United States Code: Federal Insurance Contributions Act

TITLE 26-INTERNAL REVENUE CODE

(ii) in the case of a taxable termination,the trustee, and

(B) the return shall be filed-(1) in the case of a generation-skipping

transfer occurring before the death of thedeemed transferor, on or before the 90thday after the close of the taxable year ofthe trust in which such transfer occurred,or

(ii) in the case of a generation-skippingtransfer occurring at the same time as, orafter, the death of the deemed transferor,on or before the 90th day after the lastday prescribed by law (including exten-sions) for filing the return of tax underchapter 11 with respect to the estate ofthe deemed transferor (or if later, the daywhich is 9 months after the day on whichsuch generation-skipping transfer oc-curred).

(2) Information returnsThe Secretary may by regulations require

the trustee to furnish the Secretary withsuch information as he determines to be nec-essary for purposes of this chapter.

(Added Pub. L. 94-455, title XX, § 2006(a), Oct.4, 1976, 90 Stat. 1887.)

§ 2622. Regulations

The Secretary shall prescribe such regula-tions as may be necessary or appropriate tocarry out the purposes of this chapter, includ-ing regulations providing the extent to whichsubstantially separate and independent sharesof different beneficiaries in the trust shall betreated as separate trusts.

(Added Pub. L. 94-455, title XX, § 2006(a), Oct.4, 1976, 90 Stat. 1888.)

Subtitle C-Employment Taxes

Chapter Sec.'21. Federal insurance contributions act .................. 310122. Railroad retirement tax act ............ 320123. Federal unemployment tax act ........................... 330124. Collection of income tax at source on wages .... 340125. General provisions relating to employment

taxes ........................................................................... 3501

SUBTITLE REFERRED TO IN OTHME SECTIONS

This subtitle is referred to in sections 1314, 6305,7508, 7512 of this title.

CHAPTER 21-FEDERAL INSURANCECONTRIBUTIONS ACT

Subchapter Sec.'A. Tax on em ployees ................................................... 3101B. Tax on em ployers ................................................... 3111C. G eneral provisions .................................................. 3121

CHAPTER REFEuRED TO IN OTHER SECTIONS

This chapter is referred to in sections 401, 1402,3503, 6011, 6103, 6302, 6501, 6513, 7507, 7509, 7651,7655, 7701 of this title; title 5 section 5901; title 29 sec-tion 1302; title 38 section 4114; title 42 sections 401,405, 408, 418, 2705, 2971g; title 45 section 231f; title 48section 1421h.

'Section numbers editorially added for convenience of users.

Subchapter A-Tax on Employees

Sec.3101. Rate of tax.3102. Deduction of tax from wages.

§ 3101. Rate of tax

(a) Old-age, survivors, and disability insuranceIn addition to other taxes, there is hereby im-

posed on the income of every individual a taxequal to the following percentages of the wages(as defined in section 3121(a)) received by himwith respect to employment (as defined in sec-tion 3121(b))-

(1) with respect to wages received duringthe calendar years 1974 through 2010, therate shall be 4.95 percent; and

(2) with respect to wages received after De-cember 31, 2010, the rate shall be 5.95 per-cent.

(b) Hospital insuranceIn addition to the tax imposed by the preced-

ing subsection, there is hereby imposed on theincome of every individual a tax equal to thefollowing percentages of the wages (as definedin section 3121(a)) received by him with respectto employment (as defined in section 3121(b))-

(1) with respect to wages received duringthe calendar years 1974 through 1977, therate shall be 0.90 percent:

(2) with respect to wages received duringthe calendar years 1978 through 1980, therate shall be 1.10 percent;

(3) with respect to wages received duringthe calendar years 1981 through 1985, therate shall be 1.35 percent; and

(4) with respect to wages received after De-cember 31, 1985, the rate shall be 1.50 per-cent.

(Aug. 16, 1954, ch. 736, 68A Stat. 415; Sept. 1,1954, ch. 1206, title II, § 208(b), 68 Stat. 1094;Aug. 1, 1956, ch. 836, title II, § 202(b), 70 Stat.845; Aug. 28, 1958, Pub. L. 85-840, title IV,§401(b), 72 Stat. 1041; June 30, 1961, Pub. L.87-64, title II, § 201(b), 75 Stat. 141; July 30,1965, Pub. L. 89-97, title I, § 111(c)(5), title III,§ 321(b), 79 Stat. 342, 395; Jan. 2, 1968, Pub. L.90-248, title I, § 109(a)(2), (b)(2), 81 Stat. 836;Mar. 17, 1971, Pub. L. 92-5, title II, § 204(a)(1),85 Stat. 11; July 1, 1972, Pub. L. 92-336,§204(a)(2), (b)(2), 86 Stat. 421, 422; Oct. 30,1972, Pub. L. 92-603, § 135(a)(2), (b)(2), 86 Stat.1362, 1363; Dec. 31, 1973, Pub. L. 93-233,§6(a)(1), (b)(2), 87 Stat. 954, 955; Oct. 4, 1976,Pub. L. 94-455, title XIX, § 1903(a)(1), 90 Stat.1806.)

AMENDmENTs

1976-Subsec. (a). Pub. L. 94-455, § 1903(a)(1)(A), re-designated former pars. (5) and (6) as (1) and (2).Former pars. (1) to (4), which related to a tax rate of3.8 percent with respect to wages received during thecalendar year 1968, a tax rate of 4.2 percent with re-spect to wages received during the calendar years 1969and 1970. a tax rate of 4.6 percent with respect towages received during the calendar years 1971 and1972, and a tax rate of 4.85 percent with respect towages received during the calendar year 1973, respec-tively, were struck out.

Subsec. (b). Pub. L. 94-455, § 1903(a)(1)(B), redesig-nated former pars. (3) to (6) as (1) to (4), respectively.Former pars. (1) and (2), which related to a tax rate of.60 percent with respect to wages received during the

§ 2622 Page 834


calendar years 1968, 1969, 1970, 1971, and 1972 and atax rate of 1.0 percent with respect to wages receivedduring the calendar year 1973, respectively, werestruck out.

1973-Subsec. (a)(4). Pub. L. 93-233, § 6(a)(1), deletedprovision for application of the 4.85 percent rate oftax during calendar years 1974, 1975, 1976, and 1977.

Subsec. (a)(5). Pub. L. 93-233, § 6(a)(l), increased therate of tax from 4.80 percent to 4.95 percent and sub-stituted calendar year "1974" for "1978" as the initialyear for application of such rate.

Subsec. (a)(6). Pub. L. 93-233, § 6(a)(1), increased therate of tax from 5.85 percent to 5.95 percent.

Subsec. (b)(2). Pub. L. 93-233, § 6(b)(2), deleted pro-vision for application of the 1.0 percent rate of taxduring calendar years 1974, 1975, 1976, and 1977.

Subsec. (b)(3). Pub. L. 93-233, § 6(b)(2), incorporatedformer provision of par. (2) for taxation of wages re-ceived during calendar years 1974, 1975, 1976, and1977, decreased the applicable rate of tax from 1.0 per-cent to 0.90 percent, and deleted provision for 1.25 per-cent rate of tax for calendar years 1978, 1979, 1980.

Subsec. (b)(4). Pub. L. 93-233, § 6(b)(2), incorporatedformer provision of par. (3) for taxation of wages re-ceived during calendar years 1978, 1979, and 1980, de-creased the applicable rate of tax from 1.25 percent to1.10 percent, and deleted provision for 1.35 percentrate of tax for calendar years 1981, 1982, 1983, 1984,and 1985.

Subsec. (b)(5). Pub. L. 93-233, § 6(b)(2), incorporatedformer provision of par. (4) for taxation of wages re-ceived during calendar years 1981 through 1985 at ap-plicable 1.35 percent rate of tax and deleted provisionfor 1.45 percent rate of tax for wages received afterDec. 31, 1985.

Subsec. (b)(6). Pub. L. 93-233, § 6(b)(2), incorporatedformer provision of par. (5) for taxation of wages re-ceived after Dec. 31, 1985 and increased the applicablerate of tax from 1.45 to 1.50 percent.

1972-Subsec. (a)(3). Pub. L. 92-603, § 135(a)(2)(A),substituted "the calendar years 1971 and 1972" for"any of the calendar years 19 I through 1977".

Sibsecs. (a)(3) to (5). Pub. L. 92-336, § 204(a)(2), sub-stituted "any of the calendar years 1971 through1977" for "the calendar years 1971 and 1972" Insubsec. (a)(3), "any of the calendar years 1978 through2010" for "the calendar years 1973, 1974, and 1975"and "4.5" for "5.0" in subsec. (a)(4), and "December 31,2010" for "December 31, 1975" and "5.35" for "5.15" insubsec. (a)(5).

Subsec. (a)(4). Pub. L. 92-603, § 135(a)(2)(B), substi-tuted "wages received during the calendar years 1973,1974, 1975, 1976, and 1977, the rate shall le 4.85 per-cent;" for "wages paid during any of the calendaryears 1978 through 2010, the rate shall be 4.5 per cent;and".

Subsec. (a)(5). Pub. L. 92-603, § 135(a)(2)(B), substi'tuted "wages received during the calendar years 1978through 2010, the rate shall be 4.80 percent; and" for"wages paid after December 31, 2010, the rate shall be5.35 percent".

Subsec. (a)(6). Pub. L, 92-603, § 135(a)(2)(B), addedpar. (6).

Subsec. (b)(2). Pub. L. 92-603, § 135(b)(2), increasedthe rate of tax from 0.9 percent to 1.0 percent.

Subsecs. (b)(2) to (5). Pub. L. 92-336, § 204(b)(2),added references to 1976 and 1977 and substituted"0.9" for "0.65" in subsec. (b)(2), substituted refer-ences for the calendar years 1978 through 1985 for ref-erences to the calendar years 1976 through 1979 andsubstituted "1.0" for "0.70" h, subsec. (b)(3), substitut-ed references for the calendai ,ears 1986 through 1992for references to the calendar years 1980 through 1986and substituted "1.1" for "0.80" in subsec. (b)(4), andsubstituted "1992" for "1986" and "1.2" for "0.90" insubsec. (b)(5).

Subsec. (b)(3). Pub. L. 92-603, § 135(b)(2), suostituted"and 1980, the rate shall be 1.25 percent" for "1980,1981, 1982, 1983, 1984, and 1985, the rate shall be 1.0percent".

Subsec. (b)(4). Pub. L. 92-603, § 135(b)(2), substituted"1981. 1982, 1983, 1984, and 1985, the rate shall be 1.35

percent; and" for "1986, 1987, 1988, 1990, 1991, and1992, the rate shall be 1.1 percent; and".

Subsec. (b)(5). Pub. L. 92-603, § 135(b)(2), substituted"December 31, 1985, the rate shall be 1.45 percent" for"December 31, 1992, the rate shall be 1.2 percent".

1971-Subsec. (a)(4). Pub. L. 92-5 substituted "withrespect to wages received during the calendar years1973, 1974, and 1975, the rate shall be 5.0 percent;and" for "with respect to wages received after Decem-ber 31, 1972, the rate shall be 5.0 percent".

Subsec. (a)(5). Pub. L. 92-5 added subsec. (a)(5).1968-Subsecs. (a)(1) to (4). Pub. L. 90-248,

§109(a)(2), substituted "1968" and "3.8" for "1968"and "3.85" in par. (1) and "1969 and 1970" and "4.2"for "1967 and 1968" and "3.9" in par. (2), deleted refer-ence to calendar years 1969 and 1970 from par. (3) andsubstituted therein "4.6" and "4.4", and substituted"5.0" for "4.85" in par. (4).

Subsecs. (b)(1) to (5). Pub. L. 90-248, § 109(b)(2),struck out par. (1) provision for employee rate of 0.35percent of wages received with respect to employmentduring calendar year 1966, redesignated former pars.(2) to (6) as (1) to (5), struck out reference to "1967" insuch par. (1) and increased the rate by 0.10 percent to0.60, 0.65, 0.70, 0.80, and 0.90 in pars. (1) to (5), respec-tively.

1965-Pub. L. 89-97, § 321(b), divided the total taximposed under the entire section upon incomethrough a tax equal to percentages of wages into twoseparate taxes by dividing the section into subsecs. (a)and (b), with subsec. (a) reflecting the tax for old-age,survivors, and disability insurance and subsec. (b) re-flecting the tax for hospital insurance, but, in the caseof subsec. (b), without regard to the provisions of sec-tion 3121(b)(9) insofar as it relates to employees; in-creased from 4% percent to 4.20 percent the rate oftotal tax imposed by the entire section upon wages re-ceived during calendar year 1966 (result'ng from a taxof 3.85 percent under subsec. (a) and 0.35 percentunder subsec. (b)), increased from 41/6 percent to 4.40percent the rate of total tax imposed by the entire sec-tion upon wages received during calendar year 1967(resulting from a tax of 3.9 percent under subsec. (a)and 0.50 percent under subsec. (b)), reduced from 4%percent to 4.40 percent the rate of total tax imposedby the entire section upon wages received during cal-endar year 1968. (resulting from a tax of 3.9 percentunder subsec. (a) and 0.50 percent under subsec. (b)),increased from 4% percent to 4.90 percent the rate forcalendar years 1969, 1970, 1971, and 1972 (resultingfrom a tax of 4.4 percent under subsec. (a) and 0.50percent under subsec. (b)), increased from 4% percentto 5.40 percent the rate for calendar years 1973, 1974,and 1975, (resulting from a tax of 4.85 percent uidersubsec. (a) and 0.55 perccnTt under subsec. (b)), in-creased from 4% percent to 5.45 percent the rate forcalendar years 1976, 1977, 1978, and 1979 (resultingfrom a tax of 4.85 percent under subsec. (a) and 0.60percent under subsec. (b)), increased from 4% percentto 5.55 percent the rate for calendar years 1980through 1986 (resulting from a tax of 4.85 percentunder subsec. (a) and 0.70 percent under subsec. (b)),and increased the rate for calendar years after Dec. 31,1986, to 5.65 percent (resulting from a tax of 4.85 per-cent under subsec. (a) and 0.80 percent under subsec.(b)).

Subsec. (b). Pub. L. 89-9, § 111(c)(5), struck outbut without regard to the provisions of paragraph (9)thereof insofar as it relates to employees" following"as defined in section 3121(b)".

1961-Pub. L. 87-64 increased the rate of tax for cal-endar year 1962 from 3 to 3%/ percent, calendar years1963 to 196a, inclusive, from 3 to 3% percent, calen-dar years 1966 and 1967 from 4 to 41/8 percent, calen-dar sear 1968 from 4 to 4% percent, and for calendaryears after December 31, 1968, from 4 t1o 4% percent.

