Derrick says: Most of the restaurants include service charge in the bill of its customers. This service charge is distributed to the restaurant employees as part of their payroll. Will the service charge also be subject to tax? Should the company withhold tax for this?

Lavern says: There is a local restaurant in my area and I have heard that the owner refuses to pay an hourly minimum wage to its employees and asks that they work for tips instead.
Please advise. Thanks.