FICA Tip Credit Calculator (IRS §45B)

A federal tax credit (IRS §45B) that lets food and beverage employers recover a portion of the Social Security and Medicare taxes they paid on employee-reported tips. It is a dollar-for-dollar credit — meaning every dollar of credit directly reduces your federal tax bill.

Businesses where tipping is customary: restaurants, bars, hotels, casinos, catering companies, food trucks, breweries, wineries, and similar hospitality employers. The credit applies to tips on food and beverage service.

Typically about 7.65% of creditable tips per year. Use the calculator above to estimate your savings based on your actual server count, wages, and tip percentages.

Tips are only creditable above the amount needed to bring an employee up to the federal minimum wage basis for §45B purposes ($5.15/hr). Tips that simply make up the difference to that threshold are excluded from the credit. This is why the calculator includes cash wage and minimum wage basis inputs.

No. You do not change wages or tip practices to qualify for the credit. The credit is based on tips employees already reported — you are simply recovering FICA taxes you already paid.

You can amend returns and claim refunds for up to 3 prior tax years. That is why the calculator shows a 3-year total — it represents the potential recovery if you have not claimed this credit before.

Many businesses see refunds or credits processed in approximately 16–20 weeks, depending on IRS processing times. The amended return process can vary.

Yes. We coordinate with CPA partners end-to-end — paperwork, calculations, and filings. Schedule a free 15-minute consultation or start your claim directly through our partner portal.