1958-Pub. L. 85-840 increased the rate of tax bysubstituting provisions imposing a tax of 21/2% for cal-endar year 1959, 3% for calendar years 1960 to 1962,3Y2% for calendar years 1963 to 1965, 4% for calendaryears 1966 to 1968, and 4 % for calendar years begin-

Page 835 § 3101


ning aftor Dec. 31, 1968, for provisions which imposeda tax of 2 % for calendar years 1957 to 1959, 2V%% forcalendar years 1960 to 1964, 3V% for calendar years1965 to 1969, 3 ,% for calendar years 1970 to 1974. and4Y4% for calendar years beginning after Dec. 31, i9'14.

1956-Act Aug. 1, 1956, increased the rate of taxwith respect to wages received during the calendaryears 1957 to 1959, and for all calendar years there-after, by one-quarter percent.

1954-Act Sept. 1, 194, increased the 3V percentrate of tax for the calendar year 1970 and subsequentyears to 3 percent for calendar years 1970 to 1974and 4 percent for 1975 and subsequent years.

xrwcTzvE DATE Or 1976 AsmxNT

Section 1903(d) of Pub. L. 94-455 provided that:"The amendments made by this section [see TablesVolume for distribution of section 1903 of Pub. L. 94-455] shall apply with respect to wages paid after De.cember 31, 1976, except that the amendments made tochapter 22 of the Internal Revenue Code of 1954 [sec-tion 3201 et seq. of this title] shall apply with respectto compensation paid for services rendered after De-cember 31, 1976."

EFTcTrxvE DATE Or 1973 AEM xrVmAmendment of subsecs. (a)(4) to (6) and (b)(2) to (6)

by Pub. L. 93-233 applicable only with respect to re-muneration paid after December 31, 1973, see section6(c) of Pub. L. 93-233, set out as an Effective Date of1973 Amendment note under section 1401 of this title.

EFFcTrv DATE or 1972 AMENDMENTAmendment by Pub. L. 92-603 applicable only with

respect to remuneration paid after Dec. 31, 1972, seesection 135(c) of Pub. L. 92-603, set out as an EffectiveDate of 1972 Amendment note under section 1401 ofthis title.

Amendment by Pub. L. 92-336 applicable only withrespect to remuneration paid after December 31, 1972,see section 204(c) of Pub. L. 92-336, set out as an Ef-fective Date of 1972 Amendment note under section1401 of this title.

E cnTvE DATE or 1971 AmamrrDNTSection 204(b) of Pub. L. 92-5 provided that: "The

amendments made by subsection (a)(1) [amending thissection] shall apply only with respect to taxable yearsbeginning after December 31, 1971. The remainingamendments made by this section [amending section3111 of this title] shall apply only with respect to re-muneration paid after December 31, 1971."

EFFECTIvE DATE OF 1968 AmxinmorrAmendment by section 109 of Pub. L. 90-248 applica-

ble only with respect to remuneration paid after Dec.31, 1967, see section 109(c) of Pub, L. 90-248, set out asan Effective Date of 1968 Amendment note under sec-tion 1401 of this title.

Em c-nv DATE OF 1965 AmENDMENT

Amendment by section 321 of Pub. L. 89-97 applica-ble with respect to remuneration paid after December31, 1965, see section 321(d) of Pub. L. 89-97, set out asan Effective Date of 1965 Amendment note under sec-tion 1401 of this title.

Amendment of subsec. (b) by Pub. L. 89-97,§ 111(c)(5), applicable to calendar year 1966 or to anysubsequent calendar year but only if by October 1 im-mediately preceding such calendar year the RailroadRetirement Tax Act (section 3201 et seq. of this title)provides for a maximum amount of monthly compen-sation taxable under such Act during all months ofsuch calendar year equal to one-twelfth of maximumwages which Federal Insurance Contributions Act(section 3101 et seq. of this title) provides may becounted for such calendar year, see section 111(e) ofPub. L. 89-97, set out as an Effective Date note undersection 13951-1 of Title 42, The Public Health andWelfare.

Enzcivz DATE or 1961 Amm wrM=

Amendment by Pub. L. 87-64 applicable with respectto remuneration paid after Dec. 31, 1981, see section201(d) of Pub. L. 87-64, set out as an Effective Date of1961 Amendment note under section 1401 of this title.

EF-aTIvw DATE OF 1958 AmsrmwrAmendment by Pub. L. 85-840 applicable with re-

spect to remuneration paid after Dec. 31, 1958, see sec-tion 401(d) of Pub. L. 85-840, set out as an EffectiveDate of 1958 Amendment note under section 1401 ofthis title.

En-aTrvm DATE or 1956 AmpENnTr

Amendment by act Aug. 1, 1956, applicable with re-spect to remuneration paid after Dec. 31, 1956, see sec-tion 202(d) of such act Aug. 1, 1956, set out as an Ef-fective Date of 1956 Amendment note under section1401 of this title.

REFRENcEs TO SOCIAL SECURITY ACT

Section 402 of act Sept. 1, 1954, provided that"References in the Internal Revenue Code of 1939

[former Title 26, Internal Revenue Code], the InternalRevenue Code of 1954 [this title], the Railroad Retire-ment Act of 1937, as amended (section 231 et seq. ofTitle 45, Railroads], or any other law of the UnitedStates to any section or subdivision of a section of theSocial Security Act [section 301 et seq. of Title 42, ThePublic Health and Welfare] redesignated by this Actshall be deemed to refer to such section or subdivisionof a section as so redesignated."

CRoss REFEENcSAdjustment of tax under this section, see section

6205 of this title.Amount and method of adjustment inapplicable to

taxes under this chapter, see section 1314 of this title.Assessment for underpaymentof tax imposed by

this section, see section 6205 of this title.Effective date of this subtitle, see section 7851 of

this title.Nondeductibility of taxes imposed by this section as

deduction from gross income, see section 3502 of thistitle.

Priority of debts due to United States, see section191 of Title 31, Money and Finance,

Tax paid by employer not included in definition ofwages under title II of Social Security Act, see section409 of Title 42, The Public Health and Welfare.

SECTION RZnFIUiM TO IN OTHER SECTIONS

This section is referred to in sections 275, 406, 3102,3121, 3201, 3211, 3306, 3502, 6051, 6053, 6205, 8413,6521, 6652 of this title; title 42 sections 401, 418, 907,13951; title 45 section 231e.

SECTION REFERRED TO IN D.C. CODE

This section is referred to in section 46-301 of theDistrict of Columbia Code.

§ 3102. Deduction of tax from wages

(a) RequirementThe tax imposed by section 3101 shall be col-

lected by the employer of the taxpayer, by de-ducting the amount of the tax from the wagesas and when paid. An employer who in any cal-endar quarter pays to an employee cash remu-neration to which paragraph (7)(B) or (C) or(10) of section 3121(a) is applicable may deductan amount equivalent to such tax from anysuch payment of remuneration, even though atthe time of payment the total amount of suchremuneration paid to the employee by the em-ployer in the calendar quarter is less than $50;and an employer who in any calendar year paysto an employee cash remuneration to which

§ 3102 Page 836


paragraph (8)(B) of section 3121(a) is applica-ble may deduct an amount equivalent to suchtax from any such payment of remuneration,even though at the time of payment the totalamount of such remuneration paid to the em-ployee by the employer in the calendar year isless than $150 and the employee has not per-formed agricultural labor for the employer on20 days or more in the calendar year for cashremuneration computed on a time basis; and anemployer who is furnished by an employee awritten statement of tips (received in a calen-dar month) pursuant to section 6053(a) towhich paragraph (12)(B) of section 3121(a) isapplicable may deduct an amount equivalent tosuch tax with respect to such tips from anywages of the employee (exclusive of tips) underhis control, even though at the time such state-ment is furnished the total amount of the tipsincluded in statements furnished to the em-ployer as having been received by the employeein such calendar month in the course of his em-ployment by such employer is less than $20.(b) Indemnification of employer

Every employer required so to deduct the taxshall be liable for the payment of such tax, andshall be indemnified against the claims and de-mands of any person for the amount of anysuch payment made by such employer.(c) Special rule for tips

(1) In the case of tips which constitutewages, subsection (a) shall be applicable onlyto such tips as are included in a written state-ment furnished to the employer pursuant tosection 6053(a), and only to the extent thatcollection can be made by the employer, at orafter the time such statement is so furnishedand before the close of the 10th day followingthe calendar month (or, if paragraph (3) ap-plies, the 30th day following the quarter) inwhich the tips were deemed paid, by deduct-ing the amount of the tax from such wages ofthe employee (excluding tips, but includingfunds turned over by the employee to the em-ployer pursuant to paragraph (2)) as areunder control of the employer.

(2) If the tax imposed by section 3101, withrespect to tips which are included in writtenstatements furnished in any month to theemployer pursuant to section 6053(a), exceedsthe wages of the employee (excluding tips)from which the employer is required to col-lect the tax under paragraph (1); the employ-ee may furnish to the employer on or beforethe 10th day of the following month (or, ifparagraph (3) applies, on or before the 30thday of the following quarter) an amount ofmoney equal to the amount of the excess.

(3) The Secretary may, under regulationsprescribed by him, authorize employers-

(A) to estimate the amount of tips thatwill be reported by the employee pursuantto section 6053(a) in any quarter of the cal-endar year,

(B) to determine the amount to be deduct-ed upon each payment of wages (exclusiveof tips) during such quarter as if the tips soestimated constituted the actual tips so re-ported, and

(C) to deduct upon any payment of wages(other than tins. but including funds turned

over by the employee to the employer pur-suant to paragraph (2)) to such employeeduring such quarter (and within 30 daysthereafter) such amount as may be neces-sary to adjust the amount actually deduct-ed upon such wages of the employee duringthe quarter to the amount required to bededucted in respect of tips included in writ-ten statements furnished to the employerduring the quarter.

(4) If the tax imposed by section 3101 withrespect to tips which constitute wages exceedsthe portion of such tax which can be collect-ed by the employer from the wages of the em-ployee pursuant to paragraph (1) or para-graph (3), such excess shall be paid by theemployee.

(Aug. 16, 1954, ch. 736, 68A Stat. 415; Sept. 1,1954, ch. 1206, title II. § 205A, 68 Stat. 1093;Aug. 1, 1956, ch. 836, title II, § 201(h)(3), 70Stat. 841; July 30, 1965, Pub. L. 89-97, title III,§313(c)(1), (2), 79 Stat. 382, 383; Oct. 4, 1976,Pub. L. 94-455, title XIX, § 1906(b)(13)(A), 90Stat. 1834.)

AMENDMENTS1976-Subsec. (c)(3). Pub. L. 94-455 struck out "or

his delegate" following "Secretary".1965-Subsec. (a). Pub. L. 89-97, §313(c)(2), added

provisions at the end of second sentence allowing a de-duction from any wages of an employee of an amountequivalent to the tax on tips when an employer is fur-nished with a written statement of tips received by anemployee.

Subsec. (c). Pub. L. 89-97, § 313(c)(1), added subsec.(c).

1956-Subsec. (a). Act Aug. 1, 1956, substituted "$150and the employee has not performed agriculturallabor for the employer on 20 days or more in the cal-endar year for cash remuneration computed on a timebasis" for "$100".

1954-Subsec. (a). Act Sept. 1, 1954, added a new sen-tence at the end permitting in certain instances an em-ployer to deduct employee tax even though paymentto the employee is less than $50 for the calendar quar-ter or $100 for the calendar year.

EmCTxvE DATE OF 1965 AMENDMENTAmendment by Pub. L. 89-97 applicable only with

respect to tips received by employees after 1965, seesection 313(f) of Pub. L. 89-97, set out as an EffectiveDate note under section .053 of this title.

CROSS REFERENCES

Deductions as constructive payment, see section3123 of this title.

Receipts for employees for taxes deducted by em-ployers, see section 6051 of this title.

SECTION REFERRE TO IN OTHER SECTIONS

This section is referred to in sections 3402, 3505,6053, 6428 of this title.

Subehapter B-Tax on Employers

Sec.3111.3112.[3113.

Rate of tax.Instrumentalities of the United States.Repealed.]

AMENDMENTS

1976-Pub. L. 94-455, title XIX, § 1903(b), Oct. 4,1976, 90 Stat. 1810, struck out item 3113 "District ofColumbia credit unions".

1956-Act Aug. 1, 1956, ch. 836, title II, § 201(a)(2), 70Stat, 839. added item 3113.

71-999 0 - 78 - 55 (Vol. 7)

Page 837 § 3102


§ 3111. Rate of tax

(a) Old.age, survivors, and disability InsuranceIn addition to other taxes, there is hereby im-

posed on every employer an excise tax, with re-spect to having individuals in his employ, equalto the following percentages of the wages (asdefined in section 3121(a)) paid by him with re-spect to employment (as defined in section3121(b))-

(1) with respect to wages paid during thecalendar years 1974 through 2010, the rateshall be 4.95 percent; and

(2) with respect to wages paid after Decem-ber 31, 2010, the rate shall be 5.95 percent.

(b) Hospital insuranceIn addition to the tax imposed by the preced-

ing subsection, there is hereby imposed onevery employer an excise tax, with respect tohaving individuals in his employ, equal to thefollowing percentages of the wages (as definedin section 3121(a)) paid by him with respect toemployment (as defined in section 3121(b))-

(1) with respect to wages paid during thecalendar years 1974 through 1977, the rateshall be 0.90 percent;

(2) with respect to wages paid during thecalendar years 1978 through 1980, the rateshall be 1.10 percent;

(3) with respect to wages paid during thecalendar years 1981 through 1985, the rateshall be 1.35 percent; and

(4) with respect to wages paid after Decem-ber 31, 1985, the rate shall be 1.50 percent.

(Aug. 16, 1954, ch. 736, 68A Stat. 416; Sept. 1,1954, ch. 1206, title II, § 208(c), 68 Stat. 1094;Aug. 1, 1956. ch. 836, title II, § 202(c), 70 Stat.845; Aug. 28, 1958. Pub. L. 85-840, title IV,§ 401(c), 72 Stat. 1042; June 30, 1961, Pub. L. 87-64, title II, § 201(c), 75 Stat. 141; July 30, 1965,Pub. L. 89-97, title I, § 111(c)(6), title III,§ 321(c), 79 Stat. 343, 396; Jan. 2, 1968, Pub. L.90-248, title I, § 109(a)(3), (b)(3), 81 Stat. 836,837; Mar. 17, 1971, Pub. L. 92-5, title II,§ 204(a)(2), 85 Stat. 11; July 1, 1972, Pub. L. 92-336, title II, § 204(a)(3), (b)(3), 86 Stat. 421, 422;Oct. 30, 1972, Pub. L. 92-603, title I, § 135(a)(3),(b)(3), 86 Stat. 1363, 1364; Dec. 31, 1973, Pub. L.93-233, § 6(a)(2), (b)(3), 87 Stat. 954, 955; Oct. 4,1976, Pub. L. 94-455, title XIX, § 1903(a)(1), 90Stat. 1806.)

AMENDwLTLi

1976-Subsec. (a). Pub. L. 94-455, § 1903(a)(1)(A), re-designated former pars. (5) and (6) as (1) and (2).Former pars. (1) to (4), which related to a tax rate of3.8 percent with respect to wages received during thetaxable year 1968, a tax rate of 4.2 percent with re-spect to wages received during the calendar year 1969and 1970, a tax rate of 4.6 percent with respect towages received during the calendar years 1971 and1972, and a tax rate of 4.8 percent with respect towages received during the calendar year 1973, respec-tively, were struck out.

