I was wondering if anyone knows how tips should show up on my paycheck? Or if they have to show up at all? I work at a small family owned wine bar and there is a lot of confusion about:

How tips show up on paychecks
If tips are taxed
how accounting knows what we were tipped each paycheck


If you could help me understand this (even part of this), I would appreciate it.

Thank-you, RaeGray

First of all, tipped employees are required to report all tips received (even if they come from a tip pool). The accountant can't guess. The employer can use any method they like; here is a form the IRS has designed which meets the requirements. You should keep a copy for yourself so that you can verify that your tips have been properly reported.
http://www.irs.gov/pub/irs-pdf/p1244.pdf

Here's how it works:

Cash Wages + Reported Tips = Total Gross
Deduct Taxes (so you can see that tips are subject to all payroll taxes)
Deduct involuntary deductions (child support, garnishments, etc.)
Deduct Reported Tips back out (I'm assuming you are receiving all your tips in cash, or that credit card tips are "cashed out" pretty much daily)
That's Net Pay

Your cash wages + tips must average at least minimum wage; if they don't the employer must make up the difference (assuming you are making a cash wage of less than minimum).

Does this help?

Yes that helps a lot!! Thanks for the information and have a good day!

Tracy:)