Restaurant clients with tipped employees have more complex payroll requirements than other clients. Years of experience in the food, beverage, and hospitality industry have given Paychex the opportunity to excel in offering unique services and reports for establishments with tipped employees.

Important payroll items include:

  • FICA Tip Credit Report – Paychex performs the calculations and compiles the data to assist restaurants in claiming a FICA Income Tax Credit. Our free report enables your client to claim the credit on Form 8846.
  • TEFRA Service For large food or beverage establishments, Paychex calculates tip allocations using IRS formulas to print tip allocation totals on employee W-2s.  Paychex also prepares Form 8027.
  • Employee Shortfalls and Deductions Not Taken This free report tracks occurrences when employees don’t earn enough wages to cover their taxes and deductions, giving your clients the opportunity to recover any uncollected funds from an employee’s next paycheck.
  • Tip Sign Off Report At no additional charge, Paychex automatically provides a record of tips reported by employees each pay period. This captures the necessary information to fulfill certain tip reporting obligations.
  • Time and Attendance, and Point of Sale Interface Solutions Paychex has software programs that make it easy to import payroll data from many popular business applications.
  • Organizational Reporting Paychex makes budgeting easier by allowing the restaurateur to segment employee-related payroll expenses by organization unit.


Brendan O’Donnell

Sales Consultant

Paychex, Inc.