Subsec. (b). Pub. L. 94-455, § 1903(a)(1)(B), redesig-nated former pars. (3) to (6) as (1) to (4), respectively.Former pars. (1) and (2), which related to a tax rate of.60 percent with respect to wages received during thecalendar years 1968, 1969, 1970, 1971, and 1972 and atax rate of 1.0 percent with respect to wages receivedduring the calendar year 1973, respectively, werestruck out.

1973-Subsec. (a)(4). Pub. . 93-233, § 6(a)(2), deletedprovision for application of the 4.85 percent rate oftax during calendar years 1974, 1975, 1976, and 1977.

Subsec. (a)(5). Pub. L. 93-233, § 6(a)(2), increased therate of tax from 4.80 percent to 4.95 percent and sub-stituted calendar year "1974" to "1978" as the initialyear for application of such rate.

Subsec. (a)(6). Pub. L. 93-233, § 6(a)(2), increased therate of tax from 5.85 percent to 5.95 percent.

Subsec. (b)(2). Pub. L. 93-233, § 6(b)(3), deleted pro-vision for application of the 1.0 percent rate of taxduring calendar years 1974, 1975, 1976, and 1977.

Subsec. (b)(3). Pub. L. 93-233, § 6(b)(3), incorporatedformer provision of par. (2) for taxation of wages re-ceived during calendar years 1974, 1975, 1976, and1977, decreased the applicable rate of tax from 1.0 per-cent to 0.90 percent, and deleted provision for 1.25 per-cent rate of tax for calendix years 1978, 1979, and1980.

Subsec. (b)(4). Pub. L. 93-233, § 6(b)(3), Incorporatedformer provision of par. (3) for taxation of wages re-ceived during calendar years 1978, 1979, and 1980, de-creased the applicable rate of tax from 1.25 percent to1.10 percent, and deleted provision for 1.35 percentrate of tax for calendar years 1981, 1982, 1983. 1984,and 1985.

Subsec. (b)(5). Pub. L. 93-233, § 6(b)(3). incorporatedformer provision of par. (4) for taxation of wages re-ceived during calendar years 1981 through 1985 at ap-plicable 1.35 percent rate of tax and deleted provisionfor 1.45 percent rate of tax for wagLs received afterDec. 31, 1985.

Subsec. (b)(6). Pub. L. 93-233, § 6(b)(3), incorporatedformer provision of par. (5) for taxation of wages re-ceived after Dec. 31, 1985 and increased the applicablerate of tax from 1.45 percent to 1.50 percent.

1972-Subsec. (a)(3). Pub. L. 92-603, § 135(a)(3)(A),substituted "the calendar years 1971 and 1972" for"any of the calendar years 1971 through 1977".

Subsecs. (a)(3) to (5). Pub. L. 92-336, § 204(a)(3), sub-stituted "any of the calendar years 1971 through1977" for "the calendar years 1971 and 1972" insubsec. (a)(3), "any of the calendar years 1978 through2010" for "the calendar years 1973, 1974, and 1975"and "4.5" for "5.0" in subsec. (a)(4), and "December 31,2010" for "December 31, 1975" and "5.35" for "5.15" insubsec. (a)(5).

Subsec. (a)(4). Pub. L. 92-603, § 135(a)(3)(B), suL,-'tuted "paid during the calendar years 1973, 1974, 1975,1976, and 1977, the rate shall be 4.85 percent;" for "re-ceived during any of the calendar years 1978 through2010, the rate shall be 4.5 percent; and".

Subsec. (a)(5). Pub. L. 92-603, § 135(a)(3)(B). substi-tuted "paid during the calendar years 1978 through2010, the rate shall be 4.80 percent; and" for "receivedafter December 31, 2010, the rate shall be 5.35 per.cent".

Subsec. (a)(6). Pub. L. 92-603, § 135(a)(3)(B), addedpar. (6).

Subsec. (b)(2). Pub. L. 92-603, § 135(b)(3), increasedthe rate to 1.0 percent from 0.9 percent.

Subsecs. (b)(2) to (5). Pub. L. 92-336, § 204(b)(3),added references to 1976 and 1977 and substituted"0,9" for "0.65" in subsec. (b)(2), substituted refer-ences for the calendar years 1978 through 1985 for ref-erences to the calendar years 1976 through 1979 andsubstituted "1.0" for "0.70" in subsec. (b)(3), substitut-ed references for the calendar years 1986 through 1992for references to the calendars 1980 through 1986 andsubstituted "1.1" for "0,80" in subsec. (b)(4), and sub-stituted "1992" and "1986" and "1.2" for "0.9" insubsec. (b)(5).

Subsec. (b)(3). Pub. L. 92-603, § 135(b)(3), substituted"and 1980, the rate shall be 1.25 percent" for "1980,1981, 1982, 1983, 1984, and 1985, the rate shall be 1,0percent".

Subsec. (b)(4). Pub. L. 92-603, § 135(b)(3), substituted"1981, 1982, 1983, 1984, and 1985, the rate shall be 1.35percent" for "1986, 1987, 1988, 1989, 1990, 1991, and1992, the rate shall be 1.1 percent".

Page 838§ 3111


Subsec. (b)(5). Pub. L. 92-603, § 135(b)(3), substituted"1985, the rate shall be 1.45 percent" for "1992, therate shall be 1.2 percent".

1971-Subsec. (a)(4). Pub. L. 92-5 substituted "withrespect to wages paid during the calendar years 1973,1974, and 1975, the rate shall be 5.0 percent; and" for"with respect to wages paid after December 31, 1972,the rate shall be 5.0 percent".

Subsec. (a)(5). Pub. L. 92-5 added subsec. (aJ(5).1968-Subsecs. (a)(1) to (4). Pub. L. 90-248,

§ 109(a)(3), substituted "1968" and "3.8" for "1966"and "3.85" in par. (1) and "1969 and 1970" and "4.2"for "1967 and 1968" and "3.9" in par. (2). deleted refer-ence to calendar years 1969 and 1970 from par. (3) andsubstituted therein "4.6" for "4.4", and substituted"5.0" for "4.85" in par. (4).

Subsecs. (b)(1) to (5). Pub. L. 90-248. § 109(b)(3),struck out par. (1) provision for employer rate of 0.35percent of wages paid with respect to employmentduring calendar year 1966, redesignated former pars.(2) to (6) as (1) to (5), struck out reference to "1967" insuch par. (1) and increased the rate by 0.10 percent to0.60, 0.65, 0.70, 0.80, and 0.90 in pars. (1) to (5), respec-tively.

1965-Pub. L. 89-97, § 321(c), divided the total excisetax imposed under the entire section upon employersthrough a tax equal to percentages of wages paid byhim into two separate taxes by dividing the sectioninto subsecs. (a) and (b), with subsec. (a) reflecting thetax for old-age, survivors, and disability insurance, andsubsec. (b) reflecting the tax for hospital insurance,but, in the case of subsec. (b), without regard to theprovisions of section 3121(b)(9) insofar as it relates toemployees; increased from 4% percent to 4.20 percentthe rate of total tax Imposed by the entire sectionupon wages paid during calendar year 1966 (resultingfrom a tax of 3.85 percent under subsec. (a) and 0.35percent under subsec. (b)), increased from 4 percentto 4.40 percent the rate of total tax imposed by theentire section upon wages paid during calendar year1967 (resulting from a tax of 3.9 percent under subsec.(a) and 0.50 percent under subsec. (b)), reduced from4% percent to 4.40 percent the rate of total tax im-posed by the entire section upon wages paid duringcalendar year 1968 (resulting from a tax of 3.9 percentunder subsec. (a) and 0.50 percent under subsec. (b)),increased from 4% percent to 4.90 percent the rate oftotal tax imposed by the entire section upon wagespaid during the calendar years 1969, 1970, 1971, and1972 (resulting from a tax of 4.4 percent under subsec.(a) and 0.50 percent under subsec. (b)), increased from4% percent to 5.40 percent the rate for calendar years1973, 1974, and 1975 (resulting from a tax of 4.85 per-cent under subsec. (a) and 0.55 percent under subsec.(b)), increased from 4% percent to 5.45 percent therate for calendar years 1976, 1977, 1978, and 1979 (re-sulting from a tax of 4.85 percent under subsec. (a)and 0.60 percent under subsec. (b)), increased from 4%percent to 5.55 percent the rate for calendar years1980 through 1986 (resulting from a tax of 4.85 per-cent under subsec. (a) and 0.70 percent under subsec.(b)), and Increased the rate from 4% percent to 5.65percent for calendar years after December 31, 1986(resulting from a tax of 4.85 percent under subsec. (a)and 0.80 percent under subsec. (b)).

Subsec. (b). Pub. 89-97, § 111(c)(6), deleted ", butwithout regard to the provisions of paragraph (9)thereof insofar as it relates to employees" following"as defined in section 3121(b)".

1961-Pub. L 87-64 increased the rate of tax for cal-endar year 1962 from 3 to 3 percent, calendar years1963 to 1965, inclusive, from 3 to 3% percent, calen-dar years 1966 and 1967 from 4 to 4Vs percent, calen-dar year 1968 from 4 to 4% percent, and for calendaryears after December 31, 1968, from 4 to 4% percent.

1958-Pub. L. 85-840 increased the rate of tax bysubstituting provisions imposing a tax of 2 percentfor calendar year 1959, 3 percent for calendar years1960-62, 3 percent for calendar years 1963-65, 4 per-cent for calendar years 1966-68, and' 4 percent forcalendar years beginning after Dec. 31, 1968, for provi-

sions which imposed a tax of 2% percent for calendaryears 1957-59, 2% percent for calendar years 1960-64,3% percent for calendar years 1965-69, 3% percent forcalendar years 1970-74, and 4Y, percent for calendaryears beginning after Dec. 31, 1974.

1956-Act Aug. 1, 1956. increased the rate of taxwith respect to wages paid during the calendar years195" to 1959, and for all calendar years thereafter, byone-quarter percent.

1954-Act Sept. 1, 1954, increased the 3% percentrate of tax for the calendar year 1970 and subsequentyears to 3 percent for calendar years 1970 to 1974* and 4 percent for 1975 and subsequent years.

ErFEcTIvE DATE OF 1976 AMENDMENT

Amendment by Pub. L. 94-455 applicable with re-spect to wages paid after Dec. 31, 1976, see section1903(d) of Pub. L. 94-455, set out as an Effective Dateof 1976 Amendment note under section 3101 of thistitle.

EFmTIVE DATE OF 1973 AMENDMENT

Amendment of subsecs. (a)(4) to (6) and (b)(2) to (6)by Pub. L. 93-233 applicable only with respect to re-muneration paid after December 31, 1973, see section6(c of Pub. L. 93-233, set out as an Effective Date of1973 Amendment note under section 1401 of this title.

EFFFcTIVE DATE OF 1972 Am DmmT

Amendment by Pub. L. 92-603 applicable only withrespect to the remuneration paid after Dec. 31, 1972,see section 135(c) of Pub. L. 92-603, set out as an Ef-fective Date of 1972 Amendment note under section1401 of this title.

Amendment by Pub. L. 92-336 applicable only withrespect to remuneration paid after December 31, 1972,see section 204(c) of Pub. L. 92-336, set out as an Ef-fective Date of 1972 Amendment note under section1401 of this title.

EmrrrxV DATE OF 1971 AmmmcmTAmendment by Pub. L. 92-5 applicable only with re-

spect to remuneration paid after Dec. 31, 1971, see sec-tion 204(b) of Pub. L. 92-5, set out as an Effective Dateof 1971 Amendment note under section 3101 of thistitle.

EFFEcTIvE DATE OF 1968 AM1?msxNT

Amendment by section 109 of Pub. L. 90-248 applica-ble only with respect to remuneration paid after Dec.31, 1967, see section 109(c) of Pub. L. 90-248, set out asan Effective Date of 1968 Amendment note under sec-tion 1401 of this title.

EFFECIVE DATE OF 1965 AummiMzrr

Amendment by section 321 of Pub. L. 89-97 applica-ble with respect to remuneration paid after December31, 1965, see section 321(d) of Pub. L. 89-97, set out asan Effective Date of 1965 Amendment note under sec-tion 1401 of this title.

Amendment of subsec. (b) by Pub. L. 89-97,§ 111(c)(6), applicable to calendar year 1966 or to anysubsequent calendar year but only if by October 1 im-mediately preceding such calendar year the RailroadRetirement Tax Act (section 3201 et seq. of this title)provides for a maximum amount of monthly compen-sation taxable under such Act during all months ofsuch calendar year equal to one-twelfth of maximumwages which Federal Insurance Contributions Act(section 3101 et seq. of this title) provides may becounted for such calendar year, see section 111(e) ofPub. L. 89-97, set out as Effective Date note under sec-tion 1395i-1 of Title 42, The Public Health and Wel-fare.

EFc rivE DATE OF 1961 AWMEmENT

Amendment by Pub. L. 87-64 applicable with respectto remuneration paid after Dec. 31, 1961, see section201(d) of Pub. L. 87-64, set out as an Effective Date of1961 Amendment note under section 1401 of this title.

Page 839 § 3111


ErncTv DATE Or 1958 A mENrmNT

Amendment by Pub. L. 85-840 applicable with re-spect to remuneration paid after Dec. 31, 1958, see sec-tion 401(d) of Pub. L. 85-840, set out as an EffectiveDate of 1958 Amendment note under section 1401 ofthis title.

E crirvz DATE or 1956 AmENDmENT

Amendment by act Aug. 1, 1956, applicable with re-spect to remuneration paid after Dec. 31, 1956, see sec-tion 202(d) of such act Aug. 1, 1956, set out as an Ef-fective Date of 1958 Amendment note under section1401 of this title.

CRoss RE ECES

Adjustment of tax under this section, see section6205 of this title.

Assessment for under payment of tax imposed bythis section, see section 6205 of this title.

Erroneous payments under this chapter as credit onother taxes or refunded, see section 3503 of this title.

Services which are exempt or immune from this taxnot included in definition of employment under titleII of the Social Security Act, see section 409 of Title42, The Public Health and Welfare.

SECTION REFERMD TO IN OTMM SECTIONS

This section is referred to in sections 401, 3112, 3121,3122, 3125, 3211, 3221, 6205, 6413, 6690 of this title;title 42 sections 401, 401a, 418, 907, 13951.

§ 3112. Instrumentalities of the United States

Notwithstanding any other provision of law(whether enacted before or after the enactmentof this section) which grants to any instrumen-tality of the United States an exemption fromtaxation, such instrumentality shall not beexempt from the tax imposed by section 3111unless such other provision of law grants a spe-cific exemption, by reference to section 3111 (orthe corresponding section of prior law), fromthe tax imposed by such section.(Aug. 16, 1954, ch. 736, 68A Stat. 416.)

