What are allocated tips?
Allocated tips are tips your employer assigns to you as shown in Box 8 of your W-2. They are in addition to the tips you reported to your employer (which are included with your wages in Box 1). Restaurants, cocktail lounges, and similar businesses must allocate tips to an employee if the amount of tips reported by the employee was less than a certain percentage of sales.
Enter your allocated tips here: Menu Path: Income > Common Income > Wages (W-2), Box 8
Also enter them here: Menu Path: Income > Uncommon Income > Unreported Tips
Since allocated tips aren't included in the amount in Box 1 of your W-2, they're entered separately and reported on Form 4137.
When would I report actual unreported tips instead of allocated tips?
Enter your allocated tips here: Menu Path: Income > Common Income > Wages (W-2), Box 8
Also enter them here: Menu Path: Income > Uncommon Income > Unreported Tips
Since allocated tips aren't included in the amount in Box 1 of your W-2, they're entered separately and reported on Form 4137.
When would I report actual unreported tips instead of allocated tips?
