Limousine Client - Payroll

[Hoosier]

Got a new client - small limousine business. Question is regarding gratuities. If the company charges, let's say $300 for a job and in addition, collects a 15% in the form of a gratuity ($45) for the driver, how is the gratuity booked? For example, is the total sale $345? If so, is the gratuity when paid to the driver an expense to the company? Is the gratuity subject to payroll taxes and reported on the driver's W2? I'm looking for an IRS publication or other information that goes into some detail on how to handle payroll for this type of situation. Thanks for any thoughts or suggestions.

[ChEAr$]

Got a new client - small limousine business. Question is regarding gratuities. If the company charges, let's say $300 for a job and in addition, collects a 15% in the form of a gratuity ($45) for the driver, how is the gratuity booked? For example, is the total sale $345? If so, is the gratuity when paid to the driver an expense to the company? Is the gratuity subject to payroll taxes and reported on the driver's W2? I'm looking for an IRS publication or other information that goes into some detail on how to handle payroll for this type of situation. Thanks for any thoughts or suggestions.

The company collects the added 45, therefore it has that income. If the company adds the 45 to drivers regular pay, it's all pay and subject to usual withholdings and of course total wages are expense.