Q&A of the Week June 29, 2022

Question

Do I need to report the tips that I receive from customers on my tax return?

Answer

Yes! Tips are taxable and need to be included in your gross income.

Tip income includes tips that come directly from customers, tips that are added using a credit card, and tips from a tip-splitting arrangement.

Make sure that your tip income is reported correctly on your tax return by keeping a daily tip record and reporting your tips to your employer.