[Copy of Original Document Text 08-04-2005]

Memorandum of Understanding

between

Tax Exempt / Government Entities (TEGE) Office of Indian Tribal Governments

and

Small Business / Self Employed (SB / SE) BSA Program

Purpose of Agreement

This agreement between the TEGE Office of Indian Tribal Governments (ITG) and the SB/SE Office of Fraud/BSA Policy provides guidance for personnel in those functions with regard to identification, notification, education, and examination activities relating to the Bank Secrecy Act (BSA) and IRC section 6050I responsibilities of tribal governments. The purpose of the agreement is to clarify the responsibilities of the Office of Indian Tribal Governments and the Office of Fraud/BSA Policy with respect to the administration of Bank Secrecy Act (BSA) and IRC Section 6050I activities involving tribal governments.

Operating Procedures for Both Operating Functions

1) ITG has responsibility for the identification of entities subject to the Bank Secrecy Act (BSA) and IRC section 6050I that are owned by Indian Tribal Governments. ITG is responsible for notifying the BSA Program staff of any identified entities. The BSA Program staff will provide ITG with the format for reporting this information to them.

2) On a ongoing basis, ITG will provide BSA Workload Identification and Selection staff with any updates to the information on Tribal entities subject to BSA. The BSA Program staff will provide ITG with the format for reporting this information to them. BSA staff will be responsible for updating their Title 31 basis.

3) ITG and BSA Program staff (including BSA TEC management and specialists) will utilize their web site pages to share the names, telephone numbers and geographic areas of the field personnel to be used contact points. ITG information will be accessible at www.irs.gov/tribes under the " About ITG" link. BSA staff information will be accessible at http://sbse.web.irs.gov/FR/ .

4) ITG and the BSA Program staff (including BSA TEC management and specialists) share responsibility for Bank Secrecy Act and IRC section 6050I notification and education activities relating to entities that are owned by Indian Tribal Governments. As soon as an Indian Tribal Government entity subject to the BSA is identified, ITG will issue a Letter 1052 to the entity and will notify the BSA Workload Identification and Selection staff via an e-mail message that includes a copy of the Letter 1052. As soon as an Indian Tribal Government entity subject to the IRC Sec. 6050I is identified, ITG will notify BSA Workload Identification and Selection staff via an e-mail message.

5) After identification, and ITG's issuance of IRS Letter 1052 for BSA entities, ITG will arrange for education of the tribal entity. ITG will notify BSA TEC management, who may arrange for BSA TEC or BSA examination field staff to accompany the ITG representative. All materials and handouts must be approved by BSA Program staff. ITG personnel conducting the educational outreach will prepare a standard report after each educational outreach. A copy of the report will be forwarded to the BSA Workload Identification and Selection staff for inclusion in the historical file. All subsequent educational outreach will follow the same procedures.

6) ITG will coordinate the delivery of Bank Secrecy ACT (BSA) and IRC section 6050I training for all ITG field personnel. BSA Program staff will assist in that process, by reviewing training materials created by ITG to ensure currency, relevancy, and adequacy. ITG staff will be invited to attend BSA basic training and BSA casino training as well as subsequent BSA CPE's and updates. BSA Program staff and ITG staff may be invited to make presentations during each other's relevant training, with each function funding its own costs.

7) ITG will ensure that processes and procedures exist so that there is a separation of Title 26 and Bank Secrecy Act (BSA) activities in interactions between ITG and tribal entities. All Bank Secrecy Act (BSA) contacts will be separate and distinct from contacts on any other matter, and there will be no co-mingling of information.

8) BSA Program staff will have full jurisdiction over the planning and conduct of all Bank Secrecy Act (BSA) and IRC section 6050I compliance examination and reviews involving entities owned by Indian Tribal Governments. On October 1st and April 1st of each fiscal year, ITG will provide the BSA Workload Identification and Selections staff with a data-driven risk analysis of tribal entities, using selection and ranking criteria approved by designated BSA staff. BSA staff will share the relevant portion of their annual Work Plan with ITG, so that ITG can estimate the impact on tribal casinos and can separately determine targeted outreach they may wish to perform on entities that are not likely to be examined

9) BSA Field Managers will notify the applicable ITG Field Manager prior to initiating any Bank Secrecy Act (BSA) or IRC section 6050I examination or review activity with regard to entities owned by Indian Tribal Governments. The ITG Field Manager will assist the applicable BSA staff in addressing proper protocol for contacting and interacting with tribal government officials and representatives. Where both ITG field personnel and the BSA staff agree, an ITG Specialist may assist BSA examiners. The type of assistance may include contacting the appropriate Tribal Representative regarding any pending actions by the BSA staff, and accompanying the BSA examiner conducting the examination.

