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Hundreds of Las Vegas hospitality workers protest after IRS deducts more tips

Las Vegas workers protest IRS tip rate
Posted at 8:21 PM, Mar 24, 2022
and last updated 2022-03-25 01:55:24-04

LAS VEGAS (KTNV) — Hundreds of hospitality workers protested outside the federal courthouse on Thursday after the IRS raised tip allocation rates — which means these workers get to take less of their tip money home.

Employees from across the Las Vegas valley, along with the Culinary Workers Union, are demanding the IRS negotiate with tipped workers.

During the pandemic, the IRS lowered the rate by 50 to 60 percent, as many hospitality workers struggled financially. But now the rates are back up, and the union is calling them "unreasonably high" — especially at a time when everything from gas to groceries to rent is getting more expensive.

"Right now, it costs me $100 just to get to work," said Aretha Wilder, a cocktail server at The Flamingo. "I worked 80 hours and my check was $471 and some change."

The union says the IRS raised the rate without talking to workers, as it has done in the past. The IRS declined to comment on Thursday's protest.

As these workers continue to recover from the pandemic — and now grapple with historic inflation — many said their savings have taken a hit.

Before the pandemic, Diego Ledesma says he could rake in about $2,000 a month in tips alone as a server at Roma Deli Restaurant on Sahara Avenue. Now, he's still falling short.

"Ah, it's been a nightmare," Ledesma said. "You only make $500 to $550 — you can tell the difference."

Business has been up lately, Ledesma said, but inflation is increasing, too. He isn't seeing the money he used to, even before the IRS raised the tip allocation rate.

"I feel bad, because it's hard to live right now because the IRS wants to take more money from you, but we don't make the money we used to before the pandemic," he said. "It's been really hard to live with this money right now...everything is going up."

Ledesma said he understands inflation is hurting everyone, not just tipped workers, and he's grateful for the tips he does receive.