IRS Draft FICA Tip Credit Form Reflects 2025 Law Change

The Internal Revenue Service released a draft version of the 2025 Form 8846, Credit for Employer Social Security and Medicare Taxes Paid on Certain Employee Tips, on Oct. 6, incorporating a provision of the One Big Beautiful Bill Act in the process.

Employers use Form 8846 to claim the Federal Insurance Contributions Act tip credit, which reduces an employer’s taxable business income by the amount of an employer’s share of FICA taxes on employee tips.

The FICA tip credit has historically been available only for food and beverage employers with tipped employees, but the One Big Beautiful Bill Act expanded ...