What Happens If You Forget to Close Your Tab?

Forgetting to close a tab at a bar or restaurant is a common occurrence many people experience.

How Establishments Process Open Tabs

When a customer opens a tab, they typically provide a credit or debit card. Businesses often place a pre-authorization on the card, which is a temporary hold on a specific amount to verify its validity and ensure sufficient funds are available. This initial hold is not a charge but reserves a portion of the card’s credit limit or bank balance for future payment.

If a tab is left unclosed at the end of the night, bars and restaurants usually have a policy to automatically process the payment using the card on file. This practice is often disclosed through visible signage within the establishment or on menus, and providing a card generally implies agreement to these terms.

Many establishments add an automatic gratuity or service charge to unclosed tabs, commonly ranging from 18% to 20% of the total bill. This automatic gratuity is considered a service charge by the Internal Revenue Service, rather than a tip, and is therefore subject to payroll taxes. Once the final bill, including any applied auto-gratuity, is calculated, the establishment converts the pre-authorization hold into a completed transaction.

What Appears on Your Credit Card Statement

After an unclosed tab is processed, customers will see a charge on their credit card statement that reflects the total bill, including any automatically applied gratuity. Initially, a pre-authorization hold might appear as a pending transaction, temporarily reducing your available credit or funds. This hold is distinct from the final charge and is used to confirm payment capability.

The actual charge, which includes the cost of items consumed plus the automatic gratuity, typically posts to your account within a few business days. While the pending pre-authorization might disappear, the finalized transaction will show as a single entry on your statement. The gratuity amount is usually integrated into the total charge and not itemized separately.

If the final transaction amount is less than the pre-authorized amount, the hold on the unused funds is released, making that portion of your balance available again. It is important to remember that by providing your card to open a tab, you implicitly agree to pay for the services, which includes any disclosed automatic gratuity policies.

Steps to Take If You Forgot

If you realize you have forgotten to close a tab, the first proactive step is to monitor your bank or credit card statement for the charge. The full amount, including any automatically applied gratuity, should appear within a few business days. Reviewing your statement helps you identify the exact charge and its processing date.

The most direct way to resolve any questions or discrepancies is to contact the establishment directly. When you call, be prepared to provide details such as the date and approximate time of your visit, along with your name and any other information that can help them locate your tab. Many times, a quick phone call can clarify the charge or resolve any billing errors.

Should direct communication with the establishment not resolve the issue, you have the option to dispute the charge with your credit card company or bank. Consumer protection laws, such as the Fair Credit Billing Act, provide rights to dispute billing errors. You typically need to send a written notice to your credit card company within 60 days of the statement date. During the investigation, you generally are not required to pay the disputed amount. It is important to document all communications and details related to the charge, as this information will support your dispute claim.