Your tips are reported along with your salaries and wages on line 1 of Form 1040EZ, or on line 7 of either Form 1040A or 1040. If you kept a tip record and reported your tips to your employer, the amount that you would have to add to the amount shown in box 1 of your W-2 are the tips of less than $20 in a month, and the amount for items of value that were not cash, since you did not have to report either of these. But they still must be included on your income tax return.
Tips You Did Not Report to Your Employer
If you have tips that you should have reported to your employer but you did not report them, you will have to report the social security and Medicare tax on those unreported tips on your income tax return. In this case, you will have to complete Form 4137, Social Security and Medicare Tax on Unreported Tip Income. Form 4137 must be attached to your income tax return, and the tax calculated on that form is reported on the separate line for those taxes in the “Other Taxes” section of Form 1040.
Uncollected Social Security and Medicare Taxes
If your employer was not able to withhold all your social security and Medicare taxes from your regular pay and the taxes you reported, and you did not give your employer money to make up the difference, these uncollected taxes have to be reported on your income tax return. In this case you must file Form 1040, and not Form 1040EZ or 1040A. The taxes should be included in the line for total taxes (line 62 of Form 1040) and you would write “UT” and the amount of the uncollected taxes on the dotted line beside the total taxes amount.