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Tip credit compliance varies significantly by state: some states disallow the tip credit entirely, others set minimum declared wage floors above the federal requirement, and some follow FLSA defaults. Use this endpoint to verify that a merchant’s combination of hourly wage and average tips meets both the federal FLSA threshold and any applicable state-specific rules before running payroll.

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Endpoint

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Authentication

All requests require an x-api-key header.

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Request body

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string
required
Two-letter U.S. state code for the state whose tip credit rules you want to validate against. Example: IN
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number
required
The employee’s declared hourly wage in dollars. Example: 7.25
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number
required
The employee’s average tip earnings per hour in dollars. Example: 3.50

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Code example

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Response

The response indicates whether the provided wage and tip combination complies with FLSA requirements and the specified state’s tip credit regulations. Non-compliant results include details on which requirement was not met.
This endpoint validates compliance for a single employee’s wage configuration. Run it before processing payroll for tipped employees whenever you expand into a new state or update wage rates.