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ITG FAQ #9 Answer-What are the differences between a TRDA and a GITCA?

The differences are shown in the chart. For more information or to initiate a tip agreement, you should contact your ITG specialist.

Tip Rate Determination Agreement (TRDA)

Gaming Industry Tip Compliance Agreement (GITCA)

Term of Agreement  As stated in agreement 3 years or less.  May be renewed for additional terms of three years
Effective Date First day of the next calendar quarter following signature by both parties

On date agreed within the body of the GITCA

Reopening of Rates

On application by casino by 9/30 of each year

Mutual agreement of both parties at any time during the term of the agreement 

Threshold to Maintain Agreement

75% of eligible employees must participate to guarantee TRDA maintained 

50% of eligible employees must participate to guarantee GITCA maintained

Employer

IRC 3121(q) Relief

During the period the TRDA is in effect no 3121(q) assessment against the employer except for employee tips reported on Forms 4137 and 885-T

For any taxable year the GITCA is in effect no 3121(q) assessment on tip income of the employees except for audit results on nonparticipating employees and employee tip income reported on Form 4137
Form 8027 Filing Required for all food and beverage operations and employees

Not required for food and beverage operations and employees if records are given to the Service that includes all relevant data

Shift/Hour/Occupational Category Reporting Requirements 

Required annually on non-participating tipped employees

Annual reporting required on all tipped employees
Tip Rate Calculation/Methodology By occupation and shift

By occupation and shift - housekeeping occupations cannot be included

Tip Audits of Participating Employees  No guarantee of retroactive relief

No retroactive audit unless the employee declined prior participation in a TRDA or GITCA

Termination of Agreement 

At any time by the casino,

or

By IRS if less than 75% participation at the end of a calendar year, failure to comply with agreement terms, or where an enforcement proceeding exists

By joint agreement of both parties,

or

By IRS if participation is less than 50%, the employer fails to attempt to raise participation to 75%, or the employer fails to comply with any material provision of the agreement

 

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Page Last Reviewed or Updated: 15-Aug-2014