that is tax fraud. (Again, this may vary for state taxes, but I’m not aware of any that say tips past minimum wage are tax-free.)
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