Tips earned are taxable but is there a % of how much I should report to IRS or my employer? let's say I earned $100 for tips, should I report the whole amount or can I report $80 only?
2007-08-07 03:22:13 · 3 answers · asked by aiphstudent 1 in Business & Finance ➔ Taxes ➔ United States
You're supposed to report the full amount, but few do. I've attached a link about tip reporting.
2007-08-07 03:57:35 · answer #1 · answered by Anonymous · 2⤊ 0⤋
The percent is 100%. If you get $100 in tips, then you report $100.
Some employers advise employees to report lower amounts. If that happens, the employer is advising you to do something illegal, and you AND they can end up in trouble over it.
If you don't report all of your tips to your employer, you are required to report the rest of them on your tax return.
The IRS is aware that any cash area like tips has a lot of cheating going on for taxes, and does auditing in those areas.
2007-08-07 10:33:13 · answer #2 · answered by Judy 7 · 1⤊ 0⤋
You report all tips as income on your tax return.
Any month you make $20 or more in tips at a job, the tips are reported to your employer so he can withhold Social Security and Medicare taxes on your tips.
2007-08-07 10:26:39 · answer #3 · answered by ninasgramma 7 · 1⤊ 1⤋