10) Any Internal Revenue Manual provisions drafted for IRS use, which have relevancy to the Bank Secrecy Act (BSA) or IRC section 6050I, will be approved by the BSA Program staff prior to implementation, to ensure accuracy and consistency with national program requirements. Any BSA materials that reference Indians tribes or tribal entities will be shared with ITG for their input prior to implementation. In case of conflict in IRM material, the BSA IRM will govern.

11) ITG field personnel will refer to the appropriate BSA staff any BSA questions which are complex or which deal with policy matters or which are asked by an entity under examination or review. Routine BSA questions may be answered by ITG personnel.

12) ITG will ensure that all time applied by ITG staff in support of the Bank Secrecy Act and IRC section 6050I activities is properly documented and reported to the BSA program staff under written procedures to be provided by that office.

13) It is expressly understood that the Office of Indian Tribal Governments has jurisdiction over tribally owned entities only. All potential BSA matters relating to individuals on or near Indian lands, or businesses not wholly owned by Tribal governments, remain within the sole jurisdiction of the Director, Fraud/BSA Program. However, BSA Field Managers will notify the applicable ITG Manager in advance of any contact regarding a BSA matter involving a non-tribal entity known to be located on an Indian reservation or tribal lands. ITG will provide input regarding any potential political or security issues. ITG may assist in facilitating resolution of issues upon request of BSA staff.

Terms of this Agreement

This agreement supersedes the prior agreement dated April 2002, and is effective thirty days after signature.

This agreement may be amended at any time to accommodate unanticipated issues with both parties' concurrence.

Dispute Resolution

If the ITG and BSA staff are unable to reach a mutually agreeable solution to any issues concerning Bank Secrecy Act (BSA) or IRC section 6050I activities, the disputed issue will be submitted to the next higher level of management in each function for resolution.

Christie J. Jacobs /s/ 08/04/2005

Director, Office of Indian Tribal Governments

Thomas Ludwig /s/ 07/14/2005

Director, Fraud BSA

Linda Shoemaker for Beth Tucker /s/ 07/6/2005

Director, Communications, Liaison, & Disclosure

I. PARTIES

The parties to this Agreement are XYZ Tribe, DBA: XYZ Casino, 1234 U.S. Hwy. 10, Anywhere, USA 12345. 12-3456789_ (hereinafter Employer) and the Commissioner of the Internal Revenue Service (hereinafter Service; collectively the Parties). This Agreement will establish tip rates for all Participating Employees of the Employer. This Agreement is pursuant to Rev. Proc. 2003-35.

II. APPENDICES

The parties have agreed to:
A. The Occupational Categories, available shifts, and tip rates for all participating employees of the Employer, set forth in Appendix A,
B. A Narrative Summary of Tip Rate Calculation Methodology (specific to the Employer), set forth in Appendix B,
C. The Model Gaming Employee Tip Reporting Agreement, set forth in Appendix C, and
D. The Model Extension Agreement, set forth in Appendix D.

III. INTENDED BENEFICIARIES

The Participating Employees of the Employer are intended beneficiaries of this Agreement.

