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Allocated Tips W2 ~ Ultra Tax Creative Solutions

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    Allocated Tips W2 ~ Ultra Tax Creative Solutions

    We all seem to love our tax software. My software does a great job of correcting mistakes quickly and making the system easier to use each year.

    Rarely, a hairstylist or waiter has allocated tips on the w2. It seems LaCerte, Drake, {old timers know Taasc} and some others automatically make certain assumptions for the form 4137 which we can do an override if not correct.

    Ultra Tax seems to do very little when allcoated tips are entered on the W2.

    I'm curious to hear different points of view. Personally I think Ultra Tax is missing the boat on how they handle this matter, but I do understand they have a skilled design team and they certainly have reasons for everything they do.

    Vic Ferrari

    Tax Software

    Personally, I would prefer the software NOT make assumptions. When it comes to data that has a number of different possibilities, I want to make the decision as to what to do with it, rather than have to fight with the software trying to override its decision.

    I was a big fan of Mac-In-Tax, from back in the early 90’s prior to it being purchased by Turbo Tax. Mac-In-Tax was basically a fill in the form as you see it program. You entered stuff right on the 1040. No need for worksheets.

    Of course I date myself, because those of us who use to fill out returns by hand were very hesitant to let the software do stuff for us when we first started using computers. I still have the calluses on my finger from back in the 80’s when I did tax returns by hand.


      Allocated Tips w Ultra Tax Software

      How does other software handle allocated tips?
      W2 Box 1 7651.27
      W2 Box 2 520.88
      W2 Box 3 4953.22
      W2 Box 4 474.38
      W2 Box 5 7651.27
      W2 Box 6 110.94
      W2 Box 7 2698.05
      *W2 Box 8 1401

      I think LaCerte and others do a better job than Ultra Tax in this area.
      I think the following:

      Form 4137 line 1 should default to W2 box 7 plus W2 box 8
      Form 4137 line 2 should default to W2 box 7
      The defaults can be over rode when necessary.

      Ultra Tax provides a diagnostic but I was curious how other software vendors did allocated tips.