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Level 2
Feb 27, 2026 8:08 PM UTC
Question

Tip deduction question

Hi, 

My employer listed all tip income in box 7, social security tips.  The issue is this amount also includes tips from the employer. Turbo tax asks if any tips were from the employer - yes and then disqualifies the deduction even though a significant portion are legitimate tips made from customers not associated with the employer.  I would like to include these tips, but turbo tax does not offer the option to do so.  Is there any way to do so?

    1 reply

    Alumni - Intuit
    Mar 1, 2026 4:48 PM UTC

    Since the rules on tips changed mid-year, employers are not required to report your tips separately, so most employers reported the tips on BOX 7 of your W2.   You can generally use the amount on Box 7 to determine your qualified tips. 

     

    If the amount that was reported on your Box 7, includes allocated tips, or service charges, you can make an adjustment. There is a question after you enter your W2 that asks if you need to change your tip amount.  You can enter the amount of tips that qualify in this question.  

    No Tax on Tips: How It Works in the One Big Beautiful Bill