Topic: If we don’t accept tips as an acceptable source of income, is that considered "source of income discrimination"?

So regarding proof-of-income, if someone is a waiter and can show cash deposits, I do not take that income into consideration because tips can vary. I tell people that we only accept verifiable income. Is this considered "source of income discrimination"?

Be careful one can't discriminate against types of income. I would suggest asking for the latest tax return that shows declared income in tips

I would accept it - because chances are what they showing as deposits is going to equal what they claim for taxes (and chances are they are going to make more)! BUT if your criteria states the income used as verificable than you're covered. Unless the state/county/city you work in protects "income" under fair housing; though I don't understand why any place would have put into law protecting sources of income, but... Our company does not take Unemployment because its runs out, child support because there is no guarantee that one would receive cs or gift letters for obvious reasons.

Brad is correct. It's on then to prove it via tax returns. If they don't wanna declare their income and live that cash only lifestyle that's on them.

Schedule C on tax return should show their income if they are indeed claiming all income

Schedule C is only for self employed. Most people that work for cash tips are not self employed. Tips are reported at the end of the day. When they receive their pay check - reported tips are taxed and deducted from their gross pay hence you will see 9 times out of 10 their net check stub is less than $25 if not $0.

In Georgia I have seen the tips included in the checkstubs so that is what I use. If they tell me they make more tips than what is on check stubs they have to provide tax returns then.

Yeah this is true. All tips on credit/debit card receipts are reported. Since people mostly pay with cards these days rather than cash it makes sense.

Accept it but use an average OR have their employer put on company letter head what they average in tips per month.

Remember, in California, source of income is a protected class. Even the Government allows bank statements for proof of cash income. Every Property Management Department I oversaw, I allowed bank statements to be used for proof of income

I’d refer to what’s outlined in your criteria/qualifications and your company policy as far as what serves as sufficient proof of income. I’ve always asked for pay statements and their tax docs. If they aren’t reporting all their tips (bc let’s face it, most SI don’t) then that’s on them.

I would normally have them fill out a tip affidavit stating the average amount. If one check shows $600 in tips but others show $200 range you can average it out to $275

We consider cash deposits into the bank if they are consistent/repetitive. My niece is a server. all her pay including credit card tips are paid via direct deposit. While she makes a fair amount in cash tips which are of course separate, she does create a trail of deposits and such. I know not everyone does that. If they can't show me a bank deposit then or something to show they made money then we cannot approve.

We only accept the cash tips that are noted on their pay stubs.

What about using income tax returns from the previous year?

Tip affidavit

If they make cash tips and can show steady income including regular bank deposits of cash tips (3 months of bank statements) then I would accept it

A letter from their boss should be fine.

3-6 months of cash deposits totaling more than income requirement, absolutely! You are verifying they HAVE adequate income, NOT how they got it

Is source of income as long it can be verified in bank statement deposit

If they have 3 months of cash tips that average and meet your qualifications, what's the problem. A person on salary can vary if they have a family member die and run out of PTO & bereavement. My experience with servers is they pay their rent cause they have money in the bank to do so.

I ask for a letter from mgmt on letterhead stating what there average monthly income is.

Income sources should be listed on the Resident Qualifying criteria for your property or Management Company. In Some states Income types are protected. Fair housing guidelines should be considered and consistency is key.

We are HUD housing and we DO include tips as cash income. That being said, GETTING that info is another story. However, if their paystubs do not show tips, we usually send out an Employment Verification form to the employer and ask, among other things, their hourly wage and their tips. Here the employer is required to show income of at least minimum wage (for their W-2s)...so if they pay $3/hr. then the tips need to make up the difference. So in most cases the verification will show that they are earning min wage. If they make "good" tips the employer will oft times list the hourly and the ave. tips per hour or day as well.