San Diego Tax Lawyer Has Pointers for Tipped Workers
Are you someone who works in a restaurant as a bartender or a server? Maybe you deliver pizza, give people massages, or drive a taxi for a living. What do all of these completely different jobs have in common? They all receive tips. And with receiving tips comes a different kind of tax situation than if you were to not receive tips according to San Diego tax lawyer, Tax Tiger.
The basics
Basically the following happens:
- Keep track of your tips
- Report your tips to your employer
- Your employer includes those tips into your income through the payroll processing system
- Your W-2 will show this reported tip in Box 8
It’s as simple as that! But there are a few extra bits of information you may want to be aware of.
Here are a few pointers when it comes to your taxes:
- Don’t make that much in tips but still make tips? Don’t worry about reporting how much you make in tips to your employer if it’s less than $20 a month. But it should still be included in the income on your tax return.
- Do your best to keep track of all your tips. While it would make things easier if your employer kept track, it unfortunately doesn’t work that way. Use a journal, put the amounts in your phone, or find whatever way is best for you to easily record your tips so that when you need them for tax season – they are there.
- Remember, people in restaurants aren’t the only ones who need to report their tips. Hairdressers, performers, and so many more people out there receive tips and should make sure to report these.
Dealing with taxes isn’t easy, and when it comes to tips – it gets even more complicated! Tax resolution services in San Diego, Tax Tiger, wants to make sure that your taxes are perfect for tax season. If you were to do your own taxes and make a mistake, you may end up owing the Internal Revenue Service money. With the help of a tax lawyer in San Diego, you can feel at ease knowing that these IRS issues will be resolved.
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