Tipping in the USA: History, How Much to Leave, and How to Check the Bill

Coffee for 5 dollars, and before paying, a question about extra money appears on the screen. Dinner for 100 dollars, but the final bill is higher due to tax and service. The first stay in the USA can be surprising if you expect the menu price to be the total amount due.

Today's tipping has a history rooted in European service, Black railroad porters, and struggles for wages. There was even a time when some American states tried to ban tipping. Today, it is essential to distinguish between three things: voluntary tip, mandatory service charge, and sales tax. Each has a different meaning.

Why Tipping Became Part of American Wages

We do not know a single certain moment for the origin of tipping. In England, guests of wealthy households would give servants additional money called "vails." Americans traveling in Europe brought similar customs back home. Some of their compatriots saw this as a remnant of aristocratic order, incompatible with the proclaimed equality of citizens in a republic. The Federal Reserve Bank of Richmond describes the European roots and the dispute over tipping.

After Slavery, Freedom Did Not Mean Equal Opportunities

The Pullman Company, founded in 1867, employed Black porters in sleeping cars. Among the first employees were formerly enslaved individuals. They prepared beds, cleaned shoes, and served passengers. They worked long hours for low wages, which were meant to be supplemented by tips. African Americans did not have access to better-paying conductor positions. The Library of Congress describes the employment and working conditions of porters.

Tipping was not invented after the abolition of slavery. It existed earlier. However, the history of Pullman shows how dependence on passenger money functioned within an employment system based on racial inequalities. This is not the only explanation for the popularity of tipping across the country.

27.50 Dollars a Month and Money from Passengers

A report from the Commission on Industrial Relations in 1915 stated the standard salary for a Pullman porter: 27.50 dollars a month. In a section prepared by Basil M. Manly, it was indicated that employees had to earn tips to survive, and the company benefited from the difference between the appropriate wage and the paid salary. The document also mentions very long working hours, limited sleep, and the obligation for porters to provide shoe-cleaning supplies. The 1915 report, printed pages 108–110, section "The Pullman Company".

This story also involves the son of Abraham Lincoln. Robert Todd Lincoln was the successor to George Pullman as president of the company. This is confirmed by the Pullman archive description at the Smithsonian Institution. This surprising intersection of the president associated with emancipation and a company dependent on the labor of Black porters is noteworthy.

America Tried to Ban Tipping

William R. Scott, in his 1916 book "The Itching Palm," criticized tipping as a practice contrary to democracy. He also cited a South Carolina law prohibiting giving and receiving tips in certain places. Violating the bans could result in a fine of 10 to 100 dollars or up to 30 days in jail. This is a record of sanctions, not evidence of how often it was enforced. Scott was a participant in the dispute and a staunch opponent of tipping. "The Itching Palm," Chapter XV "Laws Against Tipping".

Anti-tipping regulations in Iowa and South Carolina were also noted in the federal labor law compilation from 1915. The bans did not eliminate the practice and eventually disappeared. Porters fought for better working conditions: the Brotherhood of Sleeping Car Porters was formed in 1925, and in 1937 it secured a contract with the company, higher wages, and better employee protections. The National Park Service describes the union's activities.

Where the Rate of 2.13 Dollars an Hour Comes From

Federal law allows qualifying employers to use a "tip credit," meaning they can count part of the tips towards their obligation to pay minimum wage. The direct payment can then be 2.13 dollars an hour, but with tips, the employee must earn at least the federal minimum of 7.25 dollars an hour in each workweek. The employer pays the missing difference. The U.S. Department of Labor explains the conditions of the tip credit.

This mechanism was added to the FLSA in 1966. The Congressional Research Service table shows the amount of 2.13 dollars as early as 1991. The 1996 law change established the direct minimum as a dollar amount rather than a percentage of the minimum wage. CRS, report R43445, pages 1–3.

This is not the rate for all waitstaff. In New York, Long Island, and Westchester, in 2026, the direct minimum for "food service workers" is at least 11.35 dollars and a maximum of 5.65 dollars in tip credit, totaling a minimum of 17 dollars. The New York State Department of Labor table for 2026. Some states, including California and Washington, require the full state minimum wage before tips. Summary of state rules.