IV. EMPLOYEE PARTICIPATION

A. For purposes of this Agreement, an Eligible Employee means an individual who:
(1) performs a job function in an Occupational Category described in Appendix A of this Agreement, and;
(2) regularly and routinely receives tips, directly or indirectly, of at least $20 per month during the course of his or her employment.
B. A Participating Employee is an Eligible Employee who:
(1) filed, if required to do so by law, federal income tax returns for the three taxable years that precede the Effective Date of this Agreement or, if he or she has not filed, files these returns prior to signing the Model Gaming Employee Tip Reporting Agreement provided in Appendix C of this Agreement;
(2) gives to the Employer a signed Model Gaming Employee Tip Reporting Agreement;
(3) reports and continues to report his or her tips to the Employer at or above the tip rates set forth in Section VIII. of this Agreement, except as provided by paragraph E of this section; and
(4) timely files federal income tax returns that report those tips.
C. An Eligible Employee who has filed federal income tax returns for the three taxable years that precede the Effective Date of this Agreement but has not fully paid the tax liability reported on such returns, or has additional tax liability due to, for example, a completed examination of such returns or the filing of amended returns, may participate in this program. To participate, however, he or she must contact the local office of the Service within the later of 60 days of electing to become a Participating Employee under this Agreement or 60 days of commencing employment to resolve his or her tax liability.
D. For purposes of this Agreement, a "Nonparticipating Employee" is any Eligible Employee who is not a Participating Employee.
E. A participating Employee may report tips on his or her federal tax return below the tip rates if the employee can substantiate, with adequate books and records, that he or she earned less tip income than would be reflected by applying the tip rates.

V. EMPLOYER PROGRAM

A. The Employer agrees to encourage all of its Eligible Employees to become Participating Employees and to sign the Model Gaming Employee Tip Reporting Agreement, attached as Appendix C. The Employer will keep these agreements for at least the period of limitation on assessment of employment tax for the years in which this Agreement is in effect and the Employer will make the agreements available to the Service upon request.
B. The Employer shall make tax withholding based upon tips reported, as required by law.
C. The Employer shall include all reported tips in I.R.S. Forms W-2.
D. The Employer acknowledges that the Service has authority, including the issuance and enforcement of summonses pursuant to sections 7602, 7604, and 7609 of the Code, to secure the information necessary to the Service to develop the tip rates of Nonparticipating Employees.
E. The Employer shall maintain the following records, to be made available to the Service upon request:
(1) Employee records. For each Eligible Employee, the Employer will maintain a record of the Employee's name and social security number; the date on which the employee was hired by the Employer; the Employee's Occupational Category or Categories, as set forth in Appendix A; the Employee's reported tips; the Employee's shift(s) and/or hours; and the Employee's wages.
(2) Gaming establishment records. For each instance of toke and chip-cashing, where such information is in the possession or control of the Employer, the Employer will maintain a record of the dollar amount of tokes and chips presented to the Employer for cashing by the toke committee (or other representatives of eligible employees); a list of the tip splits furnished to the Employer by its Eligible Employees or the toke committee (or other representatives of eligible employees); and other separate records of the amounts presented to the Employer for cashing by toke committee. The Service acknowledges that the records of the toke committee reflecting the actual division of tips may not be in the Employer's possession or control.
(3) Food and beverage operations records. If the Occupational Categories set forth in Appendix A include food or beverage servers, the Employer will maintain gross receipts subject to food or beverage tipping, and aggregate receipts showing charged tips.
(4) Tip rates records. The Employer will maintain any other records relevant to determining tip rates, as may be required by other governmental agencies.
The employer must retain the records listed in this section for at least 4 years after the April 15 following the calendar year to which the records relate.
F. The Employer shall furnish to the Service the following documents:
(1) An annual report showing each Eligible Employee's name and social security number; the Employee's Occupational Category or Categories; the Employee's shift(s) and hours; the Employee's wages and reported tips; and whether the employee is a Participating Employee. The report is due on or before March 31 for the preceding calendar year or any portion thereof during which the Gaming Industry Tip Compliance Agreement was in effect.
(2) If the Occupational Categories listed in Appendix A include employees of large food and beverage establishments as defined in section 6053(c)(4) of the Code, the Employer shall provide annually to the Service the following information:
a) the gross receipts subject to food and beverage tipping;
b) the aggregate amount of charge receipts attributable to such gross receipts;
c) the aggregate amount of charged tips shown on such charge receipts;
d) the sum of (i) the aggregate amount of tips reported by Nonparticipating Employees to the Employer and (ii) the amount the Employer is required to report under section 6051 of the Code with respect to service charges of less than 10 percent; and
5) the amount allocated to each Nonparticipating Employee under section 6053(c)(3) of the Code. In addition, the Employer shall include on the Forms W-2 issued to Nonparticipating Employee's tips allocated pursuant to section 6053 of the Code. No such tip allocation shall be required on Forms W-2 issued to Participating Employees. Accordingly, no preparation and filing of I.R.S. Forms 8027 by the Employer shall be required with respect to Participating Employees. The information is due on or before the Form 8027 filing date.
G. If the Employer complies with the terms of this Agreement with respect to its Participating Employees and provides the information described in paragraph F of this section to the Service with respect to its Nonparticipating Employees on I.R.S. Forms 8027 (or the equivalent information in an alternate form deemed acceptable by the Service) and I.R.S. Forms W-2, the Employer shall be deemed to satisfy the requirement that the Employer prepare and file I.R.S. Forms 8027 with respect to its Employees.
H. If the Employer fails to maintain or provide any material information in the manner described in paragraphs E and F of this section, following notice and demand to the Employer for such information, the Service may employ any lawful means, including the issuance and enforcement of summonses pursuant to sections 7602, 7604, and 7609 of the Code, in order to secure that information.
I. In the event of a material breach by the Employer of its obligation to maintain or provide the information described in paragraphs E and F of this section that continues following notice and demand for such information by the Service, the restrictions in Section VII.A on methods of determination of additional liabilities under section 3121(q) of the Code shall be deemed to be waived by the Employer and shall be inapplicable for all taxable periods occurring after the date of such material breach, and the Service shall be permitted to determine employer liability by any lawful means.

