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Comment by bigyabai | Hacker News Reader

It's also a joke, because anyone who's worked a service job knows there is no tax on cash tips (wink!)

Which made a difference 2 or 3 decades ago.

But today, who's getting tips in cash? Not many. Customers are paying for everything with credit cards or contactless, save for the occasional cash-only coffee shop or restaurant.

I should have specified that I live in the east-coast United States. Tap-to-pay is almost as common as someone writing you a paper check or an IOU, out here.

Saying east coast is too vague to be useful. I live on the east coast too and there are entire weeks where leave all my credit cards at home and only pay via tap-to-pay.

Contactless is basically non existent in America?

I know America has always been backwards (cheques were still in use well into the 21st century, card pins didn’t seem to catch on before contactless became a thing about a decade ago), but I thought contactless was quite high nowadays, especiallly with phones and watches.

Certainly I’ve had no problem paying contactless in the cities I’ve been to recently - New York, DC and Miami.

Keep in mind that inertia is a thing. Businesses used to have to make an impression on your card on carbon copy paper and physically send the slips in to be processed. When they started swiping cards, restaurants would only have one terminal and it had to be connected to a phone line to work. Both of these situations made it common for you to hand your card to the waiter (usually in the book they brought the check) because they couldn't do it at the table.

Credit cards caught on later in other parts of the world, and they benefited from having more modern options with regards to the equipment used. Governments and banks also did more to mandate the use of security features (chip & pin) than in the US - American banks like people using credit cards - it makes them a lot of money and they're incentivized to keep the barriers low as long as the amount of fraud is manageable to them.

Contactless is pervasive when there's counter service, but most POS systems in the US are still at a fixed staff station, and not one of the portable readers that the waiter can bring to the table. It's super weird, I agree (I was just in Guatemala, for example, and every restaurant had a portable reader they'd bring to the table), but I would imagine replacing POS systems again -- remember, we got chip card readers later than a lot of the rest of the world -- is annoying.

Table-service restaurants always take your card (Not sure if they support chip and/or contactless), but most other services support chip and contactless. (2025, NC). This wasn't true in my experience until a few years ago. We lag Europe by 5+ years on payment techs. E.g. chip, contactless. There's a coffee shop holdout near me that was magstrip only until a few weeks ago.

This was true five years ago, not true now.

When I eat out in NYC now they almost always bring the machine to your table so you can use contactless and you select the tip amount on the screen.

The other week I went to a place that asked for my card and brought out the receipt for me to sign and I had to manually calculate the tip and was struck by how long it's been since I had to do that.

Interesting! That was my experience in Europe even 10 years ago, but they haven't caught up in NC, Vegas, and the other US cities I've been to lately. Interesting hearing the NYC takes in this thread! Both cash, and modern chip/tap readers at restaurants, neither of which I see.

I heard this mess has to due to banks and CC companies (Visa etc) fighting over who implements the changes, while the system in Europe (and Asia, and South America...) doesn't have that division, so they get the tech mainstream fast.

i don't know why you'd think that. I don't live in a major metropolitan area and have used contactless payments for everything for the last 5-6 years.

Vet, grocery store, fedex/ups, pharmacy, restaurants, retail.

Because the op said

“ Tap-to-pay is almost as common as someone writing you a paper check or an IOU, out here.”

I.e rarer than hens teeth.

> But today, who's getting tips in cash?

Every server who waits on me.

I make it a point to carry cash and tip the waitstaff in cash even if I pay the bill on my credit card.

1) Tips on credit cards are a "dark pattern" meant to increase the house rake of the credit card handling companies.

2) Tips on credit cards are controlled by the owner and often never make it to the waitstaff.

I can short circuit this by giving my servers tips in cash.

This is easier to understand when you actually understand what the tipping law is. That tips may act as a credit towards an employee's wage (up to a max that's < 100%). How is the credit calculated? Besides video, the only hard proof is by whatever you write on that receipt.

So like you, I carry cash for tipping. I leave the tip section blank and write the provided total in the "total" line. Then I leave cash. Employee gets to decide if they declare or not (or in other words, if my tip may be credited towards their wage).

Same, but gotta acknowledge that few people do this still. A lot of businesses were even cash-only before coronavirus, now I see 0, at most they do a CC surcharge.

Sure, but I think you have to admit that tips have been moving more and more to credit cards, and fewer and fewer people tip with cash. You can keep doing what you do (and good on you for doing it), but at least acknowledge that the norm has been shifting for a while now.