[§ 3113. Repealed. Pub. L. 94-455, title XIX,§ 1903(a)(2), Oct. 4, 1976, 90 Stat. 18061

Section, added Aug. 1, 1956, ch. 836, title II,§ 201(a)(1), 70 Stat. 839, related to a restriction on ex-emptions from taxation for District of Columbia creditunions with respect to the tax imposed by section 3111of this title.

EEcrzvz DATE oF REPEAL

Repeal of section applicable with respect to wagespaid after Dec. 31, 1976, see section 1903(d) of Pub. L.94-455, set out as an Effective Date of 1976 Amend-ment note under section 3101 of this title.

Subchapter C-General ProvisionsSec.3121. Definitions.3122. Federal service.3123. Deductions as constructive payments.3124. Estimate of revenue reduction.3125. Returns in the case of governmental employees

in Guam, American Samoa, and the District ofColumbia.

3126. Short title,AMENDMENTS

1965-Pub. L. 89-97, title III, §317(c)(3), July 30,1965, 79 Stat. 389, inserted reference to the District ofColumbia in item 3125.

1960-Pub. L. 86-778, title I, § 103(q)(2), Sept. 13,1960, 74 Stat. 940, added item 3125 and redesignatedformer item 3125 as 3126.

§ 3121. Definitions

(a) WagesFor purposes of this chapter, the term

"wages" means all remuneration for employ-ment, including the cash value of all remunera-tion paid in any medium other than cash;except that such term shall not include-

(1) that part of the remuneration which,after remuneration (other than remunerationreferred to in the succeeding paragraphs ofthis subsection) equal to the contribution andbenefit base (as determined under section 230of the Social Security Act) with respect toemployment has been paid to an individual byan employer during the calendar year withrespect to which such contribution and bene-fit base is effective, is paid to such individualby such employer during such calendar year.If an employer (hereinafter referred to assuccessor employer) during the calendar yearwith respect to which such contribution andbenefit base is effective, acquires substantial-ly all the property used in a trade or businessof another employer (hereinafter referred toas a predecessor), or used in a separate unit ofa trade or business of a predecessor, and Im-mediately after the acquisition employes inhis trade or business an individual who imme-diately prior to the acquisition was employedin the trade or business of such predecessor,then, for the purpose of determining whetherthe successor employer has paid remunera-tion (other than remuneration referred to inthe succeeding paragraphs of this subsection)with respect to employment equal to the con-tribution and benefit base (as determinedunder section 230 of the Social Security Act)to such an individual during such calendaryear, any remuneration (other than remu-neration referred to in the succeeding para-graphs of this subsection) with respect to em-ployment paid (or considered under this para-graph as having been paid) to such individualby such predecessor during such calendaryear and prior to such acquisition shall beconsidered as having been paid by such suc-cessor employer;

(2) the amount of any payment (includingany amount paid by an employer for insur-ance or annuities, or into a fund, to providefor any such payment) made to, or on behalfof, an employee or any of his dependentsunder a plan or system established by an em-ployer which makes provision for his employ-ees generally (or for his employees generallyand their dependents) or for a class or classesof his employees (or for a class or classes ofhis employees and their dependents), on ac-count of-

(A) retirement, or(B) sickness or accident disability, or(C) medical or hospitalization expenses in

connection with sickness or accident disabil-ity, or

(D) death;(3) any payment made to an employee (in-

cluding any amount paid by an employer forinsurance or annuities, or into a fund, to pro-vide for any such payment) on account of re-tirement;

§ 3112 Page 840


(4) any payment on account of sickness oraccident disability, or medical or hospitaliza-tion expenses in connection with sickness oraccident disability, made by an employer to,or on behalf of, an employee after the expira-tion of 6 calendar months following the lastcalendar month in which the employeeworked for such employer;

(5) any payment made to, or on behalf of,an employee or his beneficiary-

(A) from or to a trust described in section401(a) which is exempt from tax under sec-tion 501(a) at the time of such paymentunless such payment is made to an employ-ee of the trust as remuneration for servicesrendered as such employee and not as abeneficiary of the trust,

(B) under or to an annuity plan which, atthe time of such payment, is a plan de-scribed in section 403(a), or

(C) under or to a bond purchase planwhich, at the time of such payment, is aqualified bond purchase plan described insection 405(a);

(6) the payment by an employer (withoutdeduction from the remuneration of the em-ployee)-

(A) of the tax imposed upon an employeeunder section 3101 (or the correspondingsection of prior law), or

(B) of any payment required from an em-ployee under a State unemployment com-pensation law;

(7)(A) remuneration paid in any mediumother than cash to an employee for servicenot in the course of the employer's trade orbusiness or for domestic service in a privatehome of the employer;

(B) cash remuneration paid by an employerin any calendar quarter to an employee fordomestic service in a private home of the em-ployer, if the cash remuneration paid in suchquarter by the employer to the employee forsuch service is less than $50. As used in thissubparagraph, the term "domestic service in aprivate home of the employer" does not in-clude service described in subsection (g)(5);

(C) cash remuneration paid by an employerin any calendar quarter to an employee forservice not in the course of the employer'strade or business, if the cash remunerationpaid in such quarter by the employer to theemployee for such service is less than $50. Asused in this subparagraph, the term "servicenot in the course of the employer's trade orbusiness" does not include domestic service ina private home of the employer and does notinclude service described in subsection (g)(5);

(8)(A) remuneration paid in any mediumother than cash for agricultural labor;

(B) cash remuneration paid by an employerin any calendar year to an employee for agri-cultural labor unless (i) the cash remunera-tion paid in such year by the employer to theemployee for such labor is $150 or more, or(ii) the employee performs agricultural laborfor the employer on 20 days or more duringsuch year for cash remuneration computed ona time basis;

(9) any payment (other than vacation orsick pay) made to an employee after the

month in which he attains age 62, if such em-ployee did not work for the employer in theperiod for which such payment is made;

(10) remuneration paid by an employer inany calendar quarter to an employee for ser-vice described in subsection (d)(3)(C) (relatingto home workers), if the cash remunerationpaid in such quarter by the employer to theemployee for such service is less than $50;

(11) remuneration paid to or on behalf ofan employee if (and to the extent that) at thetime of the payment of such remuneration itis reasonable to believe that a correspondingdeduction is allowable under section 217;

(12)(A) tips paid in any medium other thancash;

(B) cash tips received by an employee inany calendar month in the course of his em-ployment by an employer unless the amountof such cash tips is $20 or more;

(13) any payment or series of payments byan employer to an employee or any of his de-pendents which is paid-

(A) upon or after the termination of anemployee's employment relationship be-cause of (I) death, (ii) retirement for disabil-Ity, or (i1) retirement after attaining an agespecified in the plan referred to in subpara-graph (B) or in a pension plan of the em-ployer, and

(B) under a plan established by the em-ployer which makes provision for his em-ployees generally or a class or classes of hisemployees (or for such employees or classor classes of employees and their depen-dents),

other than any such payment or series ofpayments which would have been paid if theemployee's employment relationship had notbeen so terminated.

(14) any payment made by an employer to asurvivor or the estate of a former employeeafter the calendar year in which such employ-ee died; or

(15) any payment made by an employer toan employee, if at the time such payment ismade such employee is entitled to disabilityinsurance benefits under section 223(a) of theSocial Security Act and such entitlementcommenced prior to the calendar year inwhich such payment is made, and if such em-ployee did not perform any services for suchemployer during the period for which suchpayment is made.

(b) EmploymentFor purposes of this chapter, the term "em-

ployment" means any service, of whatevernature, performed either (A) by an employeefor the person employing him, irrespective ofthe citizenship or residence of either, (i) withinthe United States, or (ii) on or in connectionwith an American vessel or American aircraftunder a contract of service which is enteredinto within the United States or during the per-formance of which and while the employee isemployed on the vessel or aircraft it touches ata port in the United States, if the employee isemployed on and in connection with such vesselor aircraft when outside the United States, or(B) outside the United States by a citizen of theUnited States as an employee for an American

Page 841 § 3121


employer (as defined in subsection (h)); exceptthat such term shall not include-

(1) service performed by foreign agricultur-al workers (A) under contracts entered into inaccordance with title V of the AgriculturalAct of 194G, as amended (7 U.S.C. 1461-1468),or (B) lawfully admitted to the United Statesfrom the Bahamas, Jamaica, and the otherBritish West Indies, or from any other for-eign country or possession thereof, on a tem-porary basis to perform agricultural labor;

(2) domestic service performed in a localcollege club, or local chapter of a college fra-ternity or sorority, by a student who is en-rolled and is regularly attending classes at aschool, college, or university;

(3)(A) service performed by an individual inthe employ of his spouse, and service per-formed by a child under the age of 21 in theemploy of his father or mother;

(B) service not in the course of the employ-er's trade or business, or domestic service in aprivate home of the employer, performed byan individual in the employ of his son ordaughter; except that the provisions of thissubparagraph rhall not be applicable to suchdomestic service if-

(i) the employer is a surviving spouse or adivorced individual and has not remarried,or has a spouse living in the home who hasa mental or physical condition which re-sults in such spouse's being incapable ofcaring for a son, daughter, stepson, or step-daughter (referred to in clause (ii)) for atleast 4 continuous weeks in the calendarquarter in which the service is rendered,and

(ii) a son, daughter, stepson, or step-daughter of such employer is living in thehome, and

(iii) the son, daughter, stepson, or step-daughter (referred to in clause (i)) has notattained age 18 or has a mental or physicalcondition which requires the personal careand supervision of an adult for at least 4continuous weeks in the calendar quarter inwhich the service is rendered;(4) service performed by an individual on or

in connection with a vessel not an Americanvessel, or on or in connection with an aircraftnot an American aircraft, if CA) the individualis employed on and in connection with suchvessel or aircraft, when outside the UnitedStates and (B)(i) such individual is not a citi-zen of the United States or (i) the employeris not an American employer;

(5) service performed in the employ of anyinstrumentality of the United States, if suchinstrumentality is exempt from the tax im-posed by section 3111 by virtue of any provi-sion of law which specifically refers to suchsection (or the corresponding section of priorlaw) in granting such exemption;

(6)(A) service performed in the employ ofthe United States or in the employ of any in-strumentality of the United States, if suchservice is covered by a retirement system es-tablished by a law of the United States;

(B) service performed, by an individual inthe employ of an instrumentality of theUnited States if such an instrumentality wasexempt from the tax imposed by section 1410

of the Internal Revenue Code of 1939 on De-cember 31, 1950, and if such service is coveredby a retirement system established by suchinstrumentality; except that the provisions ofthis subparagraph shall not be applicable to-

(i) service performed in the employ of acorporation which is wholly owned by theUnited States;

(it) service performed in the employ of aFederal land bank, a Federal intermediatecredit bank, a bank for cooperatives, a Fed-eral land bank asgociation, a productioncredit association, a Federal Reserve Bank,a Federal Home Loan Bank, or a FederalCredit Union;

(i11) service performed in the employ of aState, county, or community committeeunder the Commodity Stabilization Service;

(iv) service performed by a civilian em-ployee, not compensated from funds appro-priated by the Congress, in the Army andAir Force Exchange Service, Army and AirForce Motion Picture Service, Navy Ex-changes, Marine Corps Exchanges, or otheractivities, conducted by an instrumentalityof the United States subject to the jurisdic-tion of the Secretary of Defense, at installa-tions of the Department of Defense for thecomfort, pleasure, contentment, and mentaland physical improvement of personnel ofsuch Department; or

Cv) service performed by a civilian employ-ee, not compensated from funds appropriat-ed by the Congress, in the Coast Guard Ex-changes or other activities, conducted by aninstrumentality of the United States sub-Ject to the Jurisdiction of the Secretary ofTransportation, at installations of theCoast Guard for the comfort, pleasure, con-tentment, and mental and physical im-provement of personnel of the Coast Guard;

(C) service performed in the employ of theUnited States or in the employ of any instru-mentality of the United States, if such serviceis performed-

(i) as the President or Vice President ofthe United States or as a Member, Delegate,or Resident Commissioner of or to the Con-gress;

(ii) in the legislative branch;(Iit) in a penal institution of the United

States by on inmate thereof;(iv) by any individual as an employee in-

cluded uder section 5351(2) of title 5,United States Code (relating to certain in-terns, student nurses, and other studentemployees of hospitals of the Federal Gov-ernment), other than as a medical or dentalintern or a medical or dental resident intraining;

(v) by any individual as an employee serv-ing on a temporary basis in case of fire,storm, earthquake, flood, or other similaremergency; or

(vi) by any individual to whom subchapterIII of chapter 83 of title 5, United StatesCode, does not apply because such individ-ual is subject to another retirement system(other than the retirement system of theTennessee Valley Authority);

§ 3121 Page 842


(7) service performed in the employ of aState, or any political subdivision thereof, orany instrumentality of a.y one or more ofthe foregoing which is wholly owned thereby,except that this paragraph shall not apply inthe case of-

(A) service which, under subsection (J),constitutes covered transportation service,

(B) service in the employ of the Govern-(-nt of Guam or the Government of

American Samoa or any political subdivi-sion thereof, or of any instrumentality ofany one or more of the foregoing which iswholly owned thereby, performed by an of-ficer or employee thereof (including amember of the legislature of any such Gov-ernment or political subdivision), and forpuri5oses of this title with respect to thetaxes Imposed by this chapter-

(i) any person whose service as such anofficer or employee is not covered by a re-tirement system established by a law ofthe United States shall not, with respectto such service, be regarded as an employ-ee of the United States or any agency orinstrumentality thereof, and

(i) the remuneration for service de-scribed in clause (1) (including fees paid toa public official) shall be deemed to havebeen paid by the Government of Guam orthe Government of American Samoa orby a political subdivision thereof or an in-strumentality of any one or more of theforegoing which is wholly owned thereby,whichever is appropriate,(C) service performed in the employ of

the District of Columbia or any instrumen-tality which is wholly owned thereby, ifsuch service is not covered by a retirementsystem established by a law of the UnitedStates; except that the provisions of thissubparagraph shall not be applicable to ser-vice performed-

(i) in a hospital or penal institution by apatient or inmate thereof;

(ii) by any individual as an employee in-cluded under section 5351(2) of title 5,United States Code (relating to certain in-terns, student nurses, and other studentemployees of hospitals of the District ofColumbia Government), other than as amedical or dental intern or as a medical ordental resident in training;

(iII) by any individual as an employeeserving on a temporary basis in case offire, storm, snow, earthquake, flood orother similar emergency;