VI. TIP EXAMINATIONS OF EMPLOYEES

A. No Participating Employee Examinations.
Except as provided in paragraph B. of this section, the Service may not examine a Participating Employee's tip income for any taxable year that ends after the Effective Date of this Agreement to which this Agreement applies, provided that each of the following conditions is met:
(1) The employee is a Participating Employee for the entire taxable year (or such portion thereof during which he or she earns tip income). In the case of a new employee, he or she must become a Participating Employee within 60 days after commencement of employment with the Employer as an Eligible Employee.
(2) The Participating Employee reports the tips he or she earns during the taxable year to the Employer at or above the tip rates set forth in Section VIII. of this Agreement.
(3) The Participating Employee timely files a federal income tax return for the taxable year that reports earned tips and wages reported on IRS Form W-2.
B. If an employee becomes a Participating Employee more than 60 days after becoming employed as an Eligible Employee, the Service may examine the Participating Employee's tip income received before the employee becomes a Participating Employee, , unless the employee was a participating employee of the Employer or another employer under a tip compliance agreement for any taxable year. Once the employee becomes a Participating Employee, the Service may not examine the Employee's tip income received after the employee becomes a Participating Employee.
C. The Service may not examine tip income of a Participating Employee for any taxable year that ends on or before the Effective Date of this Agreement, provided that during that prior period he or she was:
(1) a participating employee of the Employer under a predecessor agreement between the Employer and the Service and satisfied the terms and conditions of that agreement in that prior taxable year;
(2) a participating employee of another employer who had a Gaming Industry Tip Compliance Agreement (or a predecessor agreement) with the Service and satisfied the terms and conditions of that agreement in that prior taxable year; or
(3) an employee of (i) an employer that did not have a Gaming Industry Tip Compliance Agreement (or predecessor agreement) with the Service or (ii) the Employer but held a position in which he or she was not an Eligible Employee, and he or she filed, if required to do so by law, federal income tax returns for the three taxable years that preceded the Effective Date of this Agreement year.
D. A Nonparticipating Employee is subject to the full range of compliance and enforcement procedures of the Service, at any time, including during the term of this Agreement. (The treatment of the Employer in the case of Nonparticipating Employees is set forth in Section VII.A(2)).
E. At the Service's discretion, the Service may continue any ongoing examination of any employees of the Employer begun by the Service before the Effective Date of this Agreement.