How Much Tip to Leave Today in the USA

These are guidelines, not a price list established by law. The Emily Post Institute suggests for full-service restaurants a tip of 15–20% before tax. As a simple travel plan, you can assume 20% for good waiter service, after checking if service has already been included. You can leave more at your discretion.

Full table from the Emily Post Institute. When ordering delivery through an app, check separately for "delivery fee," "service fee," and "tip"; the name of the delivery charge alone does not confirm a tip for the driver. DoorDash distinguishes between platform fees and voluntary tips for the delivery driver.

Rides ordered through an app also do not have a legally mandated 20%. Uber informs that tipping is voluntary. Before adding a tip in the app, remember whether you already gave cash to the driver.

Not all Americans tip in every situation. In a Pew survey from 2023, 92% of those using full-service restaurants reported tipping always or often, compared to 25% of those buying drinks at a café and 12% of customers at fast casual establishments without waitstaff. These are declarations from a specific survey, not a measurement of all transactions in 2026. Pew Research Center results.

How to Calculate a Tip and the Total Cost of a Meal

First, find the "subtotal," which is the amount for ordered items before tax and additional charges. For a regular bill without a service charge, use the formula: tip = subtotal × percentage ÷ 100. Calculating from the amount before tax corresponds to the Emily Post guideline. Check if the terminal calculates differently.

Without a calculator: 10% is a shift of the decimal point by one place. Double 10% gives 20%, and 10% plus half that amount gives 15%. For 80 dollars, this is 8, 16, and 12 dollars, respectively.

Menu Price vs. Amount to Pay

For example, with a hypothetical tax of 8%: meal 100 USD + tax 8 USD + voluntary tip 20 USD = 128 USD. The 8% rate is for calculation purposes only; the actual sales tax depends on the location and type of sale. It is not a single tax rate for the entire USA.

If the terminal calculates 20% on 108 dollars, it will suggest 21.60 dollars instead of 20. The difference of 1.60 dollars results from a different base. It is not automatically evidence of fraud: choose your own amount if you want to calculate from the subtotal. Square allows sellers to set the tip calculation before or after tax. Tip settings in Square.

How to Split the Bill Among Several People

For an equal split of a sample bill of 128 dollars among four people, each pays 32 dollars: 25 for food, 2 for tax, and 5 for tip. If you are paying according to your own orders, determine who covers shared items. Sum the tips to avoid accidentally leaving them twice or omitting them entirely.

Do not automatically calculate another 20% from the total that already includes "gratuity." First, read the meaning of that item.

How to Read an American Bill and Not Pay Twice

The IRS distinguishes between voluntary tips and mandatory charges, even if the latter are labeled "automatic gratuity" on the bill. In federal tax reporting, the name does not resolve the matter: what matters is whether the customer voluntarily chose the payment and its amount. IRS: tips and service charges.

If service has already been included, an additional voluntary tip may be zero. If only a "service charge" has been added, ask if the charge replaces the tip. Do not assume that the entire amount goes to the waiter. The answer will allow you to decide consciously whether you want to add something; merely asking for more money does not create an obligation.

Example: food 100 USD, "gratuity 20%" 20 USD, and a separate tax item. A blank line for "additional tip" below does not mean you must add another 20 USD. If you do not want to add anything, write 0 and the correct total.

Can a Restaurant Add Service Without Asking?

There is no single answer for the entire country. An added charge may result from properly disclosed order conditions, without a separate verbal inquiry at payment. However, this does not mean that any arbitrary hidden charge is allowed.

In New York City (NYC), § 5-59 requires clear disclosure of permissible charges before ordering food or drinks. It lists, among other things, mandatory gratuity for parties of eight or more. It separately allows certain charges resulting from a written agreement between the restaurant and employees, provided they are disclosed in advance and the entire amount is passed on to the employees. This is not a general permission for any additional charge to any price. Full NYC regulation, § 5-59.

