The Restaurant Owner’s Hidden FICA Tip Credit

The Challenge: A small restaurant owner was getting crushed by payroll taxes. They were entirely unaware of the specialized tax credits available to the food and beverage industry. The Moorhead Financials Solution: * We audited their payroll records and identified that they qualified for the Section 45B Credit (the FICA tip credit).

  • We applied this credit, which reimburses employers for the Social Security and Medicare taxes they pay on their employees’ tip income. The Result: This advanced business tax strategy resulted in a massive reduction in corporate liability and an $49,000 IRS tax refund on an amended business return.

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