VII. TIP EXAMINATIONS OF EMPLOYER

A. With respect to any taxable year during which this Agreement is in effect:
(1) the Service may not assert liability against the Employer pursuant to section 3121(q) of the Code with respect to the tip income of Participating Employees (except in the limited case provided in subparagraph (2)(ii) immediately below);
(2) the Service may assert liability against the Employer pursuant to section 3121(q) of the Code based on (i) tips received by a Nonparticipating Employee if the asserted liability is based upon the final results of an audit or agreement of the Nonparticipating Employee or (ii) the reporting of additional tip income by an employee.
B. At the Service's discretion, the Service may continue any ongoing examination of the Employer begun by the Service before the Effective Date of this Agreement.

VIII. TIP RATES

A. This Section sets forth the applicable tip rates under this Agreement. The parties established the applicable tip rates as follows:
(1) Employees Who Pool Tips. In satisfaction of their tip reporting obligations under section 6053(a) of the Code with respect to Employees who pool tips, these Employees or their employee group representatives (e.g., the toke committee) shall present to the Employer a listing of the actual share of pooled tips received by or given to each Employee. This listing must reconcile to the tips presented to the Employer's cage for cashing. The tip rate in the case of these Employees is the amount of tips so reported to the Employer with respect to each such Employee.
(2) Other Tipped Employees -- Specified Occupational Categories. By agreement between the Employer and the Service, based on information available from the Employer, historical information available to the Service, and generally accepted accounting principles, tip rates have been established for the occupational categories or subcategories of Eligible Employees (Occupational Category) and, where applicable, shifts listed on Appendix A. These rates specify tips received, by hour, by shift, by drink, by percentage of sales, or other mutually agreed and verifiable bases of measurement depending on the nature of the work performed.
B. (1) In general. The applicable Tip Rates and Occupational Categories established by this Agreement shall remain in effect for the term of this Agreement, unless otherwise modified pursuant to paragraphs B. (2) or (3) of this section.
(2) Mutual agreement process. The Service or the Employer may propose revisions to Tip Rates or Occupational Categories during the term of the Agreement. The non-proposing party will notify the proposing party in writing of approval or disapproval within 60 calendar days of receipt of the proposed revision. The non-proposing party will not unreasonably withhold approval. If accepted, the revisions will become effective upon the date agreed to by the parties.
(3) Specific events. Upon the occurrence of one of the following specific events --
(a) a significant change in the nature of the business (or segment thereof) in which the Participating Employee earns tips (e.g., Employer converts upscale restaurant into coffee shop),
(b) a decrease of 20 percent or more in the Employer's gross monthly revenue as compared to the same month of the previous year, or
(c) a drop below 50 percent in the participation rate of any Occupational Category as of the participation measurement date, the Employer may request that the Service agree to a modification in the relevant Tip Rate of an affected Participating Employee within an Occupational Category (e.g., an outlet or shift) that is appropriate in amount and duration, which consent shall not be unreasonably withheld. The process established in this paragraph B.(3) for the revision of a Tip Rate upon the occurrence of specific events in no way limits the circumstances that may give rise to a request for revision of a Tip Rate under the mutual agreement process described in paragraph B.(2) of this section.

IX. TERM OF AGREEMENT

A. This Agreement shall commence on the Effective Date and shall terminate on XX-XX-XXXX. The Effective Date of this Agreement shall be XX-XX-XXXX.
B. The Service and the Employer agree that, beginning not later than six months prior to the termination date described in paragraph A., they shall commence discussions as to any appropriate revisions to this Agreement, including any appropriate revisions to the tip rates described in Section VIII. In the event that the Service and the Employer have not reached final agreement on the terms and conditions of a renewal Agreement to become effective beginning on XX-XX-XXXX, the parties may, by mutual agreement, extend this agreement for an appropriate time to finalize and execute a renewal Agreement.
C. Neither the Employers nor the Service's decisions regarding renewal of agreements are subject to review.

