Configure for Tip Income - Overview

Configuring Avionté to Accommodate Tip Income

This article will walk you through the setup of transaction types to handle tip income. 

Contents

• Overview
  • Understanding Tip Types
• Creating New Tip Transaction Types
• Editing an Existing Tip Transaction Type
• Important Notes

Overview

Transaction types are used to track various types of payroll transactions, including tips. This guide explains how to create and configure tip transaction types in your system.

Understanding Tip Types

Cash Tips are the tips an employee receives in cash. Cash Tips are included in Gross Wages for taxes but are not included in the Net Pay (Cash).

Credit Card Tips are the tips that are added into a credit card charge that need to be paid to the employee. Credit Card Tips are included in Gross Wages for taxes and are included in the Net Pay (Cash).

Creating a New Tip Transaction Type

1. Login to Classic and from the Start Page, click Actions, and from the drop-down menu that will open, select Admin Tools.
2. On the right-hand side of the Admin Tool Main pop up, scroll down, and click on Transaction Types.
3. Click the Add New button and the Transaction Type Details section below will refresh, allowing you to enter the details of the transaction type.
4. Configure the basic information within this section.
   • Name: Enter a descriptive name for the transaction type (e.g., "Cash Tips" or "Credit Card Tips")
   • Description: Enter a description that explains the purpose of this transaction type
5. Configure tip-specific information within this section. Select the appropriate checkbox based on the type of tips you're configuring:
   • For Cash Tips:
     • Check the Is Cash Tips checkbox
     • In the Vertex Pay Code dropdown, select Reported Tips
   • For Credit Card Tips:
     • Check the Is Credit Card Tips checkbox
     • In the Vertex Pay Code dropdown, select Reported Tips
6. Configure W-2 reporting within this section.
   • W2Box: Enter 7
   • This ensures tips are properly reported in Box 7 (Social security tips) of the W-2 form
7. Save the configuration by clicking Save in the lower right.
8. The new transaction type will now be available for use in payroll processing

Editing an Existing Tip Transaction Type

1. Login to Classic and from the Start Page, click Actions, and from the drop-down menu that will open, select Admin Tools.
2. On the right-hand side of the Admin Tool Main pop up, scroll down, and click on Transaction Types.
3. Modify any of the fields as needed (Name, Description, checkboxes, Vertex Pay Code, W2Box, etc.)
   • Ensure the appropriate tip type checkbox remains selected (Is Cash Tips or Is Credit Card Tips)
4. Once all changes are made, click Save to update the transaction type.
   • The changes will take effect immediately.

Important Notes

• Only select one tip type checkbox (either Cash Tips or Credit Card Tips)
• The Vertex Pay Code selection affects how tips are reported for tax purposes
• Box 7 on the W-2 form is used to report Social Security tips to employees and the IRS
• Be cautious when editing transaction types that are already in use, as changes may affect historical reporting