Hello RonDecantWinery,
There are a couple of ways on how to record paycheck tips. One of them is by creating a deposit then creating a journal entry. To make sure where on the same page, I'll share the steps how to offset the tip amount from the Undistributed Tips account.
Step 1: Record the collected tips:
- Click on the Plus icon and choose Receive Payment.
- Choose the customer name.
- Select Undeposited Funds as the Deposit to account.
- Click on Save and close.
Step 2: Create a journal entry:
- Click on the Plus icon and choose Journal Entry.
- In the first line item, choose Undistributed Tips and put the amount out to the employees in the Debits column.
- In the second line item, choose Undeposited Funds and put the same amount in the Credits column.
- Click on Save and close.
Step 3: Record the deposit:
- Click on the Plus icon and choose Bank Deposit.
- Select the original payment and the journal entry; this will reduce the total by the amount of the tips you paid out.
- Click on Save and close.
I've got you an article for more options: How to Record a Tip and Add Tips on the Employee Paycheck.
We'll be glad to see you coming back for more questions.