In California, the Attorney General explains the exception regarding mandatory charges in restaurants, bars, and specified food vendors: charges must be clearly and conspicuously shown where prices are listed. California Attorney General: SB 478 and exception SB 1524.

Before ordering, check the menu, including digital ones, and the information next to prices. "They didn't ask me personally" and "they didn't disclose the charge before ordering" are two different situations.

Six People or Eight People at the Table

In practice, you will also encounter in NYC the notation "parties of 6 or more," meaning six people or more, not just seven. For example, Mr. Purple in its menu describes a 20% charge for such a group but notes that gratuity is discretionary and the customer can adjust its amount until the end of the visit. This is an example of one establishment's policy, not evidence of a general rule for all restaurants.

An automatically added amount is not always mandatory. Look for the words "discretionary," "voluntary," and "may be adjusted." If they are present, ask for a change or removal of the item. The mere label "6+" is not a statutory mandate to pay 20%.

In the justification for the change effective April 19, 2026, the DCWP explained that eight people is an established example of permissible mandatory gratuity, but the catalog of examples is not closed. Other charges must correspond to actual additional services ordered by the customer and be clearly disclosed. This does not imply that every charge for six people is legal or that every charge is prohibited. DCWP, adopted change and its justification, pages 1–2.

Dividing one table into several bills does not itself determine how the establishment counts the size of the group. Establish this rule when making a reservation or before ordering. The NYC regulation pertains to the city, not automatically to the entire state of New York.

What Happens If You Don't Leave a Tip

With a voluntary tip, you choose whether and how much to give. The IRS defines it precisely by its voluntariness and the customer's decision on the amount. Not leaving a voluntary tip is a different situation than refusing to pay for a meal or a required service charge.

In a restaurant with waitstaff, tipping is a strong custom. Its absence may be perceived as dissatisfaction; the staff may ask for the reason. When buying coffee at the counter, refusing a tip falls within the Emily Post guidelines. Do not treat a screen showing 25% as an official mandate.

If the service was poor, explain the problem to the manager, preferably immediately. A delayed dish, kitchen error, and waiter behavior may require different solutions. Ask for corrections to the order or bill; simply not leaving a tip will not explain what happened.

They Added Gratuity and You Don't Want to Pay It

1. Determine whether you see only a suggestion or an amount already included in the "total."
2. Ask whether the charge is voluntary or mandatory and where it was disclosed before ordering.
3. If it is a voluntary item, ask for its removal or a change in amount before payment.
4. If the establishment claims it is a mandatory charge, ask the manager for the basis and explain why you are contesting it, for example, lack of prior information, incorrect number of guests, or double charging.
5. Take a photo of the bill and the relevant menu section. Request a corrected bill or a written response.

Do not assume that you can strike out any properly disclosed mandatory charge solely because you do not want it. Do not leave without explanation and settling the amount due. If the dispute remains unresolved, you can pay, keep the evidence, and seek reimbursement. Simply paying or adding a note of reservation does not guarantee the outcome of the complaint.

A hidden charge appeared only on the bill: where to report it

In NYC, the obligation to disclose permissible charges in advance does not disappear with a large group. Information shown only on the final bill does not meet the requirement for disclosure before ordering. Conversely, a clear statement available before ordering can serve as notification, even if the waiter did not read it aloud. In a dispute, indicate exactly what was missing, rather than limiting yourself to stating "no one asked."

Ask the manager to show the prior information and to remove the undisclosed item along with the appropriate tax adjustment. Take photos of the bill, menu, or order screen. Note the date, address of the establishment, number of people, percentage and amount of the surcharge, name of the item, and the manager's response. If you paid, keep the receipt and request a written refund of the specific amount.

NYC311 and DCWP in the five boroughs of NYC

NYC311: Restaurant Complaint accepts reports of unauthorized surcharges and mandatory tips. Select the issue with restaurant surcharge or call 311. Provide contact information if you expect a response: without an address or email, the agency will treat it as a signal without further contact. In the NYC311 process, after receiving the form, it must be filled out and returned to continue the complaint.

