EPY: Does the Tip Credit Calculation Provide the Data Needed to Complete IRS Form 8846? (Doc ID 1167626.1)

Last updated on DECEMBER 18, 2015

Applies to:

PeopleSoft Enterprise HCM Payroll for North America - Version 8 SP1 and later
Information in this document applies to any platform.

Goal

Currently, the calculation of the 'Tip Credit' in PeopleSoft is based on the difference between the current State/Federal minimum wage less the actual employee hourly rate paid.

Based on IRS documentation for IRS Form 8846 - Credit for Employer Social Security and Medicare Taxes Paid on Certain Employee Tips (2009), this amount should be calculated based on $5.15 per hour rather than the current minimum wage.

Solution

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