Tip Income

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multiham
Posts: 211
Joined: Sun Jan 08, 2017 11:28 am

Tip Income

Post by multiham » Sun Feb 10, 2019 9:35 pm

Our son (under age 18) took a job this year as a busser (he cleans the tables and brings out drinks) at a local restaurant. He makes minimum wage. The wait staff will also provide him with a small amount of tips each day. I have never worked in a tip receiving position before and just assumed that we would just add the tip amount to his tax return income. Now I'm reading that the restaurant should have captured this and that my son now has to file form 4137 which covers medicare and social security tax on unreported tips.
Any advice here on proper way to handle? He made about $1,500 in W2 wages and another $450 in tips.

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Rob5TCP
Posts: 3216
Joined: Tue Jun 05, 2007 7:34 pm
Location: New York, NY

Re: Tip Income

Post by Rob5TCP » Sun Feb 10, 2019 10:58 pm

This form provides pretty good instrusctions.
He is responsible to report any tips not reflected on his W2.

SS: The gross unreported tips times 6.2% (.062)
Medicare: The gross unreported tips times 1.45% (.0145)
You need to have both your son's SS # and his employers
business ID.

https://www.irs.gov/pub/irs-pdf/f4137.pdf

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