Form 4137, Social Security and Medicare Tax on Unreported Tip Income

Instructions and help about Form 4137, Social Security And Medicare Tax On Unreported Tip Income

all right for this video i wanted to cover the irs form 4137 this is typically included with a form 1040 filing if you have compensation that was not subject to social security or medicare taxes at source okay so i've got one slide in front of us with the rules and an example and then a sample form 4137 that's going to be completed by our taxpayer here so under u.s tax rules when the taxpayer generates income from tips that is included in their taxable compensation right so bartenders waiters la drivers et cetera they're all required to report this tip income and include in their gross income and you'll find those standards under irc sections 1 and then 61.8 right so all u.s tax residents report gross income from whatever source derived that's the standard so if an employee at a location receives tip income nowadays the the employees generally require to report those tips to the employer and then the employer knows to add that into their taxable compensation so it could be subject to s