X. TERMINATION OF AGREEMENT; SURVIVAL OF TERMS

A. If Employee participation is below 75 percent of the Eligible Employees, the Service and Employer shall meet to discuss the cause of the decline in the participation rate and appropriate measures to increase the participation rate. At the meetings, the Employer shall provide information with respect to the records necessary for assessing the tip rate and for assessing the procedures employed to encourage all of the Employer's Eligible Employees to be Participating Employees.
(1) If the Employer undertakes good faith consultations with the Service to discuss these matters and the Employer is not in breach of its obligations under section V.A., the Service may not terminate the Agreement.
(2) If the Employer fails to undertake good faith consultations with the Service to discuss these matters or the Employer is in breach of its obligations under section V.A., the Service may terminate the Agreement.
B. The Service may terminate this Agreement if participation falls below 50 percent of the Eligible Employees. Termination shall be effective beginning with the first calendar quarter that commences after the 60-day period for notice to the Employer.
C. This Agreement may be terminated upon the joint agreement of the Employer and the Service, without the consent of any Participating Employee. The effective date of termination shall be as agreed to by the Employer and the Service.
D. If either party fails to comply with any material provision of this Agreement, the non-defaulting party, at its option, may terminate this Agreement by giving written notice of termination to the other party. Termination of the Agreement shall be effective upon receipt of the notice by the other party.
E. If this Agreement is terminated pursuant to the terms of this agreement, the mutual obligations of the parties shall remain in effect through the effective date of termination. The agreements set forth in Sections VI and VII shall survive termination with respect to taxable periods (or portion thereof) that occur prior to the effective date of termination.

XI. PRECEDENTIAL VALUE

The contents of this agreement may not be used or cited as precedent by any other Employer or other taxpayer and will not bind, or otherwise control, the parties for taxable years or issues not covered by this Agreement.

XII. FAILURE TO COMPLY

If the Employer fails or refuses to provide any of the information required by this Agreement, the Service may employ any lawful means, including the issuance and enforcement of summonses pursuant to sections 7602, 7604 and 7609 of the Code, in order to secure the information.

XIII. COMPLIANCE REVIEW

The Employer agrees that a compliance review or other inspection of books and records, as required for compliance with the terms of this Agreement, will not be considered an inspection of books and records for purposes of section 7605(b) of the Code, or an audit for purposes of section 530 of the Revenue Act of 1978.

XIV. EXCLUSION OF CERTAIN EMPLOYEES

This Agreement does not cover those employees of Employer working in housekeeping and such employees shall not be considered Eligible Employees for purposes of this Agreement.

XV. OTHER AGREEMENTS SUPERSEDED

This Agreement shall supersede all existing tip compliance agreements between the Employer and the Service.

XVI. ENTIRE AGREEMENT

This Agreement contains the final and entire agreement between the Employer and the Service. By signing this Gaming Industry Tip Compliance Agreement, the parties certify that they have read and agreed to the terms of this document, including appendices.

EMPLOYER: Signature (Name Printed), Title, Address, Date

INTERNAL REVENUE SERVICE: Signature (Name Printed) Group Manager, Office of Indian Tribal Governments , Address, Date.