You can also directly use DCWP: File a Consumer Complaint. An account is not required; attach copies of bills and other evidence, and keep the case number. An official complaint form in Polish is also available with submission instructions. Do not include full card numbers, account numbers, or other unnecessary sensitive information.

In your English description, you can write: "An automatic service charge of [amount] was added to my bill. It was not disclosed before I ordered. I asked the manager to remove or refund it, but [describe the response]. I am requesting a refund of [amount]." Replace the brackets with facts from your visit; if there was a statement in the menu, describe its content and visibility truthfully.

The rest of New York State and disputed card charges

Outside of NYC, check with the consumer protection agency of the appropriate county or New York Attorney General: Consumer issues. The state agency's form also allows complaints from individuals outside the USA. Instructions for Consumer Frauds Complaint Form indicate for them to select "Consumer Frauds NYC." This is a guideline for selecting the office in the state form, not an extension of the city DCWP's jurisdiction to the entire state.

A complaint to the agency and a bank dispute are separate actions. If the amount charged to your card is disputed, report it to the card issuer along with the bill and description of the problem; do not wait for the agency's outcome at the expense of the bank's deadline. Reporting does not guarantee a refund or automatic cancellation of the charge. DCWP may mediate, and the assessment of the specific surcharge should be left to the appropriate authority. DCWP explains the complaint resolution process.

Do tips look the same in other states and small towns?

Tips in waiter-served restaurants are a general American custom, not just a New York one. Emily Post's guide does not limit the 15–20% guideline before tax to metropolitan areas. It is a useful starting point even when traveling through small towns. The nature of the service, included service, and the rules of a specific establishment are more important than the city's population.

Do not assume that outside of New York, no one expects a tip, but do not automatically raise it to 25% just because you are in a big city. At the same chosen rate of 20%, a meal costing 20 dollars means a 4 dollar tip, and for 100 dollars, 20 dollars. This is an example of calculations, not a claim that every small establishment is cheaper than an urban one.

Regulations regarding the disclosure of surcharges, the purpose of service charges, taxes, and employee compensation vary between states and sometimes even cities. Here are examples that help avoid transferring one rule across the entire USA:

Sources for new examples: Florida Statutes § 509.214, Washington Labor & Industries: Tips and Service Charges, Massachusetts Attorney General: guidelines for restaurants. These are examples of rules, not a list of all obligations in fifty states.

In Florida, you can report a problem with fee disclosure in a regulated food establishment to DBPR Division of Hotels and Restaurants. The agency has a specific scope of authority; reporting a violation does not replace seeking a refund from the establishment or a bank dispute. In other states, look for the state Attorney General or local consumer protection.

In a small town, follow the same practical order: read the menu, check the bill, determine what is voluntary, and only then choose your own tip. The absence of a New York regulation does not mean consent to any hidden charges; local rules must be checked.

Can sales tax be applied to tips?

First, separate two questions: whether the employee reports income from tips and whether the restaurant charges sales tax on a given item. These are different taxes. Simply stating that "tips are taxed" does not clarify the customer's bill.

California: mandatory charge may increase the tax base

According to CDTFA, voluntary tips are not subject to sales tax. However, a mandatory payment designated as a tip, gratuity, or service charge is included in taxable sales revenue, even if it is later received by employees. CDTFA, Publication 115.

Example with a contractual rate of 8%, not the rate for all of California:

The tax of 9.60 dollars in the second column may therefore be correct. Adding the mandatory charge and tax on it does not in itself prove fraud.

New York State: exception for specific mandatory gratuity

Voluntary tips are not subject to sales tax there. An automatically added gratuity is also excluded from the base if it meets all three conditions: it is shown separately, labeled as gratuity, and the total is given to employees. If the conditions are not met, it is taxed. Service charges not designated as gratuities are subject to sales tax. New York State Tax Department, Tax Bulletin ST-320.

Therefore, two bills with the word "gratuity" may have different correct calculations. In the example bill of 100 + 20 USD, if the New York conditions are met and the contractual tax is 8%, the sales tax will be 8 USD, and the total will be 128 USD. However, the facts, including the purpose of the money, must first be established.

