Money in a tip jar in a Taos, New Mexico, coffee shop includes a two dollar bill. (Photo by Robert Alexander/Getty Images)
The Internal Revenue Service (IRS) is seeking public comment on a proposed tip reporting program between the tax agency and employers in service industries.
On Monday, the agency issued a notice that contains a proposed procedure to establish the Service Industry Tip Compliance Agreement (SITCA) program. The program would be voluntary and 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," the agency said.
FORMER ALL-PRO RECEIVER LEAVES $1,000 TIP IN TENNESSEE IHOP
The SITCA would replace other reporting programs, the IRS said.
The monitoring of employer compliance will be based on annual tip revenue and charge tip data from an employer’s point-of-sale system.
Participating employers would have to submit an annual report after the close of the calendar year, which reduces the need for compliance reviews by the IRS.
In this photo illustration, the homepage of the Internal Revenue Service (IRS) website seen on a computer screen through a magnifying glass. (Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images)
Those who want to provide feedback and public comment on the matter must do so by May 7.
Many service industry workers, like those in restaurants, rely on tips to supplement their hourly pay, which is usually below minimum wage.
The IRS previously proposed new rules on reporting payments over $600 received via Venmo and PayPal, but has since delayed implementation.
LINK: Get updates and more on this story at foxbusiness.com.