Table of Contents
For the latest information about developments related to Pub. 531, such as legislation enacted after this publication was published, go to www.irs.gov/pub531.
For 2016, the maximum wages and tips subject to social security tax remains at $118,500. The social security tax rate an employee must pay on tips remains at 6.2% (0.062).
$125,000 if married filing separately,
$250,000 if married filing jointly, or
$200,000 for any other filing status.
An employer is required to withhold Additional Medicare Tax on any Medicare wages or RRTA compensation it pays to an employee in excess of $200,000 in a calendar year without regard to the employee's filing status.
Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.
This publication is for employees who receive tips.
All tips you receive are income and are subject to federal income tax. You must include in gross income all tips you receive directly, charged tips paid to you by your employer, and your share of any tips you receive under a tip-splitting or tip-pooling arrangement.
The value of noncash tips, such as tickets, passes, or other items of value, is also income and subject to tax.
Keep a daily tip record.
Report tips to your employer.
Report all your tips on your income tax return.
This publication will explain these three things and show you what to do on your tax return if you have not done the first two. This publication will also show you how to treat allocated tips.
Internal Revenue Service
Tax Forms and Publications
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