(iv) by a member of a board, committee,or council of the District of Columbia,paid on a per diem, meeting, or other feebasis; or(D) service performed in the employ of

the Government of Guam (or any instru-mentality which is wholly owned by suchGovernment) by an employee properly clas-sified as a temporary or intermittent em-ployee, if such service is not covered by a re-tirement system established by a law ofGuam; except that (i) the provisions of thissubparagraph shall not be applicable to ser-vices performed by an elected official or a

member of the legislature or in a hospitalor penal Institution by a patient or inmatethereof, and (ii) for purposes of this subpar-agraph, clauses (i) and (ii) of subparagraph(B) shall apply;(8)(A) service performed by a duly ordained,

commissioned, or licensed minister of achurch in the exercise of his ministry or by amember of a religious order in the exercise ofduties required by such order, except thatthis subparagraph shall not apply to serviceperformed by a member of such an order inthe exercise of such duties, if an election ofcoverage under subsection (r) is in effect withrespect to such order, or with respect to theautonomous subdivision thereof to whichsuch member belongs;

(B) service performed in the employ of a re-ligious, charitable, educational, or other orga-nization described in section 501(c)(3) whichis exempt from income tax under section501(a), but this subparagraph shall not applyto service performed during the period forwhich a certificate, filed pursuant to subsec-tion (k) (or the corresponding subsection ofprior law) or deemed to have been so filedunder paragraph (4) or (5) of such subsection,is n effect if such service Is performed by anemployee-

(i) whose signature appears on the listfiled (or deemed to have been filed) by suchorganization under subsection (k) (or thecorresponding subsection of prior law),

(ii) who became an employee of such orga-nization after the calendar quarter in whichthe certificate (other than a certificate re-ferred to in clause (iii) was filed (or deemedto have been filed), or

(iII) who, after the calendar quarter inwhich the certificate was filed (or deemedto have been filed) with respect to a groupdescribed in section 3121(k)(1)(E), became amember of such group,

except that this subparagraph shall applywith respect to service performed by an em-ployee as a member of a group described insection 3121(k)(1)(E) with respect to which nocertificate is (or is deemed to be) in effect;

(9) service performed by an individual as anemployee or employee representative as de-fined in section 3231;

(10)(A) service performed in any calendarquarter in the employ of any organizationexempt from income tax under section 501(a)other than an organization described in sec-tion 401(a) or under section 521, if the remu-neration for such service is less than $50;

(B) service performed in the employ of-(I) a school, college, or university, or(it) an organization described in section

509(a)(3) if the organization is organized,and at all times thereafter is operated, ex-clusively for the benefit of, to perform thefunctions of, or to carry out the purposes ofa school, college, or university and is operat-ed, supervised, or controlled by or in con-nection with such school, college, or univer-sity, unless it is a school, college, or univer-sity of a State or a political subdivisionthereof and the services performed in itsemploy by a student referred to in section

Page 843 § 3121


218(c)(5) of the Social Security Act are cov-ered under the agreement between the Sec-retary of Health, Education, and Welfareand such State entered into pursuant to sec-tion 218 of such Act;

if such service is performed by a student whois enrolled and regularly attending classes atsuch school, college, or university;

(11) service performed in the employ of aforeign government (including service as aconsular or other officer or employee or anondiplomatic representative);

(12) service performed in the employ of aninstrumentality wholly owned by a foreigngovernment-

(A) if the service is of a character similarto that performed in foreign countries byemployees of the United States Govern-ment or of an instrumentality thereof; and

(B) if the Secretary of State shall certifyto the Secretary of the Treasury that theforeign government, with respect to whoseinstrumentality and employees thereof ex-emption is claimed, grants an equivalent ex-emption with respect to similar service per-formed in the foreign country by employeesof the United States Government and of in-strumentalities thereof;(13) service performed as a student nurse in

the employ of a hospital or a nurses' trainingschool by an individual who is enrolled and isregularly attending classes in a nurses' train-ing school chartered or approved pursuant toState law;

(14)(A) service performed by an individualunder the age of 18 in the delivery or distri-bution of newspapers or shopping news, notincluding delivery or distribution to any pointfor subsequent delivery or distribution;

(B) service performed by an individual in,and at the time of, the sale of newspapers ormagazines to ultimate consumers, under anarrangement under which the newspapers ormagazines are to be sold by him at a fixedprice, his compensation being based on the re-tention of the excess of such price over theamount at which the newspapers or maga-zines are charged to him, whether or not he Isguaranteed a minimum amount of compensa-tion for such service, or is entitled to be cred-ited with the unsold newspapers or magazinesturned back;

(15) service performed in the employ of aninternational organization;

(16) service performed by an individualunder an arrangement with the owner ortenant of land pursuant to which-

(A) such individual undertakes to produceagricultural or horticultural commodities(including livestock, bees, poultry, and fur-bearing animals and wildlife) on such land,

(B) the agricultural or horticultural com-modities produced by such individual, orthe proceeds therefrom, are to be dividedbetween such individual and such owner ortenant, and

(C) the amount of such individual's sharedepends on the amount of the agriculturalor horticultural commodities produced;(17) service in the employ of any organiza-

tion which is performed (A) in any quarter

during any part of which such organization isregistered, or there is in effect a final order ofthe Subversive Activities Control Board re-quiring such organization to register, underthe Internal Security Act of 1950, as amend-ed, as a Communist-action organization, aCommunist-front organization, or a Commu-nist-infiltrated organization, and (B) afterJune 30, 1956;

(18) service performed in Guam by a resi-dent of the Republic of the Philippines whilein Guam on a temporary basis as a nonimmi-grant alien admitted to Guam pursuant tosection 101(a)(15)(H)(iI) of the Immigrationand Nationality Act (8 U.S.C.1101(a)(15)(11)(Mi);

(19) Service which is performed by a non-resident alien individual for the period he Istemporarily present in the United States as anonimmigrant under subparagraph (F) or (J)of section 101(a)(15) of the Immigration andNationality Act, as amended, and which isperformed to carry out the purpose specifiedin subparagraph (F) or (J), as the case maybe; or

(20) service performed by an individual on aboat engaged in catching fish or other formsof aquatic animal life under an arrangementwith the owner or operator of such boat pur-suant to which-

(A) such individual does not receive anycash remuneration (other than as providedin subparagraph (B)),

(B) such individual receives a share of theboat's (or the boats' in the case of a fishingoperation involving more than one boat)catch of fish or other forms of aquaticanimal life or a share of the proceeds fromthe sale of such catch, and

(C) the amount of such individual's sharedepends on the amount of the boat's (or theboats' in the case of a fishing operation in-volving more than one boat) catch of fish orother forms of aquatic animal life,

but only if the operating crew of such boat(or each boat from which the individual re-ceives a share in the case of a fishing oper-ation involving more than one boat) is nor-mally made up of fewer than 10 individuals.

(c) Included and excluded serviceFor purposes of this chapter, if the services

performed during one-half or more of any payperiod by an employee for the person employ-ing him constitute employment, all the servicesof such employee for such period shall bedeemed to be employment; but if the servicesperformed during more than one-half of anysuch pay period by an employee for the personemploying him do not constitute employment,then none of the services of such employee forsuch period shall be deemed to be employment.As used in this subsection, the term "payperiod" means a period (of not more than 31consecutive days) for which a payment of remu-neration is ordinarily made to the employee bythe person employing him. This subsectionshall not be applicable with respect to servicesperformed in a pay period by an employee forthe person employing him, where any of suchservice is excepted by subsection (b)(9).

Page 844§ 3121


(d) EmployeeFor purposes of this chapter, the term "em-

ployee" means-(1) any officer of a corporation; or(2) any individual who, under the usual

common law rules applicable in determiningthe employer-employee relationship, has thestatus of an employee; or

(3) any individual (other than an individualwho is an employee under paragraph (1) or(2)) who performs services for remunerationfor any person-

(A) as an agent-driver or commission-driver engaged in distributing meat prod-ucts, vegetable products, fruit products,bakery products, beverages (other thanmilk), or laundry or drycleaning services,for his principal;

(B) as a full-time life insurance salesman;(C) as a home worker performing work,

according to specifications furnished by theperson for whom the services are per-formed, on materials or goods furnished bysuch person which are required to be re-turned to such person or a person designat-ed by him; or

(D) as a traveling or city salesman, otherthan as an agent-driver or commission-driver, engaged upon a full-time basis in thesolicitation on behalf of, and the transmis-sion to, his principal (except for side-linesales activities on behalf of some otherperson) of orders from wholesalers, retail-ers, contractors, or operators of hotels, res-taurants, or other similar establishmentsfor merchandise for resale or supplies foruse in their business operations;

if the contract of service contemplates thatsubstantially all of such services are to be per-formed personally by such individual; exceptthat an individual shall not be included in theterm "employee" under the provisions of thisparagraph if such individual has a substantialinvestment in facilities used in connectionwith the performance of such services (otherthan in facilities for transportation), or if theservices are in the nature of a single transac-tion not part of a continuing relationshipwith the person for whom the services areperformed.

(e) State, United States, and citizenFor purposes of this chapter-(1) State

The term "State" includes the District ofColumbia, the Commonwealth of PuertoRico, the Virgin Islands, Guam, and AmericanSamoa.(2) United States

The term "United States" when used in ageographical sense includes the Common-wealth of Puerto Rico, the Virgin Islands,Guam, and American Samoa.

An individual who is a citizen of the Common-wealth of Puerto Rico (but not otherwise a citi-zen of the United States) shall be considered,for purposes of this section, as a citizen of theUnited States.(f) American vessel and aircraft

For purposes of this chapter, the term"American vessel" means any vessel document-

ed or numbered under the laws of the UnitedStates; and includes any vessel which is neitherdocumented or numbered under the laws of theUnited States nor documented under the lawsof any foreign country, if its crew is employedsolely by one or more citizens or residents ofthe United States or corporations organizedunder the laws of the United States or of anyState; and the term "American aircraft" meansan aircraft registered under the laws of theUnited States.(g) Agricultural labor

For purposes of this chapter, the term "agri-cultural labor" includes all service performed-

(1) on a farm, In the employ of any person,in connection with cultivating the soil, or inconnection with raising or harvesting any ag-ricultural or horticultural commodity, includ-ing the raising, shearing, feeding, caring for,training, and management of livestock, bees,poultry, and fur-bearing animals and wildlife;

(2) in the employ of the owner or tenant orother operator of a farm, in connection withthe operation, management, conservation, im-provement, or maintenance of such farm andits tools and equipment, or in salvagingtimber or clearing land of brush and otherdebris left by a hurricane, if the major part ofsuch service is performed on a farm;

(3) in connection with the production orharvesting of any commodity defined as anagricultural commodity in section 15(g) of theAgricultural Marketing Act, as amended (12U.S.C. 1141J), or in connection with the gin-ning of cotton, or in connection with the op-eration or maintenance of ditches, canals, res-ervoirs, or waterways, not owned or operatedfor profit, used exclusively for supplying andstoring water for farming purposes;

(4)(A) in the employ of the operator of afarm in handling, planting, drying, packing,packaging, processing, freezing, grading, stor-ing, or delivering to storage or to market or toa carrier for transportation to market, in itsunmanufactured state, any agricultural orhorticultural commodity; but only if such op-erator produced more than one-hal! of thecommodity with respect to which such serviceis performed;

(B) in the employ of a group of operators offarms (other than a cooperative organization)in the performance of service described insubparagraph (A), but only if such operatorsproduced all of the commodity with respectto which such service is performed. For pur-poses of this subparagraph, any unincorporat-ed group of operators shall be deemed a coop-erative organization if the number of opera-tors comprising such group is more than 20 atany time during the calendar quarter inwhich such service is performed;

(C) the provisions of subparagraphs (A) and(B) shall not be deemed to be applicable withrespect to service performed in connectionwith commercial canning or commercial freez-ing or in connection with any agricultural orhorticultural commodity after its delivery toa terminal market for distribution for con-sumption; or

(5) on a farm operated for profit if such ser-vice is not in the course of the employer's

Page 845 § 3121


trade or business or is domestic service in aprivate home of the employer.

As used in this subsection, the term "farm" in-cludes stock, dairy, poultry, fruit, fur-bearinganimal, and truck farms, plantations, ranches,nurseries, ranges, greenhouses or other similarstructures used primarily for the raising of ag-ricultural or horticultural commodities, and or-chards.(h) American employer

For purposes of this chapter, the term"American employer" means an employerwhich is-

(1) the United States or any instrumental-ity thereof,

(2) an individual who is a resident of theUnited States,

(3) a partnership, if two-thirds or more ofthe partners are residents of the UnitedStates,

(4) a trust, if all of the trustees are resi-dents of the United States, or

(5) a corporation organized under the lawsof the United States or of any State.

(I) Computation of wages In certain cases(1) Domestic service

For purposes of this chapter, in the case ofdomestic service described in subsection(a)(7)(B), any payment of cash remunerationfor such service which is more or less than awhole-dollar amount shall, under such condi-tions and to such extent as may be prescribedby regulations made under this chapter, becomputed to the nearest dollar. For the pur-pose of the computation to the nearest dollar,the payment of a fractional part of a dollarshall be disregarded unless it amounts to one-half dollar or more, in which case it shall beincreased to $1. The amount of any paymentof cash remuneration so computed to thenearest dollar shall, in lieu of the amount ac-tually paid, be deemed to constitute theamount of cash remuneration for purposes ofsubsection (a)(7)(B).(2) Service In the uniformed services

For purposes of this chapter, in the case ofan individual performing service, as a memberof a uniformed service, to which the provi-sions of subsection (m)(1) are applicable, theterm "wages" shall, subject to the provisionsof subsection (a)(1) of this section, include assuch individual's remuneration for such ser-vice only his basic pay as described in section102(10) of the Servicemen's and Veterans'Survivor Benefits Act.(3) Peace Corps volunteer service

For purposes of this chapter, in the case ofan individual performing service, as a volun-teer or volunteer leader within the meaningof the Peace Corps Act, to which the provi-sions of section 3121(p) are applicable, theterm "wages" shall, subject to the provisionsof subsection (a)(1) of this section, include assuch individual's remuneration for such ser-vice only amounts paid pursuant to section5(c) or 6(l) of the Peace Corps Act.

(4) Service performed by certain members of reli-gious orders

For purposes of this chapter, in any casewhere an individual is a member of a religiousorder (as defined in subsection (r)(2)) per-forming service in the exercise of duties re-quired by such order, and an election of cov-erage under subsection (r) is in effect with re-spect to such order or with respect to theautonomous subdivision thereof to whichsuch member belongs, the term "wages" shall,subject to the provisions of subsection (a)(1),include as such individual's remuneration forsuch service the fair market value of anyboard, lodging, clothing, and other perquisitesfurnished to such member by such order orsubdivision thereof or by any other person ororganization pursuant to an agreement withsuch order or subdivision, except that theamount included as such individual's remu-neration under this paragraph shall not beless than $100 a month.

