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Thread: Chauffeurs Gratuity

  1. #1

    Default Chauffeurs Gratuity

    I know this has probably been answered in a previous thread, but unfortunately i have not been able to find the answer so i apologize in advance.

    We have recently swithced from operating independent contractors to W2 employees and we pay our chauffeurs an hourly rate plus 20% gratuity. What is the proper way to report these wages? Is it just the hourly rate that should be reported on the W2 and the gratuity is reported another way? For some reason my payroll company cannot properly answer this qustion so i'm wondering if you can help.


  2. #2
    Super Moderator Limo Scene's Avatar
    Join Date
    Apr 2001
    Bakersfield, CA 93307


    You can report the total gross pay on a single line for the W2 because it was income for the employee and you should be taxing it on every pay period if you pay in through payroll. You need to break it out when reporting wages to your W/C carrier as tips are not allowed to be used when calculating your insurance premiums.
    Jim A. Luff
    Forum Moderator
    Contributing Editor & Consultant - LCT Magazine

    Limousine Scene - An Award Winning Company Since 1990
    Bakersfield, CA
    Limousines, Sedans, Vans, Charter Buses, Limo-Buses, Wheelchair Vans

  3. #3


    I think you need a new payroll company.

  4. #4


    Believe it or not, my payroll company is ADP, the largest in the country. Even worse is that they have been charging me for my workers comp policy based on the total income of the chauffeurs including their gratuity.

  5. #5
    Senior Member
    Join Date
    Jul 1999
    Los Angeles, CA


    I believe it.
    Karl Jones


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