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Federal Form 8027

The Federal Employers Annual Info Return of Tips, TAX-8027, is the Employers Annual Info Return of Tips Tax Return. The report displays the current system date next to the signature line.

According to the IRS Instructions for Form 8027 in 2015, "Form 8027 is used by large food or beverage establishments when the employer is required to make annual reports to the IRS on receipts from food or beverage operations and tips reported by employees." 

The employer's receipts from food and beverage purchases are required for reporting purposes and aren't recorded as part of payroll processing. Process the report from a client-server program, such as Enterprise Client, and be prepared to enter the following values:

• Reporting Year
• Charge Receipts
• Service Charges for Line 3 of the annual Form 8027
• Gross Receipts for Line 2 of the annual Form 8027

Instructions for how to generate Form 8027 follow the illustration and summary of lines on Form 8827.

Federal Employers Annual Info Return of Tips, TAX-8027

Summary of Form 8027

The following is a summary of lines on the TAX-8027.

• Line 1 of the 8027 tip report = total “charged tips for the calendar year.”
• Line 2 of the 8027 tip report = “Charge Receipts” from food and beverage sales, as entered when the report was generated
• Line 3 of the 8027 tip report = “Service Charges” from food and beverage sales, as entered when the report was generated
• Line 4a of the 8027 tip report = total indirect tips
• Line 4b of the 8027 tip report = total direct tips
• Line 4c of the 8027 tip report = Line 4a + Line 4b
• Line 5 of the 8027 tip report = “Gross Receipts” from food and beverage sales, as entered when the report was generated
• Line 6 of the 8027 tip report = “Gross Receipts” from food and beverage operations multiplied by 8% = Allocated tips 
• Line 7 of the 8027 tip report = Line 6 – Line 4c
• The Line 7a checkbox and amount, Line 7b, and Line 7c, aren't system calculated. To report these values, manually mark the appropriate checkbox and complete the amount (if applicable).
• Line 8 of the 8027 tip report = number of directly tipped employees, specifically those employees who were paid an earning setup as a direct tip.
• Date on the 8027 tip report =  the current system date displays next to the signature line.

How to Generate Form 8027

This report is available through the Enterprise Client program.

1. Log into the Enterprise Client program, and go to the Report Navigator.
2. From the TAXFORMS category, select TAX-8027. A window displays, "Enter Parameter Values" with a list of parameters. Define each parameter before you click OK.
3. The first parameter selected is Reporting Year. Also, "Please Select Payroll Calendar Reporting Year, in the Discrete Value selection list. The default discrete value is Payroll Calendar Year 2004. Leave the default, or enter the digits for the year. The system validates the year and lists the year as Payroll Calendar Year followed by the numeric year.
4. Where Charged Tips Earning Selection is selected in Parameter Fields, the instructions display "Please enter Earning Codes Separated by a Comma for Charged Tips Wages Paid." Enter the currency value (without dollar sign) according to the instructions.
5. Where Charged Receipts is selected in Parameter Fields, the instructions display "Enter Total Amount of Charge Receipts Showing Charged Tips." Enter the currency value (without dollar sign) according to the instructions.
6. Where Service Charges is selected in Parameter Fields, the instructions display "Enter Total Amount of Service Charges of Less Than 10% Paid as Wages." Enter the dollar amount (without dollar sign) according to the instructions.
7. Where Indirect Tips Earnings Selection is selected in Parameter Fields, the instructions display "Please Enter Earnings Codes Separated by a Comma for Indirect Tips Wages Paid." Enter the earning code or codes as noted in the instructions.
8. Scroll down to view the additional parameters.
9. Where Direct Tips Earning Selection is selected in Parameter Fields, the instructions display, "Please Enter Earning Codes Separated by a Comma for Direct Tips Wages Paid." Enter the earning code or codes as described in the instructions.
10. Where Gross Receipts is selected in Parameter Fields, the instructions display, "[R]eceipts Amount from Food or Beverage Operations." Enter the dollar amount as described in the instructions.
11. You can review the Discrete Value for each parameter field by using your mouse to click on each parameter in the Parameter Fields list.
12. Click on OK. The report displays in the report viewer.

You can print the report. Verify the report, marking checkboxes as needed, and then remit the report where and when applicable for the company.