Tip Pool Calculator

Divide the total tips by the total hours everyone worked, then multiply by each person's hours.

Tip pooling means tips are collected into one pot and shared among a group of staff, often by hours worked. Under the federal FLSA, an employer may require a mandatory tip pool, but the employer, managers and supervisors may not receive tips from it.

If the employer takes a tip credit, the pool may include only employees who customarily and regularly receive tips, such as servers, bussers and bellhops. If every worker is paid at least the full federal minimum wage of $7.25 an hour in cash, the pool may also include staff who are not usually tipped, such as cooks and dishwashers. State rules can be stricter.

No. Under the FLSA, managers and supervisors may not receive tips from a pool. They may keep only tips a customer gives them directly for service they directly and solely provide. The Department of Labor counts someone as a manager or supervisor if their main duty is managing, they direct at least two full-time employees (or the equivalent), and they can hire or fire or their recommendations carry weight. An owner with at least a 20% stake who is actively involved in management counts too.

Under federal law, an employer can pay a tipped employee a cash wage of at least $2.13 an hour and count tips toward the rest of the $7.25 federal minimum wage. That makes the largest federal tip credit $5.12 an hour. A tipped employee is someone who customarily and regularly receives more than $30 a month in tips. Many states set a higher cash wage or do not allow a tip credit.

Under the Department of Labor's rules, tips collected in a mandatory pool must be paid out no later than the regular payday for the workweek, or as soon as practicable after it if the amounts can't be worked out before payroll is processed.

Usually, because someone who worked a double shift contributed more than someone who worked a short shift. Some restaurants also weight by role using points.

Yes. Each employee reports the tips they receive from the pool as income, and the employer includes reported tips in payroll taxes. For 2025 to 2028, workers in occupations that customarily receive tips may be able to deduct qualified tips, including tips received through tip sharing, up to $25,000 a year on their federal income tax return. The deduction phases out above $150,000 of modified AGI ($300,000 for joint filers).