SECTION 13. EFFECT OF

THIS REVENUE PROCEDURE ON OTHER TIP REPORTING PROGRAMS

1. Effect on TRAC, TRDA, and Em- TRAC programs . This revenue proce

dure terminates the TRAC and TRDA programs by superseding Announcement 2001-1. This revenue procedure also terminates the EmTRAC program by superseding Notice 2001-1, which set forth the requirements for employers in the food and beverage industry to participate in the EmTRAC program.

.02 Transition period for employers with existing agreements. For employers with existing agreements in the TRAC, TRDA, and EmTRAC programs, there will be a transition period during which the existing agreements will remain in effect after the publication of this revenue procedure terminating those programs. The transition period is the period from the date of the publication of the final revenue procedure in the Internal Revenue Bulletin until the earliest of (1) the employer’s acceptance into the SITCA program, (2) an IRS determination that the employer is noncompliant with the terms of the TRAC, TRDA, or EmTRAC agreement, or (3) the end of the first calendar year beginning after the date of the publication of the final revenue procedure in the Internal Revenue Bulletin. An employer’s existing agreement in the TRAC, TRDA, or EmTRAC program is terminated for all periods after the end of its transition period.

.03 Continued employer protection for years covered by agreement . After the transition period described in section 13.02 has ended and an existing TRAC, TRDA, or EmTRAC agreement has terminated, employers with existing TRAC, TRDA, and EmTRAC agreements who are compliant with the terms of their agreements will continue to have protection from section 3121(q) liability for all prior return periods covered by their agreement (including during the transition period described in section 13.02 of this revenue procedure). No employer with an existing TRAC, TRDA, or EmTRAC agreement will have protection from section 3121(q) liability after the conclusion of the transition period described in section 13.02.

.04 Employee protection from tip in- come examination . After the transition period described in section 13.02 has ended and an existing TRAC, TRDA, or EmTRAC agreement has terminated, employees who have been receiving protection from tip income examination through

their employer’s participation in an existing TRAC, TRDA, or EmTRAC agreement will continue to receive that protection for the prior return periods covered by their employer’s agreement (including during the transition period described in section 13.02 of this revenue procedure) to the extent their employers remain compliant with the terms of their agreement. No employee will have protection from tip income examination through their employer’s participation in a TRAC, TRDA, or EmTRAC agreement after the conclusion of the transition period described in section 13.02.