I am a salon owner, in Pennsylvania, I recently stopped accepting tips on credit cards because of a few reasons, first it sucks the cash flow out of the shop, if I have $100 in cash customer's and $300 in credit cards but $120 in tips gets paid out of the drawer, or giving back to the customer to give to the stylist, 1st I am not an ATM, second now the cash that is like free money has to be taxed and percentage has to be paid to the Credit card company, and the hassle of extra paperwork to keep records of the tips is impossible so that at the end of the year the stylist have to report all of that tip money which they don't want to do, So for Instance a customer has a bill of $100 but wants to tip $20, total $120..If I just accept the $100 and she pays $20 cash to the stylist I only pay 8% on the $100 So I make $92.00 Now If I put the whole $120 on the credit card I have to take cash out of my drawer, write down paperwork to ad up for a 1099 at the end of the year for the stylist to pay taxes on that money, which I have to match the SSI and Medicare portion, and now Out of that $120 I get $110 I just paid $2 extra which might not sound like a lot, but I see 400 customers a month and 3/4 pay with cards, its about $500-$600 a month, which works out to around $5000 to $8000 a year of money that I have been charged taxes and charges on that wasn't even mine and the maybe that sends up the red flag for an audit and then everyone loses, its not worth losing my business for someone who is to lazy to bring $5 to $20 in cash for a tip when they know they are coming to the salon to get their services, they made the appointment. Why should I have to lose money just because its easier to flash it on the card.