APPENDIX B

NARRATIVE SUMMARY OF TIP RATE METHODOLOGY
The XYZ Casino 12-34356789 is one of three casinos operated by the XYZ Tribe in Anywhere, USA. All three casinos have separate general managers and some different internal controls, each will be covered with its own agreement. All current occupational categories of tipped employees of Casino are included in this Gaming Industry Tip Compliance Agreement. Participation in the plan is a condition of employment. A narrative summary of the tip rate for each of the categories is listed below. The following policies are for all job categories. Employees are not allowed to have personal funds on their person during a shift. Any employee attempting to subvert tip reporting policies will be subject to disciplinary action. Bartender actual. All bars are under continuous surveillance. All tips received by the bartenders from customers and servers are dropped into a clear container on top of the bar. At the end of the shift the relief bartender takes the container to the vault and counts the tips under surveillance. The tips are split between all bartenders on duty for the shift based on hours worked in the presence of a supervisor. The supervisor then documents the amount of total tips recorded on the employee Tip Declaration form and forwards the information to payroll. Payroll includes the tip information on the Employee's biweekly paycheck.
Cage/Change /Vault actual. All tips received are placed in a clear container. At the end of the shift the container is transported to the employee room and tips are counted under surveillance and recorded in the tip log. The form contains name, date, shift, total tips received and is then signed by the employee and the supervisor. The supervisor forwards the information to payroll. Payroll includes the tip information on the Employee's biweekly paycheck.
Cocktail Staffactual. All bars are under continuous surveillance. All tips received will be placed in a clear container on the server's tray. If the servers leave the bar area the tray must be left at the bar or the security desk. At the end of each shift the cocktail staff will go to the beverage office and count out their tips under surveillance and in the presence of the Beverage supervisor on duty. The supervisor then documents the amount of total tips recorded on the employee Tip Declaration form and forwards the information to payroll. Payroll includes the tip information on the Employee's biweekly paycheck.
Deli actual. All tips are placed in a container on the deli counter. At the end of the shift the tips are counted under surveillance and recorded on the employee Tip Declaration form. The form is then signed by the employee and the supervisor. The supervisor forwards the information to payroll. Payroll includes the tip information on the Employee's biweekly paycheck. EVS (environmental services) actual. Any tips received must be accepted in an open hand and then taken directly to the EVS office, and placed and sealed in an envelope with the Employee's name on it. The envelope must then be placed in lock box on the EVS office wall. At the end of the shift the tips are counted by both the employees and the supervisor under surveillance and recorded on the employee's Tip Declaration form. If the employee makes over $20 in tips for a week the Tip Declaration form is forwarded to payroll, and if not, the form remains in the Employee's file.
Retail actual. Each employee logs on to their specific register at the beginning of the shift, each register has its own tip container. At the end of each shift each employee will count out their tips in the presence of the TLC supervisor or retail manager on duty. All tips received are placed in a clear container and taken to the vault and verified under surveillance. The amount of total tips is recorded on the employee Tip Declaration form and sent to payroll. Payroll includes the tip information on the Employee's biweekly paycheck.
Slot Attendants actual. All tips received will be taken to the slot office and placed in a tip box as soon as the attendant receives it. At the end of each shift the supervisor documents the amount of total tips on the employee Tip Declaration form and then both the employee and supervisor sign it. The supervisor will then take all employee tips to the employee room to be verified under surveillance. At the end of the pay period the supervisor forwards the information on the employee Tip Declaration form to payroll. Payroll includes the tip information on the Employee's biweekly paycheck and the employee receives the tip added to their paycheck.
Slot Technicians actual. When any employee receives a tip they must notify the Slot Technician supervisor immediately. The employee will give the tip to the supervisor who will place and seal it in an envelope with the employee's name on it. The envelope must then be placed in a lock box in the supervisor's office. At the end of the shift the tips are counted by both the employees and the supervisor under surveillance and recorded on the employee Tip Declaration form. The amount of total tips recorded on the employee Tip Declaration form is sent to payroll. Payroll includes the tip information on the Employee's biweekly paycheck. The slot tech may take all tips home at the end of the shift.
Table Games actual. All tips received by dealers are deposited into a locked toke box attached to the gaming table. Toke boxes are emptied every 24 hours by two department employees accompanied by a security department employee. All tips are then taken to the vault and counted by table game personnel under surveillance. Vault personnel verify and record the tip totals. These totals are sent to Revenue Auditing. The tips are split between all table games personnel based on position and hours worked. Payroll includes both the tip income and tip information on the Employee's biweekly paycheck.
Transportation The transportation department will no longer accept tips, as of 4/27/2004 any driver accepting tips will be violating company policy.
Valet/Coat Check actual. All tips received are deposited into locked boxes in the valet and coat check areas. The boxes are emptied every 24 hours by department employees accompanied by a security department employee. All tips are then taken to the employee room and counted by the department supervisor under surveillance. The tips are split between department employees based on hours worked. The total tips received by the staffs are recorded on the employee Tip Declaration forms. The form is then signed by the employee and the supervisor. The supervisor forwards the information to payroll. Payroll includes the tip information on the Employee's biweekly paycheck.
Wait Staff & Bussers actual. All dining rooms and kitchen are under continuous surveillance. All tips will be placed in an apron pocket. Any wait staff leaving the area must have supervisor authority. If leaving the area during a shift the employee must remove all tip money from the apron and place it in a labeled envelope to be locked in a drawer at the hostess station. At the end of the Employee's shift the wait staff and shift supervisor will take any envelopes and tips in the apron to the vault and count out their tips under surveillance. The tip-out amount of 10% is counted out for the buss staff. The total tips received by both the Wait and Buss staffs are recorded on the employee Tip Declaration forms. The form is then signed by the employee and the supervisor. The supervisor forwards the information to payroll. Payroll includes the tip information on the Employee's biweekly paycheck.

