Employers who are required to report tips to the Social Security Administration (and IRS) via Form 941 and Forms W-2 can set the employer payroll record to reflect this requirement.

When entering company information, go to the Group tab. If more than one group is present,

select the proper group. Now, select "Edit Payroll Columns".

At the payroll column screen, you want to add income categories for the tip categories you are required to report. These categories will determine how the tips are reported on the proper form, line, box, etc.

To choose the method of reporting, set the payroll column type by clicking on the right arrow on the "Type" box.

Choose from the following:

1. T1 - Allocated tips. Reported on box 8 of Form W-2. Not reported on Form 941. Not included in Box 1 of Form W-2.
2. T2 - Straight tips. This is handled by action of the taxability flags. You must set the taxability flags in accordance with how you want the tips reported.
3. T3 - FICA tips. Tips on which FICA tax has been withheld. Reported on line 6c of Form 941 and Box 7 of Form W-2. Included in Line 2 of Form 941 and Box 1 of Form 941.