Yes, the IRS technically requires you to report all income, including small cash tips, regardless of your employer's policy.
Since these tips weren't reported to your manager, they won't be on your Form W-2. You’ll need to estimate the total amount you received during the 2025 portion of your employment. On your tax return (Form 1040), you’ll report these as "unreported tip income."
You will need to fill out IRS Form 4137 - TurboTax will create it for you based on the information you provide. This form calculates the taxes your employer didn't withhold from those tips. If you received less than $20 in tips in a single month, you aren't required to report them to your employer, but you are still legally required to report them as income on your tax return.
2024 Return - Legally, you should report all income. You should file Form 1040-X to amend your 2024 return if you left out income.
If the amount was very small (e.g., $50–$100 total for the year), the tax impact is likely negligible.
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