The FICA tip credit

YOU'RE OVERPAYING TAX ON EVERY tip.

The FICA tip credit is a federal break that refunds part of the payroll tax you've been paying on the tips your staff report. It's real money, it's been on the books since the nineties, and most restaurants either don't know about it or aren't claiming it cleanly. We do, every period.

A CPA who owns restaurants. Reno, NV.

Why it gets missed

The credit is sitting there. Is anyone claiming it?

Does your CPA even mention it?

Generalist firms file your return and move on. The tip credit takes restaurant know-how, and if nobody on your team has it, the credit just stays unclaimed year after year.

Is your tip reporting clean enough?

The credit only works when the underlying tip reporting is accurate and reconciled. If POS tips don't line up with payroll, the credit isn't defensible. The cleanup is the unglamorous half of this job.

Are you claiming prior years?

In many cases the credit can be captured retroactively, within IRS limits. We look back as far as we're allowed, because the savings tend to be bigger than people expect.

Are you stacking it with other savings?

The tip credit is one move. Pair it with the right depreciation, the right deductions, and a year-round plan, and the tax conversation stops being a once-a-year scramble.

How VAST claims it

From messy tips to money back.

We turn the raw tip data into a credit that holds up, then make sure the same thing happens automatically every year you work with us.

Calculate the exact credit

Not a rule-of-thumb estimate. We run the actual credit against the statutory wage floor, with the per-employee detail the IRS expects to see.

Clean up tip reporting

POS to payroll reconciliation, period by period, so the underlying numbers are defensible if anyone ever asks to see them.

File it correctly

The credit goes on the right form, with the right documentation, on time. Nothing about this is dramatic. It just has to be done right.

Look back where allowed

Within IRS lookback windows, we review prior years for credits that may still be recoverable. Most operators are surprised what's still on the table.

Stack every break

Tip credit plus accelerated depreciation plus the day-to-day deductions. The point isn't one big save, it's that every break compounds.

Keep you compliant

Tipped-wage rules are easy to get wrong. We keep the compliance clean while you keep more of what you legally can.

Tanya McCaffery, CPA ,  founder of VAST
Meet Tanya McCaffery, CPA

A CPA who actually owns restaurants.

Tanya is Founder & CEO of VAST and Co-Owner & CFO of Local Food Group , a multi-unit Reno restaurant group. She's built and operated brick-and-mortar restaurants and reviewed thousands of restaurant P&Ls. She reads your numbers like a line cook reads a ticket.

CPA20+ YearsB.S. Accounting, UNRRestaurant OwnerFractional CFO
Great Basin BrewingLiberty Food & WineCucina LupoPizzeria LupoOverland
“They are intentional, thorough, and have set us up for more success than I ever thought possible. If I could give more than 10/10, I would.”
Nenada Maslovaric · Old Barrel Tea Company

Questions, answered.

Who qualifies for the FICA tip credit?
Most food-and-beverage employers with tipped staff whose tips push pay above the federal minimum threshold. If you have servers or bartenders reporting tips and you've been quietly paying payroll tax on those tips, it's worth checking. Most restaurants qualify.
How big can the credit be?
It scales with tip volume and the size of your tipped staff. The calculator above gives you the rough shape. The exact number depends on your real reporting, but it's not unusual for a single location to recover several thousand a year, with multi-unit operators landing in five or six figures.
Do I need to switch accountants to claim it?
Not necessarily. We can claim it as part of a full engagement, or we can assess it during an intro call and tell you honestly what you'd save. Either way you'll know where you stand.
Can I claim it for past years?
Often yes, within IRS lookback limits. When we onboard, the first thing we do is review your filings to see what's still recoverable. The number is usually worth the look.
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