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Run the Payroll Fee Auditor →Blog · Payroll Management · Restaurant
Restaurants & Hospitality: Payroll Recordkeeping Requirements (2026)
Payroll recordkeeping for restaurants starts at the federal baseline, three years for payroll records and two for the time records behind them, then adds what reaches this industry: IRS Instructions for Form 8027 (2025) and DOL Fact Sheet #15. BEG runs restaurant payroll for $45 per employee per month inside the payroll software you already use, all-inclusive, live in 3 to 5 business days.
Records specific to restaurants
Form 8027 for calendar year 2025 is due March 2, 2026 on paper or March 31, 2026 if filed electronically, and records supporting the return and any tip allocations must be kept for 3 years after the due date.
An employer taking a tip credit must keep records of each employee whose wage includes tips, the weekly or monthly tip amounts reported by the employee, the amount claimed as tip credit, and hours and straight-time pay in both tipped and non-tipped occupations.
The federal baseline every employer keeps
29 CFR 516 requires payroll records for three years and the records they were computed from, time cards, schedules and piece or commission records, for two years. Employment tax records stay four years after the return they support. Forms I-9 stay three years from hire or one year from separation, whichever is later. For restaurants the practical rule is that the pay codes for tip credit and tip pooling and high turnover produce records of their own, and an audit reads those, not the summary.
The rules behind this page, with sources
General information, not legal advice. Every rule below was read on the agency page linked next to it.
- Form 8027 for calendar year 2025 is due March 2, 2026 on paper or March 31, 2026 if filed electronically, and records supporting the return and any tip allocations must be kept for 3 years after the due date. [IRS Instructions for Form 8027 (2025)]
- An employer taking a tip credit must keep records of each employee whose wage includes tips, the weekly or monthly tip amounts reported by the employee, the amount claimed as tip credit, and hours and straight-time pay in both tipped and non-tipped occupations. [DOL Fact Sheet #15]
Read the full guide to how to prepare for a payroll audit, and the rest of the restaurant payroll library.
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Frequently Asked Questions
Restaurant records: IRS Instructions for Form 8027 (2025)
Form 8027 for calendar year 2025 is due March 2, 2026 on paper or March 31, 2026 if filed electronically, and records supporting the return and any tip allocations must be kept for 3 years after the due date.
Restaurant records: DOL Fact Sheet #15
An employer taking a tip credit must keep records of each employee whose wage includes tips, the weekly or monthly tip amounts reported by the employee, the amount claimed as tip credit, and hours and straight-time pay in both tipped and non-tipped occupations.
How long does a restaurant keep payroll records?
Three years for payroll records and two for supporting time records under the FLSA, four years for employment tax records under the IRS rule, and longer where an industry rule cited above says so.
What does managed payroll cost for a restaurant?
$45 per employee per month, all-inclusive, inside the payroll software you already use, with no monthly minimum. Tip credit and tip pooling, high turnover and multiple pay rates are configured at setup, not billed as add-ons.
Related Resources
Anthony leads payroll solutions at Business Executive Group, a national managed payroll firm serving businesses across industries including Restaurants & Hospitality. BEG manages payroll at $45 PEPM, all-inclusive, with deep expertise in compliance, multi-state filing, and industry-specific payroll requirements. Get instant pricing at beghr.com.
Authoritative source: U.S. Department of Labor: Wage and Hour Division
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