Feature Request: Allow employee to be paid $0 and that employee's tips to be recorded on W-2

[KalebCIvil]

The title of this post has been edited from the original: Net negative pay for tipped emplyees

If an employees cash tip tax liability is too large to be covered by the amount of wages earned in a payroll period an error occurs for net negative pay.  Please fix to allow the employee to be paid $0 and that employee's tips to be recorded on their W-2 so they may pay the owed tax when filing that years tax return.

[#2]

Hi @Eltoroloco

I was able to check in with our Payroll team and they got back to me with the following that addresses what you're seeing: 

The cash tips you’ve included in your payroll run are causing an error because there aren’t enough wages from which the employee’s taxes can be withheld. You’ll see an error if the funds deposited aren't enough to cover the taxes.

With the Cash Tips column, no funds are actually deposited into your employee’s bank account – the amount you report is used to calculate and withhold taxes from the employee’s total pay. If the taxes for these cash tips exceed the amount of gross pay, you’ll receive an error. We're not able to debit or collect additional funds from the employee for the tax due.

To avoid this issue in the future, you may want to enter the employee’s tips as Paycheck Tips. The amount entered in this field will be taxed accordingly and included in your employees’ paychecks.

[KalebCIvil]

No resolution as of yet. Square keeps passing the buck and won't acknowledge that its a flaw on their end. 

[wildheartbrew]

This is quite honestly the most frustrating issue Square has. Please allow us to offset the negative amount with employee taxes. This is the fix. Not that difficult.