Waitresses must claim all tips they make on their income tax returns, according to the Internal Revenue Service. The IRS suggests that waitresses paid in tips keep a daily tip diary to keep track of tips and simplify the reporting process. The IRS makes Form 4070A, Employees Daily Record of Tips, available for waitresses to ensure accuracy of tip reporting.
Form 4070A features a fill-in-the-blank format for recording daily tips. To request this form, ask the IRS for Publication 1244. The publication includes an entire year's supply of the form.
Waitresses that do not wish to use Form 4070A can keep their own records or diaries of the tips they receive. Records should include information regarding cash tips received each day, tips from credit or debit cards received, and the value of any noncash tips that are received. Money paid through tip pools or by tip-splitting arrangements should also be reported, notes the IRS.
Waitresses should not write down the service charge that the employer pays, since this is treated as wages, even though it is charged to a customer's bill. To be considered a tip, money must be given to the waitress free from compulsion and be determined by the customer; it cannot be dictated by the employer and the customer can determine who it is given to. Otherwise, it is not a tip under IRS guidelines.