I’m guessing most of you already have your taxes filed and waiting on Uncle Sam to throw a dollar of two your way, from all that you’ve thrown HIS way. But…if you don’t, you’ve only got a few short weeks to get yourself in gear.
Being self-employed, I choose to give all my information to a CPA…someone that knows all the tax laws, and is the best one to keep us out of trouble and is able to keep us from paying huge fines. I don’t know much about those sort of things (taxes and insurance, I stay far away from), and am very grateful there are those that do.
In this blog, I would like to address a little know fact, when it comes to tips. Tips are looked at by the IRS as being income. It doesn’t matter if you are in the beauty industry or the restaurant business, or any other business that accepts tips. Uncle Sam expects (no, he demands) a bite out of every piece of bread that is headed toward our mouth. I have worked with a lot of people in my years of living…of which we won’t discuss…and continue to be amazed how easy it is to just not document tips. After all, they are gifts from those we serve. It says, “we appreciate the care you have given in the service you have provided for me.” Right? Right! Yet, our government says, “As a tax payer, you are required to give a percentage of EVERYTHING (sometimes twice…sometimes thrice), you receive.” And therein lies the kicker. For me, anyway.
I was raised to obey the laws of the land whether I agreed with them or not. A sense of pride came with the fact that we were not thieves, taking or holding back, what was required of others. And because of that, we could lay our head on our pillow (if we had one), at night…knowing we had done what was right. So because of that simple rule, I have never tried to hide my earnings from the government. Tips included. I remember one very dear client of mine from Oklahoma, that knew I was this way. As she was paying one pre-Christmas week, she looked me square in the eyes and said, “Mary, this is not a tip. I just didn’t have time to wrap this Christmas gift to you.” And that is how she kept me from recording that particular extra bit of money. She wanted me to have it all, and not just a percentage.
Now, just in case you’re thinking, “Well, I’ll just say that I never received tips, if I ever get audited, or questioned,” let me warn you. The type of return you file tells the government what you do for a living, where you work, who your employer is (if you have one other than yourself), and how much you should be reporting in tips. If there is any variation from that, you are targeted for review. Sure, there is a real possibility you can get by with some of that…but it raises a red flag with the IRS. Or so I’ve heard.
We can play hide and seek for only so long, when it comes to business. For me, I’d rather not come into question in the first place. And I know there are probably more than I realize those that are cheating Uncle Sam and his rules. My problem is this conscience that was instilled in me from the time I was only a wee little lassie. Actually, it all started way before I was born. God commanded us to “give to Caesar (the government), that which is Caesar’s (taxes), and to God (the One who redeemed us), what is God’s (the tithe).” Mark 12:13-17
When we come under the authority of the One that really matters, it won’t seem to matter so much what is required from a government we don’t agree with…because we’ll always have enough…and at times, possibly more than enough.
Forge on Passionistas!