(j) Covered transportation serviceFor purposes of this chapter-(1) Existing transportation systems-General rule

Except as provided in paragraph (2), all ser-vice performed in the employ of a State or po-litical subdivision in connection with its oper-ation of a public transportation system shallconstitute covered transportation service ifany part of the transportation system was ac-quired from private ownership after 1936 andprior to 1951.(2) Existing transportation systems--Cases In

which no transportation employees, or onlycertain employees, are covered

Service performed in the employ of a Stateor political subdivision in connection with theoperation of its public transportation systemshall not constitute covered transportationservice if-

(A) any part of the transportation systemwas acquired from private ownership after1936 and prior to 1951, and substantially allservice in connection with the operation ofthe transportation system was, on Decem-ber 31, 1950, covered under a general retire-ment system providing benefits which, byreason of a provision of the State constitu-tion dealing specifically with retirementsystems of the State or political subdivi-sions thereof, cannot be diminished or im-paired; or

(B) no part of the transportation systemoperated by the State or political subdivi-sion on December 31, 1950, was acquiredfrom private ownership after 1936 and priorto 1951;

except that if such State or political subdivi-sion makes an acquisition after 1950 from pri-vate ownership of any part of its transporta-tion system, then, in the case of any employ-ee who-

(C) became an employee of such State orpolitical subdivision in connection with andat the time of its acquisition after 1950 ofsuch part, and

(D) prior to such acquisition rendered ser-vice in employment (including as employ-ment service covered by an agreementunder section 218 of the Social Security

§ 3121 Page 846


Act) in connection with the operation ofsuch part of the transportation system ac-quired by the State or political subdivision,

the service of such employee in connectionwith the operation of the transportationsystem shall constitute covered transporta-tion service, commencing with the first day ofthe third calendar quarter following the cal-endar quarter in which the acquisition ofsuch part took place, unless on such first daysuch service of such employee is covered by ageneral retirement system which does not,with respect to such employee, contain spe-cial provisions applicable only to employeesdescribed in subparagraph (C).(3) Transportation systems acquired after 1950

All service performed in the employ of aState or political subdivision thereof in con-nection with its operation of a public trans-portation system shall constitute coveredtransportation service if the transportationsystem was not operated by the State or po-litical subdivision prior to 1951 and, at thetime of its first acquisition (after 1950) fromprivate ownership of any part of its transpor-tation system, the State or political subdivi-sion did not have a general retirement systemcovering substantially all service performed inconnection with the operation of the trans-portation system.(4) Definitions

For purposes of this subsection-(A) The term "general retirement system"

means any pension, annuity, retirement, orsimilar fund or system established by aState or by a political subdivision thereoffor employees of the State, political subdivi-sion, or both; but such term shall not in-clude such a fund or system which coversonly service performed in positions connect-ed with the operation of its public transpor-tation system.

(B) A transportation system or a partthereof shall be considered to have been ac-quired by a State or political subdivisionfrom private ownership if prior to the ac-quisition service performed by employees inconnection with the operation of thesystem or part thereof acquired constitutedemployment under this chapter or sub-chapter A of chapter 9 of the Internal Rev-enue Code of 1939 or was covered by anagreement made pursuant to section 218 ofthe Social Security Act and some of suchemployees became employees of the Stateor political subdivision in connection withand at the time of such acquisition.

(C) The term "political subdivision" in-cludes an instrumentality of-

(i) a State,(ii) one or more political subdivisions of

a State, or(iii) a State and one or more of its politi-

cal subdivisions.(k) Exemption of religious, charitable, and certain

other organizations(1) Waiver of exemption by organization

(A) An organization described in section501(c)(3) which is exempt from income taxunder section 501(a) may file a certificate

(in such form and manner, and with suchofficial, as may be prescribed by regulationsmade under this chapter) certifying that itdesires to have the insurance system estab-lished by title II of the Social Security Actextended to ,ervice performed by its em-ployees. Such certificate may be filed onlyif it is accompanied by a list containing thesignature, address, and social security ac-count number (if any) of each employee (ifany) who concurs in the filing of the certifi-cate. Such list may be amended at any timeprior to the expiration of the twenty-fourthmonth following the calendar quarter inwhich the certificate is filed by filing withthe prescribed official a supplemental list orlists containing the signature, address, andsocial security account number (if any) ofeach additional employee who concurs inthe filing of the certificate. The list and anysupplemental list shall be filed in such formand manner as may be prescribed by regula-tions made under this chapter.

(B) The certificate shall be in effect (forpurposes of subsection (b)(8)(B) and forpurposes of section 210(a)(8)(B) of theSocial Security Act) for the period begin-ning with whichever of the following maybe designated by the organization:

(i) the first day of the calendar quarterin which the certificate is filed,

(ii) the first day of the calendar quartersucceeding such quarter, or

(ill) the first day of any calendar quar-ter preceding the calendar quarter inwhich the certificate is filed, except thatsuch date may not be earlier than thefirst day of the twentieth calendar quar-ter preceding the quarter in which suchcertificate is filed.

(C) In the case of service performed by anemployee whose name appears on a supple-mental list filed after the first month fol-lowing the calendar quarter in which thecertificate is filed, the certificate shall be ineffect (for purposes of subsection (b)(8)(B)and for purposes of section 210(a)(8)(B) ofthe Social Security Act) only with respectto service performed by such individual forthe period beginning with the first day ofthe calendar quarter in which such supple-mental list is filed.

(D) The period for which a certificatefiled pursuant to this subsection or the cor-responding subsection of prior law is effec-tive may be terminated by the organization,effective at the end of a calendar quarter,upon giving 2 years' advance notice in writ-ing, but only if, at the time of the receipt ofsuch notice, the certificate has been ineffect for a period of not less than 8 years.The notice of termination may be revokedby the organization by giving, prior to theclose of the calendar quarter specified inthe notice of termination, a written noticeof such revocation. Notice of termination orrevocation thereof shall be filed in suchform and manner, and with such official, asmay be prescribed by regulations madeunder this chapter.

(E) If an organization described in subpar-agraph (A) employs both individuals who

Page 847 § 3121


are in positions covered by a pension, annu-ity, retirement, or similar fund or system es-tablished by a State or by a political subdi-vision thereof and individuals who are notin such positions, the organization shalldivide its employees into two separategroups. One group shall consist of all em-ployees who are in positions covered bysuch a fund or system and (i) are membersof such fund or system, or (ii) are not mem-bers of such fund or system but are eligibleto become members thereof; and the othergroup shall consist of all remaining employ-ees. An organization which has so dividedits employees into two groups may file acertificate pursuant to subparagraph (A)with respect to the employees in eithergroup, or may file a separate certificate pur-suant to such subparagraph with respect tothe employees in each group.

(F) If a certificate filed pursuant to thisparagraph is effective for one or more cal-endar quarters prior to the quarter in whichthe certificate is filed, then-

(i) for purposes of computing interestand for purposes of section 6651 (relatingto addition to tax for failure to file taxreturn or pay tax), the due date for thereturn and payment of the tax for suchprior calendar quarters resulting from thefiling of such certificate shall be the lastday of the calendar month following thecalendar quarter in which the certificateis filed; and

(ii) the statutory period for the assess-ment of such tax shall not expire beforethe expiration of 3 years from such duedate.

(2) Termination of waiver period by SecretaryIf the Secretary finds that any organization

which filed a certificate pursuant to this sub-section or the corresponding subsection ofprior law has failed to comply substantiallywith the requirements applicable with respectto the taxes imposed by this chapter or thecorresponding provisions of prior law or is nolonger able to comply with the requirementsapplicable with respect to the taxes imposedby this chapter, the Secretary shall give suchorganization not less than 60 days' advancenotice in writing that the period covered bysuch certificate will terminate at the end ofthe calendar quarter specified in such notice.Such notice of termination may be revokedby the Secretary by giving, prior to the closeof the calendar quarter specified in the not!ceof termination, written notice of such revoca-tion to the organization. No notice of termi-nation or of revocation thereof shall be givenunder this paragraph to an organization with-out the prior concurrence of the Secretary ofHealth, Education, and Welfare.(3) No renewal of waiver

In the event the period covered by a certifi-cate filed pursuant to this subsection or thecorresponding subsection of prior law is ter-minated by the organization, no certificatemay again be filed by such organization pur-suant to this subsection.

(4) Constructive filing of certificate where norefund or credit of taxes has been made(A) In any case where-

(i) an organization described in section501(c)(3) which is exempt from incometax under section 501(a) has not filed avalid waiver certificate under paragraph(1) of this subsection (or under the corre-sponding provision of prior law) as of thedate of the enactment of this paragraphor any subsequent date, but

(if) the taxes imposed by sections 3101and 3111 have been paid with respect tothe remuneration paid by such organiza-tion to its employees, as though such acertificate had been filed, during anyperiod (subject to subparagraph (B)(i)) ofnot less than three consecutive calendarquarters,

such organization shall be deemed (exceptas provided in subparagraph (B) of thisparagraph) for purposes of subsection(b)(8)(B) and section 210(a)(8)(B) of theSocial Security Act, to have filed a validwaiver certificate under paragraph (1) ofthis subsection (or under the correspondingprovision of prior law) on the first day ofthe period described in clause (i) of thissubparagraph effective on the first day ofthe calendar quarter in which such periodbegan, and to have accompanied such certi-ficate with a list containing the signature,address, and social security number (if any)of each employee with respect to whom thetaxes described in such subparagraph werepaid (and each such employee shall bedeemed for such purposes to have con-curred in the filing of the certificate).

(B) Subparagraph (A) shall not applywith respect to any organization if-

(i) the period referred to in clause (ii) ofsuch subparagraph (in the case of that or-ganization) terminated before the end ofthe earliest calendar quarter fallingwholly or partly within the time limita-tion (as defined in section 205(c)(1)(B) ofthe Social Security Act) immediately pre-ceding the date of the enactment of thisparagraph, or

(ii) a refund or credit of any part of thetaxes which were paid as described inclause (ii) of such subparagraph with re-spect to remuneration for services per-formed on or after the first day of theearliest calendar quarter falling wholly orpartly within the time limitation (as de-fined in section 205(c)(1)(B) of the SocialSecurity Act) immediately preceding thedate of enactment of this paragraph(other than a refund or credit whichwould have been allowed if a valid waivercertificate filed under paragraph (1) hadbeen in effect) has been obtained by theorganization or its employees prior to Sep-tember 9, 1976.

(5) Constructive filing of certificate where refundor credit has been made and new certificate isnot filed

In any case where-(A) an organization described in section

501(c)(3) which is exempt from income taxunder section 501(a) would be deemed

Page 848§ 3121


under paragraph (4) of this subsection tohave filed a valid waiver certificate underparagraph (1) if it were not excluded fromsuch paragraph (4) (pursuant to subpara-graph (B)(ii) thereof) because a refund orcredit of all or a part of the taxes describedin paragraph (4)(A)(ii) was obtained prior toSeptember 9, 1976; and

(B) such organization has not, prior to theexpiration of 180 days after the date of theenactment of this paragraph, filed a validwaiver certificate under paragraph (1)which is effective for a period beginning onor before the first day of the first calendarquarter with respect to which such refundor credit was made (or, if later, with thefirst day of the earliest calendar quarter forwhich such certificate may be in effectunder paragraph (1)(B)(iii)) and which isaccompanied by the list described in para-graph (1)(A),

such organization shall be deemed, for pur-poses of subsection (b)(8)(B) and section210(a)(8)(B) of the Social Security Act, tohave filed a valid waiver certificate underparagraph (1) of this subsection on the 181stday after the date of the enactment of thisparagraph, effective for the period beginningon the first day of the first calendar quarterwith respect to which the refund or credit re-ferred to in subparagraph (A) of this para-graph was made (or, if later, with the firstday of the earliest calendar quarter fallingwholly or partly within the time limitation(as defined in section 205(c)(1)(B) of theSocial Security Act) immediately precedingthe date of the enactment of this paragraph),and to have accompanied such certificatewith a list containing the signature, address,and social security number (if any) of eachemployee described in subparagraph (A) ofparagraph (4) including any employee withrespect to whom taxes were refunded or cred-ited as described in subparagraph (A) of thisparagraph (and each such employee shall bedeemed for such purposes to have concurredin the filing of the certificate). A certificatewhich is deemed to have been filed by an or-ganization on such 181st day shall supersedeany certificate which may have been actuallyfiled by such organization prior to that dayexcept to the extent prescribed by the Secre-tary.(6) Application of certain provisions to cases of

constructive filingAll of the provisions of this subsection

*(other than subparagraphs (B), (F), and (H)of paragraph (1)), including the provisions re-quiring payment of taxes under sections 3101and 3111 with respect to the services involved,shall apply with respect to any certificatewhich is deemed to have been filed by an or-ganization on any day under paragraph (4) or(5), in the same way they would apply if thecertificate had been actually filed on that dayunder paragraph (1); except that-

(A) the provisions relating to the filing ofsupplemental lists of concurring employeesin the third sentence of paragraph (1)(A),and in paragraph (1)(C), shall apply to theextent prescribed by the Secretary;

(B) the provisions of paragraph (1)(E)shall not apply unless the taxes described inparagraph (4)(A)(ii) were paid by the orga-nization as though a separate certificatehad been filed with respect to one or bothof the groups to which such provisionsrelate; and

(C) the action of the organization in ob-taining the refund or credit described inparagraph (5)(A) shall not be considered atermination of such organization's coverageperiod for purposes of paragraph (3). Anyorganization which is deemed to have fileda waiver certificate under paragraph (4) or(5) shall be considered for purposes of sec-tion 3102(b) to have been required to deductthe taxes imposed by section 3101 with re-spect to the services involved.

(7) Both employee and employer taxes payable byorganization for retroactive period in cases ofconstructive filing

Notwithstanding any other provision of thischapter, in any case where an organizationdescribed in paragraph (5)(A) has not filed avalid waiver certificate under paragraph (1)prior to the expiration of 180 days after thedate of the enactment of this paragraph andis accordingly deemed under paragraph (5) tohave filed such a certificate on the 181st dayafter such date, the taxes due under section3101, with respect to services constituting em-ployment by reason of such certificate forany period prior to the first day of the calen-dar quarter in which such 181st day occurs(along with the taxes due under section 3111with respect to such services and the amountof any interest paid in connection with therefund or credit described in paragraph(5)(A)) shall be paid by such organizationfrom its own funds and without any deduc-tion from the wages of the individuals whoperformed such services; and those individ-uals shall have no liability for the payment ofsuch taxes.

(8) Extending period for payment of taxes for ret-roactive coverage

Notwithstanding any other provision of thistitle, in any case where an organization de-scribed in paragraph (5)(A) files a validwaiver certificate under paragraph (1) by theend of the 180-day period following the dateof the enactment of this paragraph as de-scribed in paragraph (5)(B), or (not havingfiled such a certificate within that period) isdeemed under paragraph (5) to have filedsuch a certificate on the 181st day followingthat date, the taxes due under sections 3101and 3111 with respect to services constitutingemployment by reason of such certificate forany period prior to the first day of the calen-dar quarter in which the date of such filing orconstructive filing occurs may be paid in in-stallments over an appropriate period of time,as determined under regulations prescribedby the Secretary or his delegate, rather thanin a lump sum.

