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WASHINGTON — The Internal Revenue Service has extended a program that simplifies the recordkeeping burden for reporting tip income in the food and beverage industry for two more years.

The Attributed Tip Income Program, first announced in 2006 in Revenue Procedure 2006-30, was scheduled to expire on December 31. However, it has been extended to Dec. 31, 2011, under Revenue Procedure 2009-53.

Participating employers report tip income of employees based on a formula that uses a percentage of gross receipts, which are generally allocated among employees based on the practices of the restaurant. The IRS does not initiate a tip examination during the period the employer and employee participate in ATIP and participating employees do not have to keep a daily tip log or other tip records.

Employers elect to join the programby checking the designated box on Form 8027, Employer’s Annual Information Return of Tip Income and Allocated Tips. Employees only need to sign an agreement with a participating employer to have tip income computed under the program and reported as wages.

Last modified on Sunday, 02 June 2013
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