The AICPA asked the IRS and Treasury to provide guidance on the reporting and substantiation requirements for deductions of qualified tips and overtime pay allowed under the One Big Beautiful Bill Act.
In a letter dated Friday, the AICPA said that neither Form W-2, Wage and Tax Statement, nor Form 1099-NEC, Nonemployee Compensation, provides designated fields to report the amount of qualified tips and qualified overtime compensation or the occupation codes that the IRS established for use in years beyond 2025.
This leaves employers and payers uncertain about how to meet the required information-reporting standards for the deductions, said Scott Klein, CPA, senior manager–Tax Policy & Advocacy for the AICPA.
“Additionally, tax return preparers and individuals preparing their own tax returns are unsure which type of alternative documentation they can rely on to support the deductions for qualified tips and qualified overtime compensation,” Klein said. See the AICPA’s recommendations.