> at least acknowledge that the norm has been shifting for a while now.

Sure. I agree it has been shifting, but mostly out of people simply not paying attention.

However, it's pretty easy to get it to switch. I have converted probably about 20% of my friends to doing cash tips simply by pointing out a single time that credit card tips have a significant chance of not making it to the server.

I haven't even pulled out the "credit card tips are a scam to increase the rake" angle, yet.

tbf it's one of the few times i try to carry cash.

I just don't trust management of places not to take a cut if it's done digitally.

> who's getting tips in cash?

About half of the large tips at high end restaurants in my town are cash. Sounds like it is about a third in New York. Especially if it is folks who work at a restaurant.

How is the trend? I imagine it’s already possible to estimate what year it will be almost zero from that trend. It also tends to accelerate: once a restaurant has very few cash customers they tend to become no-cash because the cost of cash handling is more than the potential loss of business. I’m unsure if there are any legal obstacles to going cashless in the US however. But where I live no one uses cash and more and more places are cash free (a chicken and egg problem).

> How is the trend?

Very stable, from what I can tell, though with significant regional variation.

> the cost of cash handling is more than the potential loss of business

High end restaurants will never be cashless. And you can cash tip at a cashless restaurant. The tip isn’t going to the business.

Wow. High end went cashless first of all here. Probably a decade ago.

But yes - cashless is obviously not w.r.t tips. But once a society is 99% cashless no one carries cash so won’t cash tip either.

Exactly. My girlfriend who works in sales (sells food) in LA barely gets tips in cash. Most people use their cards. And thus, her tips are tax deductible.

I have an honest question: what's the cash vs card tip ratio? 99.999% of the time I am not carrying cash and I don't see many (any?) people paying with cash ANYWHERE in the last 10+ years.

Almost no one can give you a good answer because it varies by business type and location.

My business does not involve tips (exactly) but I can tell you that I’ve seen anywhere from 20-40% of money run through my system being in cash, depending on where I am in the country.

NYC here, whole lot of cash still showing up in tip jars - there are still and loads of cash-only places around, from bars, restaurants, to street carts, you name it. JG Melon, for instance, is famously cash only. But so too is the bar around the corner from my apartment (Dynaco, do recommend).

...So people often tend to be carrying cash still.

Sure, but more places take card, and fewer people carry as much cash. Or rather, people carry less cash.

The fact that a business "famously" is cash only seems to support this, as that implies that it's becoming more unusual.

It’s certainly unusual for a famous restaurant to not accept cards.

Everything else is a crapshoot. If you don’t have cash you aren’t getting dumplings in Chinatown. And that’s just a bummer!

At this point you are litterally a sucker to pay for anything in cash, because everything is marked-up to cover CC fees, which you get a portion of back in the form of rewards.

Yes, I know some places give cash discounts. Most do not.

I pay tips in cash. There's technically no CC fees on that.

Not everything is marked up to cover CC fees, and any time there's a CC surcharge, it's more than the points you get. That and the tip is separate.

As the GP said, most places do not give a cash discount (the equivalent of a CC surcharge), though that practice is indeed a bit more common than it was a decade ago. Interestingly, I've see this practice in odd places like my utility and phone bills (they don't charge an extra fee if you instead link your bank account or use a debit card, which I don't love, but... here we are).

And even if things aren't marked up to cover CC fees, if you have a rewards card, you're effectively paying more if you pay in cash.

Idk. Where I live, it's very common. Almost every gas station does it, about half the restaurants, and yes every utility. 0 grocery stores though. The fee is at least 3%, and no card offers that level of cashback, though you might be able to do the equivalent of 5% with airline miles.

Cardholder agreements used to disallow CC surcharges, but I think such clauses were outlawed.

in SF I only carry cash for dive bars and the occasional mom n pop diner

When I worked as a waiter (many years ago), my pay check included tax withholding based on 8% of my tables for that pay period. This is driven by IRS rules: https://www.irs.gov/taxtopics/tc761#:~:text=If%20the%20total...

We had to declare our tips at the end of the night, and 10% was the lowest you could claim without needing manager approval. You can guess what everyone declared.

Haha, I had the same thought but now basically everyone is digital so I think its a different ball game than we are used to. At least as a restaurant server/bartender.

Sounds like those Americans aren't paying their fair share.

The negligence of their national responsibility will be felt like an earthquake by millions of Americans. It's hard to imagine how they live with themselves.

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