Reporting Tip Income with Form 8027 Software

If you’re an experienced restaurant manager/owner, you’re probably already aware that reporting tip income is mandated by the IRS. But what you may be learning about and preparing for the first time is the actual filing form that documents these food and beverage receipts and tips. Even long-time restaurant owners may be relatively unfamiliar with this form if they’ve recently expanded their location. That’s because one of the most common exemptions for this filing requirement is average staff size: A restaurant that doesn’t average a ten employee staff on a typical day can bypass this filing form.

Form Instructions

Before we introduce you to Form 8027 software from Advanced Micro Solutions (AMS), we want to make sure you know what to expect from the form itself. One of the most frustrating things can be when you spend a bunch of precious time preparing the form only to realize you never had to do it in the first place. Likewise, you don’t want to fill out the form incorrectly. The good news is that the IRS offers pretty clear guidance on who, when, and how to file this form for reporting tip income.

Reporting Tip Income of Different Types

One of the big things that Form 8027 does is break out the different types of tip income. In other words, it will ask you how much of this income was paid to directly tipped employees (as is customary with servers) as well as indirectly tipped employees (such as cooks, bartenders, bussers, and hosts). It will ask you to account for any added service charges if your restaurant has an automatic gratuity policy or some other charge that is then distributed to your employees. It will ask you to account for total charge receipts as well as gross receipts from food and beverage. It will also ask you whether you use hours-worked or gross receipts for the allocation of tips provided to your employees.

Form 8027 Software from AMS

Our form 8027 software is built on our foundational Forms Filer platform. This intuitive, menu-driven software provides powerful data importing, entry, reporting, and printing features. We make it easy to prepare your W-2s and 1099 forms. From there, our Forms Filer Plus module offers targeted support for Form 8027, as well as your local- and state-based employer filing requirements.

Reporting tip income is an essential part of running a restaurant business. You need to stay in compliance with state law, but you also need to provide accurate information and payroll processing with restaurant payroll software. With our software modules, you can easily manage your payroll, e-file, and even print your own MICR checks and blank filing forms. Check out all our products and download our free demo to see AMS accounting software in action. When you’re ready you can buy an AMS software solution directly online or talk to Sales and Information at (800) 536-1099.

Payroll Software

  • Software-Generated Forms
  • E-File Direct
  • Affordable Care Act Filer
  • 1042-S Filer

Software Solutions from AMS

Our W-2 and 1099 Forms Filer is our only required platform. From there, users pick the services they need. Choose from the tools below to build out your customized accounting software.