Wage expense states that it should be equal to Box 1 of the W3 form. HOwever Box1 includes reported tips. Reported tips should not be an expense should they? As the business owner, i did not pay that to the employee, the customers did. I did pay FUTA and social Security, medicare, etc on the tip amount. But, i dont get to claim all reported tips as an expense do I?
Am i missing something here? Do i need to have the reported tips offset, perhaps by showing the reported tips as income as well?