Page 849 § 3121


(l) Agreements entered into by domestic corporationswith respect to foreign subsidiaries

(1) Agreement with respect to certain employees offoreign subsidiaries

The Secretary shall, at the request of anydomestic corporation, enter into an agree-ment (in such form and manner as may beprescribed by the Secretary) with any suchcorporation which desires to have the insur-ance system established by title II of theSocial Security Act extended to service per-formed outside the United States in theemploy of any one or more of its foreign sub-sidiaries (as defined in paragraph (8)) by allemployees who are citizens of the UnitedStates, except that the agreement shall notbe applicable to any service performed by, orremuneration paid to, an employee if suchservice or remuneration would be excludedfrom the term "employment" or "wages", asdefined in this section, had the service beenperformed in the United States. Such agree-ment may be amended at any time so as to bemade applicable, in the same manner andunder the same conditions, with respect toany other foreign subsidiary of such domesticcorporation. Such agreement shall be applica-ble with respect to citizens of the UnitedStates who, on or after the effective date ofthe agreement, are employees of and performservices outside the United States for any for-eign subsidiary specified in the agreement.Such agreement shall provide-

(A) that the domestic corporation shallpay to the Secretary, at such time or timesas the Secretary may by regulations pre-scribe, amounts equivalent to the su.a ofthe taxes which would be imposed by sec-tions 3101 and 3111 (including amountsequivalent to the interest, additions to thetaxes, additional amounts, and penaltieswhich would be applicable) with respect tothe remuneration which would be wages ifthe services covered by the agreement con-stituted employment as defined in this sec-tion; and

(B) that the domestic corporation willcomply with such regulations relating topayments and reports as the Secretary mayprescribe to carry out the purposes of thissubsection.

(2) Effective period of agreementAn agreement entered into pursuant to

paragraph (1) shall be in effect for the periodbeginning with the first day of the calendarquarter in which such agreement is enteredinto or the first day of the succeeding calen-dar quarater, as may be specified in the agree-ment; except that in case such agreement isamended to include the services performedfor any other subsidiary and such amendmentis executed after the first month followingthe first calendar quarter for which theagreement is in effect, the agreement shall bein effect with respect to service performed forsuch other subsidiary only after the calendarquarter in which such amendment is execut-ed.

(3) Termination of period by a domestic corpora-tion

The period for which an agreement enteredinto pursuant to paragraph (1) of this subsec-tion is effective may be terminated with re-spect to any one or more of its foreign subsid-iaries by the domestic corporation, effectiveat the end of a calendar quarter, upon givingtwo years' advance notice in writing, but onlyif, at the time of the receipt of such notice,the agre3ment has been in effect for a periodof not less than eight years. The notice of ter-mination may be revoked by the domestic cor-poration by giving, prior to the close of thecalendar quarter specified in the notice of ter-mination, a written notice of such revocation.Notice of termination or revocation thereofshall be filed in such form and manner asmay be prescribed by regulations. Notwith-standing any other provision of this subsec-tion, the period for which any such agree-ment is effective with respect to any foreigncorporation shall terminate at the end of anycalendar quarter in which the foreign corpo-ration, at any time in such quarter, ceases tobe a foreign subsidiary as defined in para-graph (8).(4) Termination of period by Secretary

If the Secretary finds that any domesticcorporation which entered into an agreementpursuant to this subsection has failed tocomply substantially with the terms of suchagreement, the Secretary shall give such do-mestic corporation not less than sixty days'advance notice in writing that the period cov-ered by such agreement will terminate at theend of the calendar quarter specified in suchnotice. Such notice of termination may be re-voked by the Secretary by giving, prior to theclose of the calendar quarter specified in thenotice of termination, written notice of suchrevocation to the domestic corporation. Nonotice of termination or of revocation thereofshall be given under this paragraph to a do-mestic corporation without the prior concur-rence of the Secretary of Health, Education,and Welfare.(5) No renewal of agreement

If any agreement entered into pursuant toparagraph (1) of this subsection is terminatedin its entirety (A) by a notice of terminationfiled by the domestic corporation pursuant toparagraph (3), or (B) by a notice of termina-tion given by the Secretary pursuant to para-graph (4), the domestic corporation may notagain enter into an agreement pursuant toparagraph (1). If any such agreement is ter-minated with respect to any foreign subsid-iary, such agreement may not thereafter beamended so as again to make it applicablewith respect to such subsidiary.(6) Deposits in trust funds

For purposes of section 201 of the Social Se-curity Act, relating to appropriations to theFederal Old-Age and Survivors InsuranceTrust Fund and the Federal Disability Insur-ance Trust Fund, such remuneration-

(A) paid for services covered by an agree-ment entered into pursuant to paragraph(1) as would be wages if the services consti-tuted employment, and

§ 3121 Page 850


(B) as is reported to the Secretary pursu-ant to the provisions of such agreement orof the regulations issued under this subsec-tion,

shall be considered wages subject to the taxesimposed by this chapter.(7) Overpaymenth and underpayments

(A) If more or less than the correctamount due under an agreement enteredinto pursuant to this subsection is paid withrespect to any payment of remuneration,proper adjustments with respect to theamounts due under such agreement shall bemade, without interest, in such manner andat such times as may be required by regula-tions prescribed by the Secretary.

(B) If an overpayment cannot be adjustedunder subparagraph (A), the amount there-of shall be paid by the Secretary or his dele-gate, through the Fiscal Service of theTreasury Department, but only if a claimfor such overpayment is filed with the Sec-retary within two years from the time suchoverpayment was made.

(8) Definition of foreign subsidiaryFor purposes of this subsection and section

210(a) of the Social Security Act, a foreignsubsidiary of a domestic corporation is-

(A) a foreign corporation not less than 20percent of the voting stock of which isowned by such domestic corporation; or

(B) a foreign corporation more than 50percent of the voting stock of which isowned by the foreign corporation describedin subparagraph (A).

(9) Domestic corporation as separate entityEach domestic corporation which enters

into an agreement pursuant to paragraph (1)of this subsection shall, for purposes of thissubsection and section 6413(c)(2)(C), relatingto special refunds in the case of employees ofcertain foreign corporations, be considered anemployer in its capacity as a party to suchagreement separate and distinct from its iden-tity as a person employing individuals on itsown account.(10) Regulations

Regulations of the Secretary to carry outthe purposes of this subsection shall be de-signed to make the requirements Imposed ondomestic corporations with respect to servicescovered by an agreement entered into pursu-ant to this subsection the same, so far aspracticable, as those Imposed upon employerspursuant to this title with respect to thetaxes imposed by this chapter.

(W) Service In the uniformed servicesFor purposes of this chapter-(1) Inclusion of service

The term "employment" shall, notwith-standing the provisions of subsection (b) ofthis section, include service performed by anindividual as a member of a uniformed serviceon active duty; but such term shall not in-clude any such service which is performedwhile on leave without pay.(2) Active duty

The term "active duty" means "active duty"as described in section 102 of the Service-

men's and Veterans' Survivor Benefits Act,except that it shall also include "active dutyfor training" as described in such section.(3) Inactive duty training

The term "inactive duty training" means"inactive duty training" as described in suchsection 102.

(n) Member of a uniformed serviceFor purposes of this chapter, the term

"member of a uniformed service" means anyperson appointed, enlisted, or inducted in acomponent of the Army, Navy, Air Force,Marine Corps, or Coast Guard (including a re-serve component of a uniformed service as de-fined in section 102(3) of the Servicemen's andVeterans' Survivor Benefits Act), or in one ofthose services without specification of compo-nent, or as a commissioned officer of the Coastand Geodetic Survey or the Regular or ReserveCorps of the Public Health Service, and anyperson serving in the Army or Air Force undercall or conscription. The term includes-

(1) a retired member of any of those ser-vices;

(2) a member of the Fleet Reserve or FleetMarine Corps Reserve;

(3) a cadet at the United States MilitaryAcademy, a midshipman at the United StatesNaval Academy, and a cadet at the UnitedStates Coast Guard Academy or UnitedStates Air Force Academy;

(4) a member of the Reserve Officers'Training Corps, the Naval Reserve Officers'Training Corps, or the Air Force Reserve Of-ficers' Training Corps, when ordered toannual training duty for fourteen days ormore, and while performing authorized travelto and from that duty; and

(5) any person while en route to or from, orat, a place for final acceptance or for entryupon active duty in the military or naval ser-vice-

(A) who has been provisionally acceptedfor such duty; or

(B) who, under the Universal MilitaryTraining and Service Act, has been seledtedfor active military or naval service;

and has been ordered or directed to proceedto such place.

The term does not include a temporary memberof the Coast Guard Reserve.(o) Crew leader

For purposes of this chapter, the term "crewleader" means an individual who furnishes indi-viduals to perform agricultural labor for an-other person, if such individual pays (either onhis own behalf or on behalf of such person) theindividuals so furnished by him for the agricul-tural labor performed by them and if such indi-vidual has not entered into a written agreementwith such person whereby such individual hasbeen designated as an employee of such person;and such individuals furnished by the crewleader to perform agricultural labor for anotherperson shall be deemed to be the employees ofsuch crew leader. For purposes of this chapterand chapter 2, a crew leader shall, with respectto service performed in furnishing individualsto perform agricultural labor for anotherperson and service performed as a member of

Page 851 § 3121


the crew, be deemed not to be an employee ofsuch other person.(p) Peace Corps volunteer service

For purposes of this chapter, the term "em-ployment" shall, notwithstanding the provi-sions of subsection (b) of this section, includeservice performed by an individual as a volun-teer or volunteer leader within the meaning ofthe Peace Corps Act.(q) Tips included for employee taxes

For purposes of this chapter other than forpurposes of the taxes imposed by section 3111,tips received by an employee in the course ofhis employment shall be considered remunera-tion for employment. Such remuneration shallbe deemed to be paid at the time a writtenstatement including such tips is furnished tothe employer pursuant to section 6053(a) or (ifno statement including such tips is so fur-nished) at the time received.(r) Election of coverage of religious orders(1) Certificate of election by order

A religious order whose members are re-quired to take a vow of poverty, or anyautonomous subdivision of such order, mayfile a certificate (in such form and manner,and with such official, as may be prescribedby regulations under this chapter) electing tohave the insurance system established by titleII of the Social Security Act extended to ser-vices performed by its members in the exer-cise of duties required by such order or suchsubdivision thereof. Such certificate of elec-tion shall provide that-

(A) such election of coverage by suchorder or subdivision shall be irrevocable;

(B) such election shall apply to all currentan I future members of such order, or in thecase of a subdivision thereof to all currentand future members of such order whobelong to such subdivision;

(C) all services performed by a member ofsuch an order or subdivision in the exerciseof duties required by such order or subdivi-sion shall be deemed to have been per-formed by such member as an employee ofsuch order or subdivision; and

(D) the wages of each member, uponwhich such order or subdivision shall paythe taxes imposed by sections 3101 and3111, will be determined as provided in sub-section (i)(4).

(2) Definition of memberFor purposes of this subsection, a member

of a religious order means any individual whois subject to a vow of poverty as a member ofsuch order and who performs tasks usuallyrequired (and to the extent usually required)of an active member of such order and who isnot considered retired because of old age ototal disability.(3) Effective date for election

(A) A certificate of election of coverageshall be in effect, for purposes of subsection(b)(8)(A) and for purposes of section210(a)(8)(A) of the Social Security Act forthe period beginning with whichever of thefollowing may be designated by the order orsubdivision thereof:

(i) the first day of the calendar quarterin which the certificate is filed,

(ii) the first day of the calendar quartersucceeding such quarter, or

(iII) the first day of any calendar quar-ter preceding the calendar quarter inwhich the certificate is filed, except thatsuch date may not be earlier than thefirst day of the twentieth calendar quar-ter preceding the quarter in which suchcertificate is filed.

Whenever a date is designated under clause(iii), the election shall apply to services per-formed before the quarter in which the cer-tificate is filed only if the member perform-ing such services was a member at the timesuch services were performed and is livingon the first day of the quarter in whichsuch certificate is filed.

(B) If a certificate of election filed pursu-ant to this subsection is effective for one ormore calendar quarters prior to the quarterin which such certificate is filed, then-

(i) for purposes of computing Interestand for purposes of section 6651 (relatingto addition to tax for failure to file taxreturn), the due date for the return andpayment of the tax for such prior calen-dar quarters resulting from the filing ofsuch certificate shall be the last day ofthe calendar month following the calen-dar quarter in which the certificate isfiled; and

(ii) the statutory period for the assess-ment of such tax shall not expire beforethe expiration of 3 years from such duedate.

(4) Coordination with coverage of lay employeesNotwithstanding the preceding provisions

of this subsection, no certificate of electionshall become effective with respect to anorder or subdivision thereof, unless-

(A) if at the time the certificate of elec-tion is filed a certificate of waiver of exemp-tion under subsection (k) is in effect withrespect to such order or subdivision, suchorder or subdivision amends such certificateof waiver of exemption (in such form andmanner as may be prescribed by regulationsmade under this chapter) to provide that itmay not be revoked, or

(B) If at the time the certificate of elec-tion is filed a certificate of waiver of exemp-tion under such subsection is not in effectwith respect to such order or subdivision,such order or subdivision files such certifi-cate of waiver of exemption under the pro-visions of such subsection except that suchcertificate of waiver of exemption cannotbecome effective at a later date than thecertificate of election and such certificate ofwaiver of exemption must specify that suchcertificate of waiver of exemption may notbe revoked. The certificate of waiver of ex-emption required under this subparagraphshall be filed notwithstanding the provi-sions of subsection (k)(3).

(Aug. 16, 1954, ch. 736, 68A Stat. 417; Sept. 1,1954, ch. 1206, title II, §§ 204(a), (b), 205(a)-(e),206(a), 207, 209, 68 Stat. 1091-1094; Aug. 1,1956. ch. 836, title I, §§ 103(J), 121(d), title II,

§ 3121 Page 852


§§ 201(b)-(d), (e)(1), (h)(1), (2), (J)-(l), 70 Stat.824, 839-841, 843; Aug. 1, 1956, ch. 837, title IV,§§ 410, 411(a), 70 Stat. 878; Aug. 28, 1958, Pub.L. 85-840, title IV, §§ 402(b), 404(a), 405(a), (b),72 Stat. 1042, 1044-1046; Sept. 2, 1958, Pub. L.85-866, title I, § 69, 72 Stat. 1659; June 25, 1959,Pub. L. 86-70, § 22(a), 73 Stat. 146; Aug. 18,1959, Pub. L. 86-168, title I, § 104(h), title II,§ 202(a), 73 Stat. 387, 389; July 12, 1960, Pub. L.86-624, § 18(c), 74 Stat. 416; Sept. 13, 1960, Pub.L. 86-778, title I, §§ 103(n)-(p), 104(b), 105(a), 74Stat. 938, 939, 942; Sept. 21, 1961, Pub. L. 87-256, § 110(e)(1), 75 Stat. 536; Sept. 22, 1961, Pub.L. 87-293, title II, § 202(a)(1), (2), 75 Stat. 626;Feb. 26, 1964, Pub. L. 88-272, title II, § 220(c)(2),78 Stat. 62; Oct. 13, 1964, Pub. L. 88-650, § 4(b),78 Stat. 1077; July 30, 1965, Pub. L. 89-97, titleIII, §§ 311(b)(4), (5), 313(c)(3), (4), 316(a)(1), (b),317(b), 320(b)(2), 79 Stat. 381, 383, 386, 388, 393;Jan. 2, 1968, Pub. L. 90-248, title I, §§ 108(b),123(b), title IV, § 403(i), title V, § 504(a), 81 Stat.835, 845, 932, 934; Dec. 30, 1969, Pub. L. 91-172,title IX, § 943(c)(1)-(3), 83 Stat. 728; Mar. 17,1971, Pub. L. 92-5, title II, § 203(b)(2), 85 Stat.11; July 1, 1972, Pub. L. 92-336, title II,§ 203(b)(2), 86 Stat. 419; Oct. 30, 1972, Pub. L.92-603, title I, §§ 104(i), 122(b), 123(a)(2), (b),(c)(2), 128(b), 129(a)(2), 138(b), 86 Stat. 1341,1354, 1356, 1358, 1359, 1365; July 9, 1973, Pub.L. 93-66, title II, § 203(b)(2), (d), 87 Stat. 153;Dec. 31, 1973, Pub. L. 93-233, §5(b)(2), (d), 87Stat. 954; Oct. 4, 1976, Pub. L. 94-455, title XII,§ 1207(e)(1)(A), title XIX, §§ 1903(a)(3).1906(b)(13)(A), (C), 90 Stat. 1706, 1806, 1807,1834; Oct. 19, 1976, Pub. L. 94-563, § 1(b), (c), 90Stat. 2655.)

