| How Do I Make Sure My Restaurant is Following | | | | we want to give you practical resources to stay |
| IRS Tip Reporting Guidelines for 2010? | | | | abreast of the payroll tax filing requirements. |
| As a restaurant or bar owner, you know the | | | | 5 WAYS TO STAY INFORMED: |
| importance of staying abreast of tip and tax | | | | Besides understanding the tax laws in detail, it is |
| related laws? How do you do that? Tips are | | | | helpful to have a network of experts to get |
| subject to the full range of employment and | | | | answers from. Here are 5 ways successful |
| withholding taxes. They are compensation | | | | restaurant owners and managers stay informed: |
| received for services rendered by your | | | | - Become a member of a major restaurant |
| employees. | | | | industry association, such the National Restaurant |
| Here are the Top 3 reasons to make sure you | | | | Association or your state organization, such as |
| are up on the IRS guidelines for the Form 8027, | | | | the California Restaurant Association. Even your |
| “Employer’s Annual Information Return of | | | | city may have a local chapter. For example, San |
| Tip Income and Allocated Tips, with the IRS.” | | | | Diego has a local chapter of the CRA. They |
| 1. You operate a business where food or | | | | have mixers and meetings. Go with the intention |
| beverage tipping is customary | | | | of making 10 to 20 good contacts with |
| 2. you have greater than 10 employees | | | | non-competing restaurant owners, so that you |
| 3. Your food or beverage is sold for consumption | | | | may share industry knowledge. |
| on the premises | | | | 1. Other times, you can post to the group and |
| For a complete guide on tip income reporting rules | | | | get answers the next day. |
| from the IRS, read the instructions for IRS Form | | | | - You should also use the services of a good cpa, |
| 8027 and Publication 15, IRS Employer’s Tax | | | | and abookkeeping and accounting service, |
| Guide. You may find printable pdf versions of all | | | | often with QuickBooks® experience, who is |
| of the publications listed here by going online and | | | | knowledgeable in the tax laws surrounding the |
| searching for “IRS form _______” with | | | | restaurant and food service industry. |
| the form number in the blank space. | | | | 1. Specialists in the restaurant industry will have |
| Here are some other Forms and Reports that | | | | training, tools and education specific to restaurant |
| you should consider using with your Restaurant | | | | payroll taxation. |
| payroll: | | | | - And, remember to read and stay informed. |
| 1. On the “Employee’s Report of Tips to | | | | You are on the internet reading this article. You |
| Employers,” you, the restaurant owner, | | | | may find relevant article sites and blogs, |
| receives written proof each payroll period of the | | | | bookmark them, and check back once a month |
| of employee’s tips. | | | | for new information. Or, you can subscribe to |
| 2. FICA Tip Credit. IRS Form 8826. This tax | | | | RSS feeds from these sites to be kept |
| credit is a “general business credit.” Your | | | | up-to-date-on the latest information. |
| restaurant may be able to reduce federal income | | | | We hope this information is helpful to your |
| taxes by the amount of FICA (Social Security | | | | restaurant business! |
| and Medicare) taxes paid to employees on certain | | | | For more information, and to see how to better |
| tips. These FICA tax payments have to do with | | | | streamline the payroll tax and administrative side |
| FICA taxes you pay on tips beyond those tips | | | | of the business, you may contact Pink Payroll. |
| used as a “tip credit” to meet your | | | | We can answer a few questions, or provide you |
| requirement to pay employees the federal | | | | with a Quick Quote. |
| minimum wage. This is the 45(B) credit. In | | | | Tax laws change frequently, so use this |
| order to properly calculation this, it is a good | | | | information, but make your final business decision |
| practice to use an experienced restaurant payroll | | | | taking into account the current advice of your cpa |
| company who has the software and experience | | | | and payroll service. The information contained |
| calculating payroll tips, and the review of an cpa | | | | herein is for informational and educational |
| with restaurant tax experience. | | | | purposes only, and not tax filing purposes. |
| Now that you have details on Tax Tip Reporting, | | | | |