Vice President Kamala Harris — who on Saturday copied a campaign promise first announced by former President Donald Trump to eliminate taxes on tips — voted in 2022 to pass legislation that allowed the IRS to track down workers’ tips so that they could be taxed.
On August 7, 2022, Harris cast the tie-breaking vote to pass the Inflation Reduction Act that provided $80 billion in additional funding to the Internal Revenue Service (IRS), which then got to work cracking down on the service industry’s reporting of tips so that they could be taxed.
President Joe Biden’s White House also boasted that the Inflation Reduction Act “provided $80 billion in additional funding to the IRS.”
In February 2023, the IRS released a proposed revenue procedure known as the Service Industry Tip Compliance Agreement (SITCA) program.
The agency described SITCA as “a voluntary tip reporting program between the IRS and employers in various service industries” that would include “monitoring of 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.”