1. Give a gift, not a handout. Of all the holiday traditions, none is as confusing as tipping. Who gets a tip? How much? Etiquette expert Peggy Post, the spokeswoman for the Emily Post Institute, offers this advice: A caddy or a babysitter, say, who has delivered outstanding service throughout the year, worked for you consistently and is someone you've come to rely on deserves recognition. Few service providers will meet that profile, but give a gift to anyone who does. The most convenient gifts are cash, checks and gift cards that can be redeemed at local stores. (For end-of-year amounts that are appropriate for various professions, you can find a tipping tip sheet at kiplinger.com/links/tipping.)
2. Be extravagant with your praise. If giving cash doesn't appeal to you, it's okay to offer your gratitude. "You don't have to write an epistle," says Post. "Writing one word -- thanks -- is enough." For the exceptional person who provided service above and beyond the call of duty at some point during the year, the best gift may be to send a glowing letter to his or her supervisor and share a copy of the letter with the person.
3. No envelopes, please. The U.S. Postal Service forbids cash gifts. If you want to reward a mail carrier who really hasn't been deterred by snow, rain, heat or gloom of night, a book of Starbucks coupons or a box of chocolates worth $20 or less would be okay. FedEx directs its couriers not to accept cash tips but permits tokens of appreciation worth $25 or less. UPS has no formal policy on tipping; its drivers may accept a tip or a holiday gift.
4. What would Santa do? End-of-year gifts are customary in many workplaces for receptionists and personal assistants. Protocol consultant Rosanne Thomas recommends that you avoid gifts that touch the body, such as clothes, perfume and cologne, because they may be too intimate. Gift cards and movie passes are acceptable -- but cash is a no-no.
5. Those bunny slippers may not fit. Don't overestimate your ability to pick a truly appropriate gift, says Mark Brenner, author of Tipping for Success. He offers the following strategy: "Ask co-workers for advice on possible gift ideas, especially items that might relate to a person's hobby."
6. A lump of coal could backfire. You may be tempted to withhold a holiday tip to express your dissatisfaction with the service you're receiving. But the person you stiff may not understand that you're saying service is inadequate. "If you want better service, don't seethe inside," says etiquette expert Thomas Blaikie. "Speak up." And if you're not comfortable confronting the person, talk to a supervisor instead.
7. You're not Daddy Warbucks. When you dine out during the holidays, you may feel social pressure to tip 20% -- or even more. Don't give in. The customary gratuity is 15% of a bill's subtotal before sales tax, say etiquette experts. But don't be stingy, either. Waiters depend on your tips to earn a living, and taxes, health insurance and tipping pools that include bussers and bartenders may reduce the total amount your waiter ultimately pockets.
NEXT: See our Holiday Tipping Tip Sheet to find out exactly how much you should give different service providers at the end of the year.