Restaurant business

[JenMO]

I'm new to the bookkeeping of a rest/bar type bookkeeping, mostly to do with the issue of tipping, allocated tipping, and percentages of what's allocated and how to report on 941 and W-2. Is there a good reference brochure or book or something that would help me?

[Mo Sheets]

Restaurants

Go out to the IRS website for most of the information you are looking for. I just started doing the payroll/tax filings/write-up for a local restaurant. There is ALOT of work involved. Some of the items I downloaded from the IRS website included:

Publication 15 (Circular E) Employer's Tax Guide
Form 941 Employer's Quarterly Federal Tax Return
Form 940 Employer's Annual Federal Unemployment (FUTA) Tax Return
Publication 1244 (Employee's Daily Record of Tips and Report to Employer)
Form 4070 Employee's Report of Tips to Employer
Form 4070A Employee's Daily Record of Tips
Form 4137 Social Security and Medicare Tax on Unreported Tip Income
Form 8027 Employer's Annual Information Return of Tip Income and Allocated Tips

A couple of things to remember...you need to make sure employees who are working as servers are making at least minimum wage (tips + hourly pay amount). I use a spreadsheet to calculate this every week. Also, you can go out to the Department of Labor website to see what the minimum amount is that can be paid to a server on an hourly basis (depends on the state).

Also, don't forget the various state items (withholding/sales tax/SUTA) if applicable to what you are handling for your client.

Good luck!

Mo

[JohnH]

Good response you got from Mo Sheets. I'll add a couple more which are very helpful.

http://www.irs.gov/businesses/small/article/0,,id=141487,00.html

http://www.irs.gov/businesses/small/industries/article/0,,id=185195,00.html

My only experience with restaurants goes back many years, because I got to the point that I quit accepting them as clients. I freely admit that I'm biased from having been stung, but my advice would be to charge them on the high side because they will be a constant source of aggravation, and get a good retainer.