ezAccounting software comes with the flexible payroll feature. If you own a restaurant, spa or a service company, you can process paychecks with wage and tips easily.
Case study: Restaurant
In a restaurant, servers and bartenders are often tipped directly by the customers they serve, in the form of cash. However as a business owner, you need to properly report the tips your employees collected. Here is the guide how to handle tips with the paycheck.
For example: You need to pay your waitress $95 today. And she already received $50 cash tips. So you need to report $145 to IRS. However, you just want to write her a paycheck for the $95.
ezAccounting payroll feature can handle it for you. Here are the steps:
Step 1. Add a new deduction "Paid Tips"
1.1 Start ezAccounting software
1.2 Click the top menu "Payroll/Employee", and then the sub menu "Deduction Setup" to view Company Deduction Setup screen.
1.3. Check the option box before one deduction that is not in use, and then click the "..." button behind it to view Deduction Details screen.
1.4. On Deduction Details screen, enter the "Paid Tips" for the "Decription" field. (Note: You can also use a different name.)
1.5 Leave the option box unchecked for "Deduction in percentage of wages".
1.6 Leave the option boxes unchecked for both "Exempt from Federal adn State Income Tax" and "Exempt from FICA Tax".
1.7 Click the "Save" button on Deduction Details screen.
1.8 Click the "Save" button on Company Deduction Setup screen to save the deduction.
Step 2: Add a paycheck
After you add this deduction, you will see a new deduction field in your paycheck screen. When you generate a new check, you just need to enter your hourly pay, tips and paid tips. ezAccounting will handle the taxes for you based on your set up and tax tables.
Report To IRS
When you file a report to IRS in the future, you can see both wage and tips there.
Below is a 941 sample
From $199
ezAccounting software is the right in house accounting solution for small businesses needing to document and report on incoming and outgoing cash flow including sales, receipts, payments and purchases. It also supports payroll processing and tax form printing.
If you have not installed this software, you can download and try it free with no obligation and no credit card needed.
This accounting software is compatible with Windows 11, 10, 8, 7, Vista and other Windows computers.
ezAccounting makes it easy to track income and cost!