APPENDIX C
Model Gaming Employee Tip Reporting Agreement
I am an employee of _XYZ Casino 1234 U. S. HWY 10, Anywhere, USA 12345, and by signing this agreement I am choosing to participate in the tip reporting program administered by my employer under the Gaming Industry Tip Compliance Agreement between my employer and the Internal Revenue Service (IRS).
I understand that I have responsibilities under this tip reporting program:
In general, I agree to report to my employer tips at or above the tip rate that has been established for my job. However, I understand that I may report tips below the tip rate if I can substantiate, to the satisfaction of the IRS and subject to a possible review by the IRS, that I earned less tip income than would be reflected by applying the tip rate.
I agree to file my Federal tax return on a timely basis and report those tips and the rest of my earnings from my job as shown on the IRS Form W-2 that my employer gives me and other income.
For each of the three years prior to the date of this agreement, if required to do so, I have filed a Federal tax return on a timely basis. If I have filed all of these tax returns but have not fully paid the tax I owe, I must contact the local office of the IRS within 60 days from now to resolve my account.

If I fulfill my responsibilities and continue to participate under this tip reporting program, I will receive important benefits under this agreement:
If I report to my employer tips at or above the tip rate that has been established for my job, the IRS will not audit my tip income received after the date of this agreement during which the Gaming Industry Tip Compliance Agreement between my employer and the IRS is in effect. If I report tips below such tip rate, the IRS can review my substantiation of that tip income and can make any adjustment necessary to accurately report such income.
The IRS also will not audit my tip income for any prior tax year during which: (1) I was a participant in a prior tip compliance agreement of my current employer or a former employer, or (2) I had no opportunity to participate in a prior tip compliance agreement because I worked in a job that was not covered by an agreement or because my employer did not have a tip compliance agreement with the IRS.
If I was eligible to participate in an Employer's tip compliance agreement in prior tax years but did not do so, I will not be protected from an IRS audit of my tip income for those prior years, but I will receive protection from audit of my tip income received after the date of this agreement during which the Gaming Industry Tip Compliance Agreement between my employer and the IRS is in effect.
If I sign this agreement more than 60 days after I first became employed with my current employer, I will be protected from an IRS audit of my tip income received after the date of this agreement during which the Gaming Industry Tip Compliance Agreement between my employer and the IRS is in effect.

By signing below, I agree to fulfill my responsibilities under this agreement and to participate in the Gaming Industry Tip Compliance Agreement between my employer and the IRS. This agreement shall remain in effect so long as there is a Gaming Industry Tip Compliance Agreement between my employer and the IRS, and I have not notified my employer in writing that I wish to terminate this agreement.
Signature and Employee's name printed, address and Social Security Number.

APPENDIX D
Model Extension Agreement The Gaming Industry
Tip Compliance Agreement (GITCA) signed by (name) and the Commissioner of the Internal Revenue (the parties) and effective on (the date), shall expire on (date). The Parties wish to renew the Agreement, but have not reached final agreement on the terms and conditions of the renewal. In order to allow more time to finalize and execute a renewal, the Parties agree to extend the original Agreement until (date).

Section 3041 of the Technical and Miscellaneous Revenue Act of 1988 (TAMRA) added Internal Revenue Code section 7873, Income Derived by Indians from Exercise of Fishing Rights. This section exempts from federal taxation (i.e., income, employment, and self-employment) any income derived by a member of an Indian tribe or a qualified Indian entity from a fishing rights-related activity of that member's or entity's tribe. The fishing rights must be guaranteed to a tribe by a treaty, statute, or executive order secured as of March 17, 1988.

When a taxpayer reports the receipt of income as excludable from gross income under IRC Section 7873, the examiner should verify the following: