Mandatory Tips Are Off the Menu

November 1, 2013 – In The News
Kiplinger’s Personal Finance Magazine

Carolyn D. Richmond was featured in the Kiplinger’s Personal Finance Magazine article “Mandatory Tips Are Off the Menu.” While the full text can be found in the November 1, 2013, issue of Kiplinger’s Personal Finance Magazine, a synopsis is noted below.

Mandatory tips added to customers’ bills are on the way out, thanks to an IRS ruling that takes effect in 2014, classifying automatic gratuities as service charges, which are treated as wages rather than tips. Customers will more likely see suggested sample gratuities on their bill, leaving the final amount to their discretion.

Policies are likely to change elsewhere, too. Carolyn Richmond suspects that overnight guests and bar and banquet hall patrons will also see language that strongly suggest gratuities but doesn’t impose them.