What to do if tax was also charged on the tip

1. Request a bill with a breakdown of items, rates, and tax base.
2. Ask whether the surcharge is a voluntary tip, mandatory gratuity, or service charge.
3. Compare the rules of the appropriate state. In California, tax on a mandatory charge may be correct; in New York, the three specified conditions matter.
4. If you see an error, ask for it to be removed and for the tax and total to be recalculated. After payment, request a refund of the overpayment and confirmation of the correction.
5. Keep documents. If refused, contact the state tax office regarding sales tax and, when it comes to hidden charges, with consumer protection.

Do not automatically demand the removal of the entire charge just because it includes tax. A dispute over the amount of tax and a dispute over the very right to add service require separate clarification.

Why does the terminal ask for 25 percent even for a regular purchase?

Such prompts may result from system configuration. Square allows the seller to choose their own values, method of calculation, and the timing of displaying the screen. If you want a different amount, look for "custom amount," "other," or "no tip." The mere display of 18%, 20%, and 25% does not say anything certain about the salary of the person behind the counter.

Prompts can influence decisions. An experiment involving 94,571 orders in a pickup and delivery laundry app found that higher suggested amounts increased the tips left. This does not prove an identical effect in every café. Alexander, Boone, and Lynn, study in Management Science.

In a Pew study from 2023, 72% of adults believed that tipping is expected in more places than five years earlier. This is a measure of respondents' feelings, not a list of all establishments. Pew on changes in tipping culture.

How to pay by card and what to do if the charged amount is different

If you receive a paper bill with fields for "tip" and "total," write in your chosen tip amount and the total sum. If you leave the tip in cash, write "cash" or 0 in the tip field on the card and the appropriate total charge. Do not leave these fields to be filled in later by someone else. Take a photo of the completed copy.

At the terminal, read the summary before confirming. Check the amount, currency, added service, and whether your additional amount is already included. Keep the receipt. In your banking app, distinguish between pending transactions and those that are finally settled; ask the card issuer about the nature of the hold, rather than assuming that every change is an additional tip.

If the settled amount exceeds what you authorized, compare it with the photo of the bill. Ask the restaurant for a correction and a copy of the document. If the error is not resolved, report a transaction amount dispute to the card issuer. Describe that the purchase was yours, but you are disputing a specific surcharge; do not report the entire meal as a purchase you did not make.

The FTC describes the American procedure for disputing billing errors on credit cards: a written complaint should reach the appropriate address within 60 days of sending the first statement with the error. Contacting the seller should not deprive you of this deadline. FTC: disputing credit card billing errors. For a card issued in Poland or another country, establish the procedure and deadlines with your bank; do not automatically assume the application of American procedures or identical rules for a debit card.

A dispute does not guarantee a refund. Distinguish between an actually erroneous or unauthorized amount and a charge that the establishment properly disclosed and charged.

Do the tips go to the waiter and does tip really mean an acronym?

Tips can be shared in an allowable tip pooling system. Federal regulations prohibit employers from retaining employees' tips. However, not every mandatory charge visible on the bill should be equated with a tip.

The second trap concerns a popular legend: "TIP" is said to stand for "To Insure Promptitude." This is not an established origin of the word. Merriam-Webster records the verb "tip" in the sense of giving or conveying something around 1610; this is not the birth date of modern tipping. Merriam-Webster, part of Word History.

Cheat sheet before payment and useful sentences in English

• First, read the menu and the surcharge conditions, then order.
• When checking the bill, see if service is already included.
• Calculate voluntary tips from the consciously chosen base; a practical starting point is the subtotal before tax.
• Do not mechanically add another 20% to the amount with gratuity.
• Sales tax on service charges may be correct. Check the rules of the state.
• Write the tip and total, keep the bill, and compare it with the card settlement.

Understanding the history of tipping helps to comprehend this custom. However, at the table, the most useful thing is to take a moment to read the bill: what you ordered, what was added, what tax was charged, and what additional amount you want to leave.

Information status: October 28, 2026. Rates are customary guidelines; rules regarding fees, wages, and taxes depend on the location. The example of 8% is not a nationwide sales tax rate.