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PaperclipPerfector  3mo ago (text post)   30112 thread views

Culture War Roundup for the week of August 12, 2024

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Yes. Cash tips get audited quite frequently. Along with the restaurants themselves.

Cash tips get audited quite frequently.

By what mechanism?

IRS sees you work in a service coded sector. They check your tip box. If its empty they get super suspicious. If its filled out their database compares your number to everyone else in your area and flags those that appear low. Those get assigned a case agent who sends you a threatening letter asking for proof of your reported number matches. You have none cus you're a lying liar who lied and got caught. Now they are looking at your bank statements for 3 years and eventually you enter some payment plan to pay back the last 3 years of tip fraud you committed.

You have none cus you're a lying liar who lied and got caught.

But in reality I have none because no one has any proof about cash tips, right?

Now they are looking at your bank statements for 3 years

To what end?

pay back the last 3 years of tip fraud you committed

So basically they just assume that I made the average tip amount in my area and calculate the fraud based on this?

It seems like the difference between my reported amount and the average must be very high for this method to be of any significance. If I work at an unpopular bar my tips might be 3x less than the average without any tip fraud whatsoever.

But in reality I have none because no one has any proof about cash tips, right?

There is cash deposited in your bank account. Wheres that from buddy? The other bartender at your bar reported $20k in cash tips and you reported $0.

Or maybe you are unbanked, but also somehow pay $1000 in rent and $500 in car payments every month while reporting $500 in income. Sus sus.

To what end?

To see all the cash you deposited.

So basically they just assume that I made the average tip amount in my area and calculate the fraud based on this?

Thats where they start. Then they dig.

It seems like the difference between my reported amount and the average must be very high for this method to be of any significance. If I work at an unpopular bar my tips might be 3x less than the average without any tip fraud whatsoever.

Of course. But because you are stupid and a bartender at a shitty bar, your reported a ludicrous amount that no one could possibly believe because you think you are smarter than the system.

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