What Is Cash Wage? (2026)
Your cash wage is the only part of a tipped paycheck your employer pays out of its own pocket: the guaranteed hourly amount on the check before a single tip is counted. It runs from $2.13 an hour in the states that follow the federal floor all the way up to the full state minimum elsewhere. Knowing which number applies to you — and what it does and does not promise — is the first step in reading your pay stub correctly.
By the TippedPay editorial team · Updated $1
Key numbers at a glance
| State (2026) | Cash wage | Full minimum | Guaranteed pay, 30h | Total with $450 tips |
|---|---|---|---|---|
| Texas | $2.13 | $7.25 | $217.50 | $513.90 |
| Ohio | $5.50 | $11.00 | $330.00 | $615.00 |
| Florida | $10.98 | $14.00 | $420.00 | $779.40 |
| Washington | $17.13 | $17.13 | $513.90 | $963.90 |
What Cash wage means
In the federal tipped-wage system, a tipped employee's wage has two halves. The cash wage is the part the employer must pay regardless of what happens on the floor — $2.13 an hour at the federal floor. The other half is covered by the tip credit, which lets tips stand in for up to $5.12 of the $7.25 federal minimum. If the tips do not arrive, the employer must close the gap with a top-up, so the cash wage is a floor under the floor: the guaranteed starting point, never the whole legal wage. Per the DOL tipped minimum wage table, states choose one of three arrangements.
Tier one is the federal pattern: $2.13 cash, $7.25 minimum, $5.12 credit — Texas, Indiana, Kansas, Louisiana and roughly twenty others. Tier two sets higher numbers of its own: Florida requires $10.98 in cash against a $14.00 minimum, Illinois $9.00 against $15.00, Ohio $5.50 against $11.00. Tier three abolishes the credit: Alaska ($14.00), Minnesota ($11.41), Montana ($10.85), Nevada ($12.00), Oregon ($15.55 standard) and Washington ($17.13) pay the entire state minimum in cash, with tips purely on top. California belongs here too. The complete state-by-state list is on our tipped minimum wage comparison table.
One practical wrinkle surprises every new server: a small cash wage plus solid tips often produces a paycheck that reads zero. Reported tips are taxable income, and the withholding on them is usually taken out of the tiny cash-wage check — $2.13 times 30 hours is $63.90 before any taxes touch it. The money is not missing; it moved. Track total compensation, not the deposit.
How Cash wage affects your numbers
The cash wage sets your guaranteed weekly floor: full minimum × hours worked, checked every workweek. Compare two servers, identical 30-hour weeks, identical $450 in tips. In Texas the check carries 30 × $2.13 = $63.90, and total pay is $513.90. In Washington the check carries 30 × $17.13 = $513.90 — the same as the Texan's entire week — and total pay is $963.90. Same skills, same effort, a $450 gap decided entirely by the state line and the cash wage it mandates.
| State (2026) | Cash wage | Full minimum | Guaranteed pay, 30h | Total with $450 tips |
|---|---|---|---|---|
| Texas | $2.13 | $7.25 | $217.50 | $513.90 |
| Ohio | $5.50 | $11.00 | $330.00 | $615.00 |
| Florida | $10.98 | $14.00 | $420.00 | $779.40 |
| Washington | $17.13 | $17.13 | $513.90 | $963.90 |
Read the "guaranteed" column carefully — it is the cash wage's real meaning. That is the money owed even in a dead week with no guests, because tips cannot fall below zero but the minimum cannot either. Ohio shows the middle tier's logic: a $5.50 cash wage means tips only need to cover $5.50 an hour before the $11.00 minimum is met, so the top-up risk shrinks as the cash wage rises.
Common mistakes. Employers treat the $2.13 as the whole wage and skip the weekly minimum check — the single most common violation in the industry. Servers do the mirror image: comparing job offers by cash wage instead of effective hourly (wages plus kept tips, divided by hours), turning down a $2.13-plus-$28-tips job for a $12-plus-$5 one. And deductions — a required tip-out, card-fee charge-backs — come out of tips only; they may never pull the cash wage below the legal floor. Overtime has its own trap: it rides on the full minimum, not your cash rate, the regular rate concept the overtime calculator handles.
When does the cash wage matter most? Slow season, new jobs, and any week under 25 hours — precisely when tips thin out and the guaranteed floor does the work. Run your own numbers, including the weekly floor check and withholding, in the server paycheck calculator, and see the TippedPay home page for the full toolkit.
FAQ
What is a cash wage?
The guaranteed hourly amount your employer pays you out of its own money before any tips are counted. Federally it can be as low as $2.13; in no-tip-credit states it equals the full state minimum, up to $17.13 in Washington.
Is $2.13 an hour actually legal?
Yes, in states that follow the federal system, but only as the cash half of a two-part wage. Tips (or an employer top-up) must bring every workweek to at least the full $7.25 minimum. $2.13 is never the whole legal wage.
Why is my paycheck zero if my cash wage is $2.13?
Withholding. Reported tips are taxable income, and the taxes are usually taken out of the small cash-based check — which can zero it out. The tips themselves typically reach you shift by shift, before payday.
Which states pay the full minimum as the cash wage?
Alaska, California, Minnesota, Montana, Nevada, Oregon and Washington reject the tip credit entirely, so the whole state minimum arrives in cash — $17.13 in Washington, $15.55 standard in Oregon, $14.00 in Alaska in 2026.
How do I compare jobs with different cash wages?
By effective hourly — total cash wages plus kept tips, divided by hours — never by cash wage alone. A $2.13 base with $28 an hour in tips beats a $12 base with $5 in tips.
Can my employer lower or take back the cash wage?
The cash wage cannot drop below your state's floor, and deductions cannot pull your pay under the minimum. Tip-outs and charge-backs come out of tips, never out of the cash wage itself.