Allocated Tips on my tax form - Is this section 8 amount correct?

Wait so does this mean they think im not reporting enough tips? Should I be worried about an audit or something? I always thought our restaurant handled all the tip reporting since we pool.

The allocation doesn't necessarily mean you personally underreported. It's just that the IRS expects a certain percentage of gross sales to be reported as tips across the entire establishment. If that threshold isn't met, the employer must allocate the difference. Regarding audit concerns, it's always best to report your actual tips accurately. If your actual tips were higher than what's in box 8, you should report that higher amount. If your actual tips were lower, you may want to keep good records of your actual tip income in case of questions. Many restaurants with pooling systems should have documentation of what was distributed to you.

How does this work exactly? Does it just explain the form or does it actually help you calculate what you should be reporting vs what the employer put in box 8?

Sounds interesting but I'm skeptical. Wouldn't you need actual records of your tips to prove anything? Not sure how an app would know what you really made vs what your employer reported.

It actually breaks down everything line by line and explains what each section means for your specific tax situation. It doesn't just explain the form - it gives you actionable advice on how to proceed and what documentation you might need. For your question about records, it actually recommends exactly what documentation you should keep to support your position if your actual tips were different than what was allocated. It also has a feature that helps you reconstruct your tip income if you don't have perfect records, which was super helpful for me.

How does this actually work? Ive tried calling the IRS like 5 times this month and just get the automated message saying they're too busy.

Yeah right. No way this actually gets you through to the IRS during tax season. Sounds like just another scam trying to get money from desperate people. The IRS phone lines are literally impossible right now.

The service basically holds your place in line with the IRS and calls you back when an agent is available to talk. It works with their phone system to navigate the menus and wait times so you don't have to. They definitely do get through - that's literally their whole service. They don't do anything else besides connect you with the actual IRS. I was super skeptical too because I'd wasted so many hours trying to get through myself, but it worked exactly as promised. I talked to a real IRS agent who answered all my questions about allocated tips and my specific situation.

Thanks for the insight! I actually have been keeping a tip journal (just in my notes app), but it's definitely not matching what they put in box 8. Should I just report what I actually made according to my records? And will that cause problems with the IRS since it doesn't match my W-2?

Absolutely report what you actually made according to your records. That's what the law requires - you pay taxes on your actual income, not some arbitrary allocation. Keep your notes app records and any documentation from your employer showing the tip distributions from the pool. If there's a significant difference between your records and the box 8 amount, it might be worth discussing with your employer first to understand how they calculated it. Sometimes there are simple errors that can be corrected with an amended W-2.

Unfortunately not anymore. The tax law changes from a few years back eliminated most unreimbursed employee expense deductions. Used to be you could deduct those under miscellaneous itemized deductions but that's gone now. Some states still allow it on state taxes tho.