So I just wanted to throw this out there to see what you all thought of this situation. My current salon stopped letting people tip on their credit cards. So this means I can either tip with cash (which I so rarely carry) or write a check to my stylist of the tip. However, I can not pay at this salon for services received with a check. So either way I would have to pay with 2 forms of payment. And if I did have cash, it would likely be $20 from the ATM and I really dont want to have to ask my stylist for change to pay her. I wrote a letter to the salon owner expressing how this policy change meant that likely I would go to another salon that made paying more convenient and I regretted to do so. Today I got a response back from her..and it feels a little like she's passing the buck on this one. I can't see restaurants doing the same thing.
Here's her response...
"I am very sorry for the change. Businesses received notices at the beginning of April 2012 the IRS put into law all funds put through your credit card terminal will be reported to the IRS. If I continued with this, I would be responsible for matching employee taxes (FICA/MEDICARE) on their personal tips. I am a small business owner, and I cannot and do not want to pay taxes on my employee tips. This is part of the OBAMA Care shortage. FICA and Medicare just went up. I also lost my discount on unemployment, because of Kentucky's shortage in their unemployment fund. I really which things were better. I am extremely sorry for the inconvience. I have tried to find an answer to this, and I am still researching. I am sure ****** would rather keep you as a client with no tip, than for you to go somewhere else."
I would never go and not tip someone. I'm sure she wouldn't appreciate that either.