Employer's Annual Information Return of Tip Income in San Antonio, Texas (2026)
If you don't file this annual report, the IRS can impose penalties for each failure, your employees' reported income won't match agency records, and you risk a payroll tax audit. You are responsible for filing the Employer's Annual Information Return of Tip Income, also known as Form 8027, with the Internal Revenue Service (IRS) for your San Antonio restaurant.
Key details:
- 48 fields — ApronPrep auto-fills 40
- $0–$0 government filing fees
- Varies processing time, but the form is due annually
Most applicants complete this in under 15 minutes with ApronPrep, which auto-fills 40 of 48 fields.
Analyzed from Employer's Annual Information Return of Tip Income
83% from one compliance interview
Manual entry or document upload required
Why You Need a Employer's Annual Information Return of Tip Income
You must file the Employer's Annual Information Return of Tip Income (Form 8027) because federal law mandates it, specifically the Internal Revenue Code (Title 26), Section 6053(c). This requirement is enforced by the Internal Revenue Service (IRS), not a local San Antonio or Texas authority. The law requires food and beverage establishments where tipping is customary to report allocated tip income if their employees report tips totaling less than 8% of gross receipts. This ensures all tip income is properly accounted for for Social Security and Medicare tax purposes.
Failing to file or filing incorrectly triggers significant federal penalties that compound quickly:
- Failure-to-file penalty: 5% of the unpaid tax for each month the return is late, up to a maximum of 25%.
- Failure-to-pay penalty: 0.5% of the unpaid tax for each month it remains unpaid, on top of the failure-to-file penalty.
- Interest charges: The IRS charges interest on any unpaid tax and penalties from the original due date.
- Operational and legal risk: While not a local cease-and-desist, persistent non-compliance can trigger an IRS audit, leading to assessments for past years, employee reclassification issues, and potential criminal prosecution for willful fraud or evasion.
Legal code: Internal Revenue Code (Title 26)
Recent update: For the 2026 tax year, the IRS requires Form 8027 to be filed electronically by February 28, 2027, if you are filing 10 or more information returns, continuing the push for digital submission.
Who Needs a Employer's Annual Information Return of Tip Income?
| Type | Required | Notes |
|---|---|---|
| Restaurant (Full-Service) | Required | Federal law (IRC §6053) requires employers with tipped employees to file Form 8027; this mandate supersedes any local variation, making it a universal federal requirement. |
| Bar / Nightclub | Required | Tipped bartenders and servers trigger the federal filing requirement under IRC §6053, as these establishments meet the "large food or beverage establishment" criteria when certain conditions are met. |
| Food Truck | Not Required | Unless the food truck employs tipped staff who regularly report more than $20 per month in tips, it does not meet the threshold for a "large food or beverage establishment" and is exempt from filing Form 8027. |
| Coffee Shop / Café | Not Required | Typically operates with counter service and a tip jar; without formally assigned tipped employees and the required scale of operations, it is exempt from the Form 8027 filing requirement per IRS guidelines. |
See which restaurant types need this requirement — and which don't.
See Full Requirements →Field-by-Field Guide (48 Fields)
40 of 48 auto-filledAmended Return
checkboxCheck this box only if you are correcting a previously filed Form 8027, such as for a math error or omitted information; leave it unchecked for your initial or regular annual filing.
COMMON MISTAKE: Incorrectly checking this box for a first-time or routine annual filing, which can cause the IRS to flag the return for review and delay processing.
Final Return
checkboxCheck this box only if your establishment permanently closed during the tax year reported; this indicates you will not file Form 8027 for this business in the future.
COMMON MISTAKE: Checking this box for a temporary seasonal closure or because you missed a prior year's filing, which incorrectly signals a business termination to the IRS.
Type: Alcoholic Beverages
checkboxCheck this box if your establishment's primary business is serving alcoholic beverages for consumption on-premises, such as a bar or tavern where food service is incidental.
COMMON MISTAKE: Selecting multiple establishment type checkboxes, as the IRS requires you to choose only the single category that best describes your primary business activity.
Type: Meals Other Than Evening
checkboxCheck this box if your establishment primarily serves meals during breakfast, brunch, or lunch hours, with the majority of food receipts from non-evening service.
Type: Evening and Other Meals
checkboxCheck this box if your establishment serves a significant mix of both evening meals (dinner) and meals at other times, with no single period generating the vast majority of food receipts.
Type: Evening Meals Only
checkboxCheck this box if your establishment's primary food service is during evening/dinner hours, such as a fine-dining restaurant that operates only for dinner service.
Accepts Credit Cards: Yes
checkboxCheck this box if your establishment accepted any credit or debit card payments for food or beverage sales during the reporting year, as this affects tip allocation calculations.
COMMON MISTAKE: Checking both 'Yes' and 'No'; you must select only one, and selecting 'No' when you do accept cards is a common data-matching error flagged by the IRS.
Accepts Credit Cards: No
checkboxCheck this box only if your establishment operated on a cash-only basis for the entire reporting year, with no credit or debit card transactions for food or drinks.
Line 7c: Allocation Method - Good Faith Agreement
checkboxCheck this box if you used a written, IRS-approved tip allocation agreement between employer and employees to report allocated tips, instead of the gross receipts method.
COMMON MISTAKE: Selecting a method not supported by your records; the 'Good Faith Agreement' method requires a specific, pre-existing written agreement, and misuse can trigger an audit.
Line 7b: Allocation Method - Gross Receipts
checkboxCheck this box if you used the standard IRS gross receipts method to calculate allocated tips, which is based on a formula of charged tips versus gross receipts.
