skip navigation
Search Help
Navigation Help

Tax Map Index
ABCDEFGHI
JKLMNOPQR
STUVWXYZ#

International
Tax Topic Index

Affordable Care Act
Tax Topic Index

Exempt Organization
Tax Topic Index

FAQs
Forms
Publications
Tax Topics
Worksheets

Comments
About Tax Map

IRS.gov Website
Publication 531
taxmap/pubs/p531-002.htm#en_us_publink100022538

Reporting Tips on Your Tax Return(p5)

rule
taxmap/pubs/p531-002.htm#en_us_publink100022539

How to report tips.(p5)

rule
Report your tips with your wages on Form 1040, line 7; Form 1040A, line 7; Form 1040EZ, line 1; Form 1040NR, line 8; or Form 1040NR-EZ, line 3.
taxmap/pubs/p531-002.htm#en_us_publink100022540

What tips to report.(p5)

rule
Generally, you must report all tips you received in 2017 on your tax return including both cash tips and noncash tips. Any tips you reported to your employer as required in 2017 are included in the wages shown in box 1 of your Form W-2. Add to the amount in box 1 only the tips you did not report to your employer.
However, any tips you received in 2017 that you reported to your employer as required after 2017 but before January 10, 2018, are not included in the wages shown in box 1 of your 2017 Form W-2. Don't include the amount of these tips on your 2017 tax return. Instead, include them on your 2018 tax return. Tips you received in 2016 that you reported to your employer as required after 2016 but before January 10, 2017, are included in the wages shown in box 1 of your 2017 Form W-2. Although these tips were received in 2016, you must report them on your 2017 tax return.
If you participate in a tip-splitting or tip-pooling arrangement, report only the tips you receive and retain. Don't report on your income tax return any portion of the tips you receive that you pass on to other employees. However, you must report tips you receive from other employees.
EIC
If you received $20 or more in cash and charge tips in a month and didn’t report all of those tips to your employer, see Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer, later.
EIC
If you didn’t keep a daily tip record as required and an amount is shown in box 8 of your Form W-2, see Allocated Tips, later.
If you kept a daily tip record and reported tips to your employer as required under the rules explained earlier, add the following tips to the amount in box 1 of your Form W-2.
taxmap/pubs/p531-002.htm#en_us_publink100022543

Example.(p5)

Ben Smith began working at the Blue Ocean Restaurant (his only employer in 2017) on June 30 and received $10,000 in wages during the year. Ben kept a daily tip record showing that his tips for June were $18 and his tips for the rest of the year totaled $7,000. He wasn’t required to report his June tips to his employer, but he reported all of the rest of his tips to his employer as required.
Ben's Form W-2 from Blue Ocean Restaurant shows $17,000 ($10,000 wages + $7,000 reported tips) in box 1. He adds the $18 unreported tips to that amount and reports $17,018 as wages on his tax return.
taxmap/pubs/p531-002.htm#en_us_publink100022544

Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer.(p6)

rule
If you received $20 or more in cash and charge tips in a month from any one job and didn’t report all of those tips to your employer, you must report the social security, Medicare, and Additional Medicare taxes on the unreported tips as additional tax on your return. To report these taxes, you must file Form 1040, Form 1040NR, Form 1040-PR, or Form 1040-SS (not Form 1040A, Form 1040EZ, or Form 1040NR-EZ) even if you won’t otherwise have to file.
Use Form 4137, Social Security and Medicare Tax on Unreported Tip Income, to figure social security and Medicare taxes and/or Form 8959, Additional Medicare Tax, to figure Additional Medicare Tax. Enter the tax(es) on your return as instructed, and attach the completed Form 4137 and/or Form 8959 to your return.
EIC
If you’re subject to the Railroad Retirement Tax Act, you can't use Form 4137 to pay railroad retirement tax on unreported tips. To get railroad retirement credit, you must report tips to your employer.
taxmap/pubs/p531-002.htm#en_us_publink100022546

Reporting uncollected social security, Medicare, Additional Medicare, or railroad retirement taxes on tips reported to your employer.(p6)

rule
You may have uncollected taxes if your regular pay wasn’t enough for your employer to withhold all the taxes you owe and you didn’t give your employer enough money to pay the rest of the taxes. For more information, see Giving your employer money for taxes, under Reporting Tips to Your Employer, earlier.
If your employer couldn’t collect all the social security and Medicare, and Additional Medicare taxes, or railroad retirement taxes you owe on tips reported for 2017, the uncollected taxes will be shown in box 12 of your Form W-2 (codes A and B). You must report these amounts as additional tax on your return.
If you worked in the U.S. possessions and received Form W-2AS, Form W-2CM, Form W-2GU, or Form W-2VI, any uncollected taxes on tips will be shown in box 12 with codes A and B. If you received Form 499R-2/W-2PR, any uncollected taxes will be shown in boxes 22 and 23. Unlike the uncollected portion of the regular (1.45%) Medicare tax, the uncollected Additional Medicare Tax isn't reported on Form W-2.
To report these uncollected taxes, you must file Form 1040NR, Form 1040-PR, or Form 1040-SS (not Form 1040A, Form 1040EZ, or Form 1040NR-EZ) even if you wouldn’t otherwise have to file. You can report these taxes on Form 1040, in the space next to line 62, or the corresponding line of Form 1040NR, Form 1040-PR, or Form 1040-SS (not Form 1040A, Form 1040EZ, or Form 1040NR-EZ). See the instructions for these forms for exact reporting information.
taxmap/pubs/p531-002.htm#en_us_publink100022547

Self-employed persons.(p6)

rule
If you receive tips as a self-employed person, you should report these tips as income on Schedule C or C-EZ. See Pub. 334, Tax Guide for Small Business, for more information on reporting business income.