Tip Compliance Programs Widened


TAX NEWS

The IRS expanded its voluntary tip compliance programs from the food and beverage, gaming and hairstyling industries to all those in which tipping is customary (announcements 2000-19 and 2000-23; notice 2000-21). In exchange for an employer’s or employee’s participation, the IRS agrees to refrain from tip examination.

Employers may participate in either the Tip Rate Determination Agreement (TRDA) or the Tip Reporting Alternative Commitment (TRAC). Under a TRDA, the IRS and the employer determine the amount of tips that employees receive and the amount they should report to the IRS. Under a TRAC, the employer agrees to educate employees about tip income requirements and to establish tip reporting procedures.

SPONSORED REPORT

Get your clients ready for tax season

Upon its enactment in March, the American Rescue Plan Act (ARPA) introduced many new tax changes, some of which retroactively affected 2020 returns. Making the right moves now can help you mitigate any surprises heading into 2022.

100th ANNIVERSARY

Black CPA Centennial, 1921–2021

With 2021 marking the 100th anniversary of the first Black licensed CPA in the United States, a yearlong campaign kicked off to recognize the nation’s Black CPAs and encourage greater progress in diversity, inclusion, and equity in the CPA profession.