FICA Tip Tax Credit
The FICA Tip Tax Credit is a valuable federal incentive that lets employers in industries with tipped workers—like restaurants, bars, and hospitality—recover the Social Security and Medicare taxes they’ve paid on employee tips. This credit gives money back to taxpayers as a dollar-for-dollar reduction in their federal tax liability. For many employers, it means tens of thousands of dollars in annual savings that can be reinvested into staff, operations, or growth. Best of all, claiming it is straightforward making it one of the most overlooked but impactful credits available to service-based businesses.
Who Qualifies?
If your business receives tips from customers, you may be eligible! Common industries include:
- Restaurants & Bars Fast Food Franchises
- Food Trucks & Catering Services Hotels, Resorts & Casinos Breweries, Wineries & Distilleries
- Museums, Zoos, & Convention Centers
Key Benefits:
- Dollar-for-dollar tax reduction
- Significant annual savings
- Retroactive claims – claim refunds for up to three years of prior tax filings
- No impact on employees – staff still keep all of their tips; the credit only applies to the employer’s portion of payroll taxes.
Unlocking this credit is simpler than most business owners realize, and the savings can make a real difference to your bottom line. Don’t leave money on the table—contact us today to see how much you could save with the FICA Tip Tax Credit and start putting those dollars back into your business.