Instructions For Form 8027 - 2016 (Page 2 of 8) in pdf

Form 8027 attachments if filing on paper. If applicable,

1. Enter one-half of the total employee hours worked

attach a copy of your timely filed Form 8809, a copy of your

during the month in 2015 with the greatest

aggregate gross receipts from food and

approved waiver (Form 8508) from filing Form 8027

beverages.

electronically, and a copy of your “lower rate” determination

. . . . . . . . . . . . . . . . . . . . . . . .

letter from the IRS. Don't attach any other documents.

2. Enter the number of days opened for business

during the month shown in line 1.

. . . . . . . . . .

Reporting and filing electronically. If you're the employer

3. Enter one-half of the total employee hours worked

and you're required to file 250 or more Forms 8027, you must

during the month in 2015 with the least aggregate

file the returns electronically. See Pub. 1239 for information

gross receipts from food and beverages.

on filing Form 8027 electronically.

. . . . .

4. Enter the number of days opened for business

Penalties

during the month shown in line 3.

. . . . . . . . . .

The law provides for a penalty if you don't file Form 8027

5. Divide line 1 by line 2.

. . . . . . . . . . . . . . . . .

(and Form 8027-T) on time unless you can show reasonable

6. Divide line 3 by line 4.

. . . . . . . . . . . . . . . . .

cause for the delay. In addition, if you don't complete an

accurate Form 8027, you won't be able to correctly prepare

7. Add lines 5 and 6. If line 7 is greater than 80 (hours),

Form W-2, Wage and Tax Statement, for each directly tipped

you must file Form 8027 for 2016.

. . . . . . . . .

employee for whom a tip allocation was required to be made.

You may be charged penalties for each failure to:

Timely file a correct information return (Forms 8027 and

If your answer on line 7 of the worksheet is more than 80

W-2) including failure to file electronically if required, and

hours, then you meet the 10-employee test.

Timely furnish a correct Form W-2 to the employee.

If you meet the 10-employee test, file a separate

For more information on penalties for untimely or incorrect

Form 8027 for each food or beverage operation

Forms W-2 or 8027, see Pub. 1239 and the General

where tipping is customary. This is true even if an

CAUTION

Instructions for Forms W-2 and W-3.

individual operation, when considered separately, doesn't

have more than 10 employees on a typical business day.

Gross Receipts

Gross receipts include all receipts from the provision of food

If you're required to report for more than one establishment,

or beverages (other than nonallocable receipts, see definition

you must complete and file Form 8027-T, Transmittal of

below) from cash sales, charge receipts, charges to a hotel

Employer's Annual Information Return of Tip Income and

room (excluding tips charged to the hotel room if your

Allocated Tips, with Forms 8027. Attach Forms 8027 in

accounting procedures allow these tips to be separated), and

establishment number order (lowest to highest). For more

the retail value of complimentary food or beverages served to

information on establishment numbers, see Establishment

customers as explained below.

Number, later.

New business. You're a new business if you opened a food

Also include charged tips in gross receipts, but only to the

or beverage operation during the year and you didn't operate

extent that you reduced your cash sales by the amount of

any food or beverage operations during the preceding

any cash you paid to tipped employees for any charged tips

calendar year. File Form 8027 for a new food or beverage

due them. However, if you didn't reduce cash sales for

operation if, during any 2 consecutive calendar months, the

charged tips paid out to employees, don't include those

average number of hours worked each business day by all

charged tips in gross receipts. Don't include state or local

employees is more than 80 hours. To figure the average

taxes in gross receipts.

number of employee hours worked each business day during

Remind all directly and indirectly tipped employees

a month, divide the total hours all employees worked during

to include all charged tips and all cash tips received

the month by the number of days the operation was open for

TIP

in the tip amount that they must report to you.

business. After the test is met for 2 consecutive months, you

must file a return covering the rest of the year, beginning with

Nonallocable receipts. These are receipts for carryout

the next payroll period.

sales and receipts with a service charge added of 10% or

When To File

more. Nonallocable receipts generally include all sales on

which tipping isn't customary.

File Form 8027 (and Form 8027-T when filing more than one

Complimentary items. Food or beverages served to

Form 8027) by February 28, 2017. However, if you file

customers without charge must be included in gross receipts

electronically, the due date is March 31, 2017.

if (a) tipping for providing them is customary at the

Extension of time to file. Filers of Form 8027 submitted on

establishment, and (b) they are provided in connection with

paper or electronically may request an extension of time to

an activity that is engaged in for profit and whose receipts

file on Form 8809. File Form 8809 as soon as you know an

wouldn't be included in the amount on line 5 of Form 8027.

extension of time to file is necessary, but not before January

For example, you would have to include in gross receipts

1 of the filing year, and not later than February 28, 2017

the retail value of the complimentary drinks served to

(March 31, 2017, if you file Forms 8027 electronically).

customers in a gambling casino because tipping is

Where To File

customary, the gambling casino is an activity engaged in for

profit, and the gambling receipts of the casino aren't included

Mail Form 8027 to:

in the amount on line 5.

Department of the Treasury

However, you wouldn't have to include the retail value of

Internal Revenue Service

complimentary hors d'oeuvres at your bar or a complimentary

Cincinnati, OH 45999

dessert served to a regular patron of your restaurant in gross

-2-

Instructions for Form 8027 (2016)

Instructions For Form 8027 - 2016 Page 2

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