#restaurant
Accounting solutions for restaurants and food businesses
For wages paid on or after January 1, 2026, employers must report qualified tips in W-2 Box 12 Code TP and the Treasury Tipped Occupation Code in Box 14b, or tipped employees lose a deduction of up to $25,000 under section 224.
Under IRC Section 197, a liquor license is an intangible you must capitalize and amortize straight-line over 180 months starting the later of acquisition or opening month — no bonus depreciation, no shorter life, no half-month convention. Routine annual renewal fees paid to the state to maintain a license you already hold are generally deductible in the year paid. This guide covers what belongs in basis, the journal entries, Form 8594 allocation when you buy a bar, and five bookkeeping mistakes that misstate hospitality books.
The FDA's Food Traceability Rule (FSMA 204) requires covered businesses to produce lot-level records in a sortable electronic spreadsheet within 24 hours and retain them for two years. The compliance date moved from January 20, 2026 to a proposed July 20, 2028 — here is what CTEs, KDEs, and traceability lot codes require, which 15 commodity categories are covered, and how to build the records now.
A mandatory service charge fails the IRS four-factor tip test, so it is wages rather than tip income — you owe both FICA shares on it, lose the Section 45B credit on Form 8846, and it is excluded from the new OBBBA qualified-tip deduction. Covers the four-factor test, the journal entries that keep Service Charge Revenue separate from Tips Payable, and the payroll, tip-credit, sales tax, and fee-disclosure changes a restaurant hits the day it switches.
Chicago City Council failed to override Mayor Johnson's veto — the tipped wage phase-out to full $16.60 minimum by July 1 2028 continues. Payroll and menu math for operators.
Florida's new service charge transparency law will require restaurants to clearly disclose any automatic gratuity or service charge — amount, label, and who keeps it — before guests order and on the receipt. Learn what to disclose, how to fix your POS and payroll, and how to book service charges correctly.
Square, Toast, and Clover each target a different business — Square starts free at 2.6% + 15¢, Toast locks restaurants into 2-year contracts, and Clover's hardware runs $500–$1,799+. This guide compares real costs by transaction volume and explains the three-way reconciliation problem POS data creates in your books.
Restaurant no-shows cost the U.S. industry roughly $16 billion a year, and the deposits that fight them create a bookkeeping trap — under ASC 606 a reservation deposit is a liability, not revenue, until the guest dines or forfeits. Here's how to record deposits as deferred revenue, book no-show forfeitures as breakage, and reconcile net payouts from OpenTable, Resy, and Tock.
Restaurant labor costs now average over 36% of sales industry-wide, up from the old 30% rule of thumb. A practical guide to tracking labor cost and prime cost weekly — including a 35-hour overtime alert threshold, demand-driven scheduling that cuts labor cost 20–30%, and the chart-of-accounts setup that makes it all measurable.
In June 2026, the DOJ and 17 states settled with Cal-Maine, Versova, and Hickman's for $3.3 million over alleged manipulation of the Urner Barry egg price index from 2022 to 2025 — a period when the three producers earned an estimated $1.22 billion. Here's what bakeries, diners, and grocers should do now, from pulling 2022–2025 purchase records to checking contracts for index-linked pricing clauses.
The FDA moved the FSMA 204 Food Traceability Rule compliance date 30 months, from January 20, 2026 to July 20, 2028, and Congress barred earlier enforcement. The rule itself is unchanged — FTL foods, seven Critical Tracking Events, Key Data Elements, and 24-hour sortable records — so here's who's exempt and how small food businesses can build a compliant traceability plan without enterprise software.
A Phoenix operator that bought 93 fast-food restaurants in 2023 filed Chapter 11 in July 2026, disputing a $7.04 million seller note over allegedly undisclosed liabilities. The case shows why setoff clauses, escrow holdbacks, facilities diligence, and seller solvency checks matter in any seller-financed business purchase.
