The IRS says SITCA is designed to take advantage of advancements in point-of-sale, time and attendance systems, and electronic payment settlement methods to improve tip reporting compliance. 

Comment is being sought through May 3.

The features of SITCA, which could replace three existing programs, include the following:

* Monitoring employer compliance based on actual annual tip revenue and charge tip data from an employer’s point-of-sale system, and allowance for adjustments in tipping practices from year to year.                                                                                                                                                                                                                                                                                                                   * Employers demonstrate compliance with requirements by submitting an annual report after the close of the calendar year.                                                                                                                    * Protection for employers rom liability under rules defining tips as part of an employee’s pay for calendar years in which they remain compliant with program requirements.                              *Flexibility for employers to implement employee tip reporting policies best suited for employees and their business model 

SITCA would replace the Tip Rate Determination Agreement, Tip Reporting Alternative Commitment and Employer designed TRAC. It does not affect the Gaming Industry Tip Compliance Agreement program and IRS said it is exploring “opportunities within the gaming industry.”

If SITCA is adopted, the existing programs will remain in effect until the earlier of the employer’s acceptance into the SITCA program; an IRS determination that the employer is noncompliant with the terms of their TRDA, TRAC or EmTRAC agreement; or the end of the first full calendar year after the final revenue procedure is published in the Internal Revenue Bulletin.