Form 4070A

What Is Form 4070A: Employee's Daily Record of Tips?

Form 4070A is a tax form distributed by the Internal Revenue Service (IRS) that employees can use to keep track of the tips they receive from customers at work and report them to their employer. Form 4070A is like an exercise manual, with spaces for an employee to show the total amount of tips received from supporters.

Tips can incorporate cash left by customers, tips that customers add to debit or credit card charges, and tips paid to an employee by different employees through tip sharing, tip pooling, or different arrangements. Workers ought to record the total amount of tips they paid to different employees and the names of employees to whom the tips were paid.

Who Can File Form 4070A: Employee's Daily Record of Tips?

Form 4070A is a voluntary form that employees can use to keep a daily record of tips received to report the total to their employer every month. Workers who don't report their tips to employers utilizing Form 4070A must ascertain and pay Social Security and Medicare taxes on the unreported tips while filing their tax returns, utilizing Form 1040 and Form 4137: Social Security and Medicare Tax on Unreported Tip Income.

Records of tip income ought to be saved however long the information on them might be required in the administration of any Internal Revenue law.

Instructions to Fill Out Form 4070A: Employee's Daily Record of Tips

Form 4070A ought to be distributed to employees by the employer or got to through IRS [Publication 1244](/irs-bar 1244), which contains a year's supply of the form. Form 4070A has space for daily sections and assists the employee with totaling up tips for the month.

An employer must keep income, Social Security, and Medicare taxes on tips, and as a rule deduct the withholding due to tips from an employee's ordinary wages. [IRS Publication 531: Reporting Tip Income](/irs-bar 531) gives more insights regarding keeping a daily record of tips.

All pages of Form 4070A are accessible on the IRS website.

Special Considerations When Filing Form 4070A: Employee's Daily Record of Tips

Sporadically, rather than a cash or credit card tip, a customer might give an employee a non-cash tip, like passes to a game or other thing of value. For tax purposes, workers don't need to report non-cash tips to their employers or on a Form 4070A. Notwithstanding, the IRS considers non-cash tips as income. Thus, assuming that a customer tips an employee with two containers of wine valued at $50 each, the worker must claim that $100 value as income when they file their tax return.

This expects workers to keep dependable proof of the tip income they received, for example, duplicates of restaurant bills and credit card charges that show the amounts customers added as tips. Tips not reported to an employer as required may bring about a penalty of half of the Social Security and Medicare taxes that are due on the unreported tips.

Features

• Workers who don't report their tips to employers utilizing Form 4070A must compute and pay Social Security and Medicare taxes on unreported tips while filing their tax returns, utilizing Form 1040 and Form 4137.
• Employees use Form 4070A to keep track of the tips they receive from customers and report the total to their employer every month.
• Employees are not required to utilize Form 4070A to keep track of their tip income, yet the form is given by the IRS as a helpful method for doing as such.
• Workers ought to likewise record the total amount of tips they paid to different employees and the names of employees to whom the tips were paid.