COMMON MISTAKE: Incorrectly checking both allocation method boxes; you must select only one, and the Gross Receipts method is the default for most establishments without a formal agreement.
ApronPrep auto-fills 40 of 48 fields from a single compliance interview — no re-typing, no guessing what the government expects.
Top 5 Employer's Annual Information Return of Tip Income Mistakes
1. Missing the Required Employee Form 4070
Failing to ensure each employee has a completed IRS Form 4070, 'Employee's Report of Tips to Employer,' on file before reporting. The IRS requires this form as the primary record of reported tips. Without it, your Form 8027 submission lacks substantiation, which can trigger an audit or lead to the IRS adjusting your payroll tax liability.
2. Reporting Tips for Non-Covered Employees
Including tips for employees in roles not involved in customary tip-sharing, such as dishwashers, chefs, or managers. The IRS specifically requires reporting only for 'food or beverage employees' who customarily receive tips. Including others can distort your establishment's tip rate and raise red flags during review.
3. Inaccurate Allocation of Gross Receipts
Entering incorrect figures for total gross receipts or failing to properly segregate non-food/beverage sales (like merchandise). The form requires the gross receipts amount from food and beverage sales only where tipping is customary. Including non-applicable sales inflates the baseline and will cause the calculated tip rate to be inaccurate, potentially signaling under-reporting.
Skip the Paperwork on Your Employer's Annual Information Return of Tip Income
ApronPrep auto-fills 40 of 48 fields from one compliance interview.
No credit card required
Employer's Annual Information Return of Tip Income by City in Texas
| City | Fee Range | Timeline |
|---|---|---|
| Dallas | ||
| Houston | ||
| San Antonio |
Timeline: 4–6 Weeks for the Annual Cycle
Gather Employee Tip Data for the Tax Year
Collect Form 4070A (Employee's Daily Record of Tips) or equivalent records from each tipped employee for the entire calendar year. The IRS requires you to verify that total reported tips equal at least 8% of your establishment's gross food and beverage sales. Have your annual sales reports and payroll records (including allocated tip amounts from Form 8027) ready for reconciliation. The most common delay is incomplete or mismatched tip data between employee reports and your payroll system.
Complete IRS Form 8027
Fill out the Employer's Annual Information Return of Tip Income (Form 8027) using the aggregated data. This form has 21 fields where you'll enter establishment information, gross receipts, charged tips, and reported tips. You must also complete Form 8027-T (Transmittal of Employer's Annual Information Return of Tip Income) to submit it. Use the IRS's EFTPS system to make any required payments for Social Security and Medicare taxes on allocated tips. Errors in calculating the 8% threshold or transposing numbers from payroll ledgers are a top cause for IRS notices.
File with the IRS by February 28
Submit the signed Form 8027 and Form 8027-T to the IRS by the statutory deadline (February 28 of the year following the reported tax year, or March 31 if filing electronically). While there is no specific filing with the City of San Antonio for this form, you must maintain a copy for your records and for potential Texas Alcoholic Beverage Commission (TABC) audits, as tip reporting can impact payroll compliance. Electronic filing via the IRS FIRE System is required if you have 250 or more information returns.
Other Requirements You'll Need
This is one of 13 requirements for opening a restaurant in Texas.
ADA Compliance Self-Certification
federal
Alarm System Permit/Registration
local
Alcoholic Beverage License Posting/Display Requirement
state
Application for Employer Identification Number
federal
See all co-required forms and how they connect to your compliance dossier.
See All RequirementsProcessing time varies based on your specific situation, such as whether you file electronically or on paper, and whether the IRS needs to verify the information submitted. The IRS generally processes electronic filings faster. It is not a document that is 'issued' or physically sent to you like a permit; the timeline refers to the IRS processing your information return.
There are no government filing fees for submitting IRS Form 8027, the Employer's Annual Information Return of Tip Income. However, failure to file this form can result in significant penalties, which should be considered as the real cost of non-compliance. Not legal advice — verify with the IRS.
No. The Employer's Annual Information Return of Tip Income (Form 8027) is a federal tax filing specific to the Employer Identification Number (EIN) associated with your business and its operational data for a given tax year. If you move locations, you must continue to file annually using your EIN; any significant operational change may also necessitate updating your Application for Employer Identification Number details with the IRS.
You must file it annually, for each calendar year your business has employees who receive tips. It is not a 'renewable' permit but a mandatory yearly filing, similar to other payroll tax obligations. Missing the annual deadline (typically the last day of February) triggers penalties.
There is no physical inspection for this form. The "review" is an IRS audit of your reported tip income and allocated tips against your payroll records and other filings, such as your employees' W-2 forms. Ensuring your EFTPS Enrollment for tax payments is correct and that your records match across all documents is critical to passing this compliance check.
About This Data
This guide is generated from ApronPrep's compliance dossier system, which uses 53 parallel AI authority experts to discover requirements, then downloads actual forms and generates field-level intelligence for each one.
For Texas specifically, we have analyzed compliance dossiers for 3 cities (Dallas, Houston, San Antonio), generating Rich FILs (Form Intelligence Layers) with 48 form fields analyzed for this requirement. Fee data is sourced from actual county department fee schedules, not estimates.
Our data is verified against official government sources and updated when regulatory changes are detected. If you find an error, please report it — accuracy is our core commitment.
Sources
- Internal Revenue Code (Title 26)
This Form Is One of 60+ Requirements.
ApronPrep discovers every permit your city requires — including the ones generic checklists miss. Pick your city for the complete package.