Form 4137 (2019)
Page 2
Who must file. You must file Form 4137 if you
received cash and charge tips of $20 or more
in a calendar month and didn’t report all of
those tips to your employer. You also must file
Form 4137 if your Form(s) W-2, box 8, shows
allocated tips that you must report as income.
Allocated tips. You must report all your tips
from 2019, including both cash tips and
noncash tips, as income on Form 1040 or
Form 1040-SR, line 1; Form 1040-NR, line 8;
or Form 1040-NR-EZ, line 3. Any tips you
reported to your employer in 2019 are
included in the wages shown on your Form
W-2, box 1. Add to the amount in box 1 only
the tips you received in 2019 and didn’t report
to your employer. This should include any
allocated tips shown on your Form(s) W-2,
box 8, unless you have adequate records to
show that your unreported tips are less than
the amount in box 8. Although allocated tips
are shown on your Form W-2, they aren’t
included in box 1 on that form and no tax is
withheld from these tips.
Tips you must report to your employer. If
you receive $20 or more in cash tips, you
must report 100% of those tips to your
employer through a written report. Cash tips
include tips paid by cash, check, debit card,
and credit card. The written report should
include tips your employer paid to you for
charge customers, tips you received directly
from customers, and tips you received from
other employees under any tip-sharing
arrangement. If, in any month, you worked for
two or more employers and received tips
while working for each, the $20 rule applies
separately to the tips you received while
working for each employer and not to the total
you received. You must report your tips to
your employer by the 10th day of the month
following the month you received them. If the
10th day of the month falls on a Saturday,
Sunday, or legal holiday, give your employer
the report by the next business day. For
example, because May 10, 2020, is a Sunday,
you must report your tips received in April
2020 by May 11, 2020.
Employees subject to the Railroad
Retirement Tax Act. Don’t use Form 4137 to
report tips received for work covered by the
Railroad Retirement Tax Act. To get railroad
retirement credit, you must report these tips
to your employer.
Payment of tax. Tips you reported to your
employer are subject to social security and
Medicare tax (or railroad retirement tax),
Additional Medicare Tax, and income tax
withholding. Your employer collects these
taxes from wages (excluding tips) or other
funds of yours available to cover them. If your
wages weren’t enough to cover these taxes,
you may have given your employer the
additional amounts needed. Your Form W-2
will include the tips you reported to your
employer and the taxes withheld. If there
wasn’t enough money to cover the social
security and Medicare tax (or railroad
retirement tax), your Form W-2 also will show
the uncollected tax due in box 12 with codes
A and B. See the instructions for Schedule 2
(Form 1040 or 1040-SR), line 8, or Form
1040-NR, line 60, to find out how to report the
tax due. If you worked in American Samoa,
Guam, or the U.S. Virgin Islands, the amount
of uncollected tax due is identified in box 12
on Form W-2AS, W-2GU, or W-2VI with
codes A and B. If you worked in Puerto Rico,
Form 499R-2/W-2PR, boxes 22 and 23, show
the uncollected tax due. Unlike the
uncollected portion of the regular (1.45%)
Medicare tax, the uncollected Additional
Medicare Tax isn’t reported on Form W-2,
box 12, with code B.
Penalty for not reporting tips. If you didn’t
report tips to your employer as required, you
may be charged a penalty equal to 50% of
the social security, Medicare, and Additional
Medicare Taxes due on those tips. You can
avoid this penalty if you can show (in a
statement attached to your return) that your
failure to report tips to your employer was due
to reasonable cause and not due to willful
neglect.
Additional information. See Pub. 531,
Reporting Tip Income. See Rev. Rul. 2012-18
for guidance on taxes imposed on tips and
the difference between tips and service
charges. You can find Rev. Rul. 2012-18,
2012-26 I.R.B. 1032, at www.irs.gov/
irb/2012-26_IRB#RR-2012-18.
Specific Instructions
Line 1. Complete a separate line for each
employer. If you had more than five
employers in 2019, attach a statement that
contains all of the information (and in a similar
format) as required on Form 4137, line 1, or
complete and attach line 1 of additional
Form(s) 4137. Complete lines 2 through 13 on
only one Form 4137. The line 2 and line 3
amounts on that Form 4137 should be the
combined totals of all your Forms 4137 and
attached statements. Include your name,
social security number, and calendar year
(2019) on the top of any attachment.
Column (a). Enter your employer’s name
exactly as shown on your Form W-2.
Column (b). For each employer’s name you
entered in column (a), enter the employer
identification number (EIN) or the words
“Applied For” exactly as shown on your Form
W-2.
Columns (c) and (d). Include all cash and
charge tips you received. All of the following
tips must be included.
• Total tips you reported to your employer on
time. Tips you reported, as required, by the
10th day of the month following the month
you received them are considered income in
the month you reported them. For example,
tips you received in December 2018 that you
reported to your employer after December 31,
2018, but by January 10, 2019, are considered
income in 2019 and should be included on
your 2019 Form W-2 and reported on Form
4137, line 1. Report these tips in column (d).
• Tips you received in December 2019 that you
reported to your employer after December 31,
2019, but by January 10, 2020, are considered
income in 2020. Don’t include these tips on line
1 for 2019. Instead, report these tips on line 1,
column (d), on your 2020 Form 4137.
• Tips you didn’t report to your employer on
time. Report these tips in column (d).
• Tips you didn’t report at all (include any
allocated tips (see Allocated tips, earlier)
shown in box 8 on your Form(s) W-2 unless
you can prove that your unreported tips are
less than the amount in box 8). Report these
tips in column (c). These tips are considered
income to you in the month you actually
received them. For example, tips you received
in December 2019 that you reported to your
employer after January 10, 2020, are
considered income in 2019 because you
didn’t report them to your employer on time.
• Tips you received that you weren’t required
to report to your employer because they
totaled less than $20 during the month.
Report these tips in column (c).
Line 5. Enter only the tips you weren’t
required to report to your employer because
the total received was less than $20 in a
calendar month. These tips aren’t subject to
social security and Medicare tax.
Line 6. Enter this amount on Form 8959, line
2, if you’re required to file that form.
Line 8. For railroad retirement (RRTA)
compensation, don’t include an amount
greater than $132,900, which is the amount
subject to the 6.2% rate for 2019.
Line 10. If line 6 includes tips you received for
work you did as a federal, state, or local
government employee and your pay was
subject only to the 1.45% Medicare tax,
subtract the amount of those tips from the line
6 amount only for the purpose of comparing
lines 6 and 9. Don’t reduce the actual entry on
line 6. Enter “1.45% tips” and the amount you
subtracted on the dotted line next to line 10.
Line 11. Multiply the amount on line 10 by
0.062 (the social security rate for 2019).
Line 13. Form 1040-SS and Form 1040-PR
filers, include the amount from line 13 on
Form 1040-SS or Form 1040-PR, line 6. See
the instructions for Form 1040-SS or Form
1040-PR for more information.
