I own a local restaurant where we tip out our servers in cash every day. I’d like to go cashless but still tip out my servers daily. Venmo is the obvious solution thats free for all parties.
The Big Dilemma: Our servers claim their tips through our payroll software and I don’t want to change that. I don’t want Venmo issuing them a 1099-K OR for this to potentially open them up to any IRS hassles at all. I want it to be seamless, comfortable, and free for my crew.
Anyone have an experience with this?
Venmo has to issue the 1099-K under the law. You can’t get around that.
Your employees won’t get double taxed. The 1099 only means the info is being reported to the IRS. If your employees are reporting the income via their W2 and paying taxes on it, they are fine.