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No Tax on Tips Explained: Real-World Examples by Industry
Dec 16, 2025
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8
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Calculating payroll requires a structured, step-by-step process to ensure accuracy and compliance.
Using a consistent system or payroll software helps reduce errors, save time, and ensure employees are paid correctly every cycle.
Jenny’s average day as a business owner before CoAdvantage involved scanning the news for state-by-state legislative updates, analyzing and unpacking new laws, and managing stacks of employee paperwork. Although she was working with a payroll provider, her overall HR needs far exceeded what they could offer. Onboarding was anything but a breeze, and employee benefits simply weren’t an option.
Managing workers’ comp and compliance proved challenging as well—not to mention the fact her business is subject to the Jones Act, a federal law restricting the transportation of goods by water between US ports to American-built, -owned, and -crewed vessels. How could she make room for growth, strategy, and questions of long-term business success when the realities of day-to-day operations were so overwhelming? If only there was a better solution than her payroll provider. Thankfully, there was: handing HR to the experts at CoAdvantage.
Payroll providers may offer seamless payroll processing, but it takes a PEO (Professional Employer Organization) like CoAdvantage to offer next-level, behind-the-scenes HR support. When CoAdvantage acquired Naples Cruise Lines’ payroll provider in 2018, our team was prepared to provide peace of mind and automated solutions so Jenny could put her HR worries aside and focus on building a thriving business. That’s the difference that partnering with a PEO makes.
Compliance can be a source of serious chaos without HR professionals on your side. Jenny had experienced this first hand. Thankfully, CoAdvantage provides a level of risk management and compliance support that extends across state lines and out into the water where the Naples Princess and other vessels complete their daily journeys.
In addition to providing vital support for the Paycheck Protection Program (PPP) during the COVID-19 pandemic, our experts handled workers’ compensation coverage and an unexpected tax audit. They even created a custom formula to calculate tips, payout tips, and handle overtime to accommodate Naples Cruise Line’s unique gratuity structure.
CoAdvantage is also committed to providing consistent communication and stellar customer service. As Jenny explains, “Somebody always responds to me. They are always there, they always pick up their phone, and somebody always answers your email within a very short period of time, not hours.” That’s compliance and peace of mind all rolled into one HR outsourcing experience.
Jenny wanted a smooth, simple hiring and onboarding process, which is exactly what CoAdvantage provides. Whether she needs help setting up direct deposit or sorting out I-9 verification, it’s “super easy,” Jenny says. “The documents are right up in the portal. You just download it, we give it to our employees to fill out and then literally I just scan it and send it to CoAdvantage. And then our rep puts it into the system and says, okay, it’s good.”
With far fewer hiring tasks to worry about, Jenny has an opportunity to truly welcome each new employee, encouraging them to hit the ground running and give their best to a cruise line that cares about their success from day one.
The cost of high-quality employee benefits is often what prevents small businesses from offering benefits at all. Thanks to CoAdvantage’s ability to source Fortune-500 level benefits at more affordable prices, they were able to help Jenny give her loyal crew members health insurance and other supplementary benefits, such as free counseling sessions. Plus, a CoAdvantage representative is always available to help her employees when they experience trouble with their pay or their tax statements.
“For our employees, there are real benefits to being part of CoAdvantage that I don’t think a lot of other companies provide. There’s so many little ancillary benefits.”
Jenny Gezella, President, Naples Princess
The outcome? A happier, healthier workforce that’s structured for serious longevity. It’s no secret that employees who feel valued and supported are more likely to be loyal to a brand, which is why CoAdvantage has been so dedicated to making better benefits possible for Naples Cruise Line. We see the big picture: lower turnover, higher retention, and fewer resources spent on scoping out the right team members.
Naples Cruise Line has been steadily growing since they began working with CoAdvantage. Three to four daily cruises and 44 employees, including captains licensed by the United States Coast Guard, keep Jenny busier than ever, but with CoAdvantage’s help, a busy day is a productive day. Their primary yacht, the Naples Princess, is now just one of 46 vessels in her company’s ever-growing fleet.
CoAdvantage’s intuitive, user-friendly platform, CoAdQuantum, simplifies HR by putting everything from training courses and talent management to automated salary administration and pre-hire screening in one secure platform that Jenny can access anytime, anywhere. She can rest assured that her business’s data is safe, confidential, and analyzed to deliver smoother operations. Paired with our expert guidance, this modern technology allows Jenny to make the best decisions for her business.
Time is finally on Jenny’s side. Without the usual HR headaches anchoring her in place, she’s free to focus on what really matters:
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