There is no way to get a credit or deduction for tip-outs on your tax return. The tip-outs are not supposed to be included in your W-2. It sounds like your employer now understands that and has started to do it correctly. For 2024 you have to get a corrected W-2 from your employer that does not include the tip-outs.
If the employer refuses to correct the W-2, you can use a substitute W-2, Form 4852, to enter the correct information in your tax return. When you enter the W-2 in TurboTax, enter the correct information instead of what's on the W-2 from the employer. After you enter the W-2 information, you will get a screen that says "Let's check for uncommon situations." Check the box for "Didn't get a W-2" (even though that's not your situation) and click Continue. The following screens ask if you want to complete Form 4852. Select Yes and proceed through the screens, entering the requested information to complete Form 4852. It will ask you to enter explanations of what you did to try to get a correct W-2 from your employer, and how you calculated the amounts that you entered. The prompts on the TurboTax screens assume that you didn't get a W-2 at all, but that's not what the actual Form 4852 says. The form says to explain your efforts to obtain an original or corrected Form W-2, and how you determined the amounts that you entered.
