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I was watching Reservoir Dogs earlier today, and prompted by the discussion on tipping in the movie, had a thought I'd like to pursue purely out of curiosity. I was wondering if somebody more knowledgeable might be able to point me towards the relevant IRS documents regarding taxation on tips to help me understand the following query.

My question is this: What is the rational for collecting income tax on tipping? If a waitress serves me at a restaurant, she is considered an employee of the restaurant rather than an independent contractor, correct? Thus, wages gained through the employer should clearly be subject to income tax...but what about transfer of money directly from me to her? If I decide to give the waitress, directly and purely out of goodwill, an extra $10 above and beyond 15%, why should that be taxed rather than considered a gift subject to the $12,000 non-taxable gift limit? What if (creepiness factor aside), I wait outside the restaurant for the waitress to finish her shift and then give her $10. Is this considered a tip and subject to taxation?

I'm not proposing or advocate anybody try to avoid taxation with this argument, I just thought it would be interesting to start a discussion on the rationale behind this part of tax law, especially considering the knowledgeable and friendly denizens of the board.

A second follow-up question also is raised by this post: I'm asking for references to IRS Tax Documents to read for fun and out of intellectual curiosity. What is wrong with me? :-)
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