REFERENCES IN TEXT

The Social Security Act, referred to in subsecs.(a)(1), (15), (b)il0)(B)(Ii), 0J)(2)(D), (4)(B), (k)(1)iA) to(C),. (4)(A), (B), (5), (1)(1), (6), (8), (r)i3)(A), is act Aug.14, 1935, ch. 531, 49 Stat. 620, as amended. Title II ofthe Social Security Act is classified generally to sub-chapter II (§ 401 et seq.) of chapter 7 of Title 42, ThePublic Health and Welfare. Sections 201, 205, 210, 218,223, and 230 of the Social Security Act enacted sec-tions 401, 405, 410, 418, 423, and 430. respectively, ofTitle 42. For complete classification of this Act to theCode, see section 1305 of Title 42 and Tables volume.

The Agricultural Act of 1949, as amended, referredto in subsec. (b)(1), is act Oct. 31, 1949, ch. 792, 63Stat. 1051, as amended. Title V of the Agricultural Actof 1949 was classified principally to subchapter IV(§ 1461 et seq.) of chapter 35A of Title 7, Agriculture.For complete classification of this Act to the Code, seeShort Title note set out under section 1421 of Title 7and Tables volume.

Section 1410 of the Internal Revenue Code of 1039,referred to in subsec. (b)(6)(B), was classified to sec-tion 1410 of former Title 26, Internal Revenue Code.Section 1410 was repealed by section 7851(a)(3) of thistitle. For table of comparisons of the 1939 Code to the1954 Code, see Table I preceding section 1 of this title.See, also, section 7851(e) of this title for provision thatreferences in the 1954 Code to a provision of the 1939Code, not then applicable, shall be deemed a referenceto the corresponding provision of the 1954 Code,which is then applicable.

The Internal Security Act of 1950, referred to insubsec. (b)(17), is act Sept. 23, 1950, ch. 1024, 64 Stat.987, as amended, which is classified principally tochapter 23 (§ 781 et seq.) of Title 50, War and NationalDefense. For complete classification of this Act to theCode, see Short Title note set out under section 781 ofTitle 50 and Tables volume.

Section 101(a)(15) of the Immigration and National-ity Act, referred to in subsec. (b)(18), (19), is classified

to section 1101(a)(15) of Title 8, Aliens and National.ity.

Section 15(g) of the Agricultural Marketing Act, re-ferred to in subsec. (g)(3), is classified to section 1141jof Title 12, Banks and Banking.

The Servicemen's and Veterans' Survivor BenefitsAct, referred to in subsecs. (i)(2), (m)(2), (n), is actAug. 1, 1956, ch, 837, 70 Stat. 857. For complete classi-fication of this Act and section 102 of this Act to theCode, see Tables volume.

The Peace Corps Act, referred to in subsecs. (i)(3),(p), is Pub. L. 87-293, title I, Sept. 22, 1961, 75 Stat.612, as amended, which is classified principally tochapter 34 § 2501 et seq.) of Title 22, Foreign Rela-tions and Intercourse. Sections 5 and 6 of the PeaceCorps Act are classified to sections 2504 and 2505 ofTitle 22. For complete classification of this Act to theCode, see Short Title note set out under section 2501of Title 22 and Tables volume.

Chapter 9 of the Internal Revenue Code of 1939, re-ferred to in subsec. (j)(4)(B), was comprised of sections1400 to 1636 of former Title 26, Internal RevenueCode. For table of comparisons of the 1939 Code tothe 1954 Code, see Table I preceeding section 1 of thistitle. See also section 7851(a)(3) of this title for appli-cability of chapter 9 of former title 26. See also section7851(e) of this title for provision that references in the1954 Code to a peovision of the 1939 Code, not thenapplicable, shall be deemed a reference to the corre-sponding provision of the 1954 Code, which is then ap-plicable.

The date of enactment of this paragraph, referred toin subsec. (k)(4), (5), (7) and (8), probably means thedate of enactment of Pub. L. 94-563, which was en-acted Oct. 19, 1976.

The Universal Military Training and Service Act, re-ferred to in subsec. (n)(5)(B). renamed the "MilitarySelective Service Act of 1967", by Pub. L. 90-40, § ED,June 30, 1967, 81 Stat. 100, is act June 24, 1948, ch.625, 62 Stat. 604, which is classified principally to sec-tion 451 et seq. of Title 50 App., War and National De-fense. For complete classification of this Act to theCode, see References in Text note set out under sec-tion 451 of Title 50 App. and Tables volume.

AMENDMENTS

1976-Subsec. (b). Pub. L. 94-455, § 1903(a)(3)(A),substituted in introductory material ", of whatevernature, performed" for "performed after 1936 andprior to 1955 which was employment for purposes ofsubchapter A of chapter 9 of the Internal RevenueCode of 1939 under the law applicable to the period inwhich such service was performed, and any service, ofwhatever nature, performed after 1954."

Subsec. (b)(1). Pub. L. 94-455, § 1903(a)(3)(B), struckout "65 Stat. 119;" before "7 U.S.C. 1461-1468".

Subsec. (b)(6)(B)(v). Pub. L. 94-455, § 1903(a)(3)(C),substituted "Secretary of Transportation" for "Secre-tary of the Treasury".

Subsec. (b)(8)(B). Pub. L. 94-563, § l(b), inserted "ordeemed to have been so filed under paragraph (4) or(5) of such subsection" following "filed pursuant tosubsection (k) (or the corresponding subsection ofprior law) in the provisions preceding cl. (i), inserted"(or deemed to have been filed)" following "filed" incls. (I), (ii), and (iii), and substituted "is (or is deemedto be) in effect" for "is in effect" in the provisions fol-lowing cl. (iII).

Subsec. (b)(12)(B). Pub. L. 94-455, § 1906(b)(13)(C),substituted "to the Secretary of the Treasury" for "tothe Secretary".

Subsec. (b)(20). Pub. L. 94-455, § 1207(e)(1)(A), addedsubsec. (b)(20).

Subsec. (g)(3). Pub. L. 94-455, § 1903(a)(3)(D), struckout "46 Stat. 1550, § 3;" before "12 U.S.C. 1141J".

Subsec. (k)(1). Pub. L. 94-455, § 1903(a)(3)(E), rede-signated former subpar. (G) as (F). Former subpars.(F) and (H), which related to the right of an organiza-tion to request before 1960 to have a certificate effec-tive where such certificate was filed after 1955 butprior to the enactment of this subparagraph and the

71-999 0 - '78 - 56 (Vol. 7)

Page 853 § 3121


right of an organization to amend a certificate filedbefore 1966 to make such certificate effective for anearlier date than had been originally established, re-spectively, were struck out.

Subsecs. (k)(2). Pub. L. 94-455, § 1906(b)(13)(A),struck out "or his delegate" following "Secretary"each time appearing.

Subsecs. (k)(4) to (8). Pub. L. 94-563, § 1(c), addedsubsecs. (k)(4) to (8). Pub. L. 94455, f 1906(b)(13)(A),struck out "or his delegate" following "Secretary"each time appearing.

Subsec. (1)(1). Pub. L. 94455. § 1906(b)(13)(A), struckout "or his delegate" following "Secretary".

Subsec. (l)(2). Pub. L. 94455, § 1903(a)(3)(F), struckout ", but in no case prior to January 1. 1955" follow-Ing "specified in the agreement".

Subsecs. (1)(4) to (7), (10). Pub. L. 94455,§ 1906(b)(13)(a), struck out "or his delegate" following"Secretary" each time appearing.

Subsec. (m)(1). Pub. L. 94455, § 1903(a)(3)(G).struck out "after December 1956" following "includeservice performed".

1973-Subsec. (a)(1). Pub. L. 93-233, § 5(b)(2), effec.tive with respect to remuneration paid after 1973, sub-stituted "$13,200" for "$12,600" in two places.

Pub. L. 93-233, § 5(d), applicable only with respect toremuneration paid after, 1973 (as provided in section5(e) of Pub. L. 93-233, set out as a note under section409 of TItle 42), amended section 203(b)(2)(C) of thePub. L. 92-336 (set out as 1973 Amendment note here.under) substituting "$13,200" for "$12,600".

Pub. L. 93-66, § 203(b)(2), effective with respect toremuneration paid after 1973, substituted "$12,600"ior "$12,000" in two places.

Pub. L. 93-66, § 203(d). applicable only with respectto remuneration paid after, and taxable years begin-ning after, 1973 (as provided in section 203(e) of Pub.L. 93-66, set out as a note under section 409 of Title42), amended section 203(b)(2)(C) of Pub. L 92-336(set out as 1972 Amendment note hereunder) substi-tuting "$12,600" for "$12,000".

1972--Subsec. (a)(1). Pub. L 92-336, § 203(b)(2)(A),substituted "$10,800" for "$9,000" in two places.

Pub. L. 92-336, § 203(b)(2)(B), effective with respectto remuneration paid after 1973, substituted "$12,000"for "$10,800" in two places.

Pub. L. 92-336, § 203(b)(2)(C), effective with respectto remuneration paid after 1974, substituted "the con-tribution and benefit base (as determined under sec-tion 230 of the Social Security Act)" for "$12,000" intwo places, and "the calendar year with respect towhich such contribution and benefit base is effective"for "any calendar year".

Subsec. (a)(9). Pub. L. 92-603, § 104(i), substituteduniform provision of 62 years of age, for separate pro.visions for men and women of 65 and 62 years, respec-tively.

Subsec. (a)(14). Pub. L. 92-603, § 122(b), added par.(14).

Subsec. (a)(15). Pub. L. 92-603, § 138(b), added par.(15).

Subsec. (b)(7)(D). Pub. L. 92-603, § 128(b), addedsubpar. (D).

Subsec. (b)(8)(A). Pub. L. 92-603, § 123(a)(2). addedprovision that this subparagraph shall not apply toservice performed by a member of such religious orderin the exercise of such duties if an election of coverageunder subsec. (r) is in effect with respebt to suchorder, or with respect to the autonomous subdivisionthereof to which such member belongs.

Subsec. (b)(10)(B). Pub. L. 92-603, § 129(a)(2), addedprovisions relating to service performed in the employof organizations described in section 509(a)(3) of thistitle.

Subsec. (i)(4). Pub. L. 92-603, § 123(c)(2), added par.(4).

Subsec. (r). Pub. L. 92-603, § 123(b), added subsec.(r).

1971-Subsec. (a)(1). Pub. L. 92-5 substituted"$9,000" for "$7,800" in two places.

1969-Subsec. (k)(1)(F)(i). Pub. L. 91-172, § 943(c)(1),added "or pay tax" after "tax return".

Subsec. (k)(1)(G)(i). Pub. L. 91-172, § 943(c)(2),added "or pay tax" after "tax return".

Subsec. (k)(1)(H)(i). Pub. L. 91-172, §943(c)(3),added "or pay tax" after "tax return".

1968-Subsec. (a)(1). Pub. L. 90-248, § 108(b)(a), sub-stituted "$7,800" for "$6,600" wherever appearing.

Subsec. (a)(13). Pub. L. 90-248, §504(a), added par.(13).

Subsec. (b)(3)(B). Pub. L. 90-248, § 123(b), providedfor inclusion of family employment in a private homein definition of "employment," upon compliance withconditions described in cls. (i) to (iii).

Subsec. (b)(6)(C)(li). Pub. L. 90-248, § 403(1)(1), sub-stituted "section 5351(2) of title 5, United StatesCode" for "section 2 of the Act of August 4, 1967" andstruck out "; 5 U.S.C.. sec. 1052" at end of text withinparentheses.

Subsec. (b)(6)(C)(vi). Pub. L. 90-248, § 403(i)(2), sub-stituted "subchapter III of chapter 83 of title 5,United States Code," for "the Civil Service RetirementAct".

Subsec. (b)(7)(C)(ii). Pub. L. 90-248. § 403(i)(3), sub-stituted "section 5351(2) of title 5, United StatesCode" for "section 2 of the Act of August 4, 1947" andstruck out "; 5 U.S.C. 1052" at end of text within pa.rentheses.

1965-Subsec. (a)(1). Pub. L. 89-97, § 320(b)(2), sub-stituted "$6,600" for "$4,800" wherever appearing,

Subsec. (a)(12). Pub. L. 89-97. § 313(c)(3), added par.(12).

Subsec. (b)(6)(C)(lv). Pub. L. 89-97. § 311(b)(4), in-serted ", other than as a medical or dental intern or amedical or dental resident in training".

Subsec. (b)(7)(C). Pub. L. 89-97, § 317(b)(3), addedsubpar. (C).

Subsec. (b)(13). Pub. L. 89-97, §311(b)(5), struck outfrom the definition of employment the exclusion ofservice performed as an intern in the employ of a hos-pital by an individual who has completed a 4 years'course in a medical school chartered or approved pur-suant to State law.

Subsec. (k)(1)(B)(iii). Pub. L. 89-97, §316(a)(1), sub.stituted "such date may not be earlier than the firstday of the twentieth" for ", in the case of a certificatefiled prior to January 1, 1960, such date may not beearlier than January 1, 1956, and in the case of a certi-ficate filed after 1959, such date may not be earlierthan the first day of the fourth".

Subsec. (k)(1)(H). Pub. L. 89-97, § 316(b), addedsubpar. (H).

Subsec. (q). Pub. L. 89-97. § 313(c)(4), added subsec.(q).

1964-Subsec. (a). Pub. L. 88-650 added par. (11).Pub. L. 88-272 substituted "is a plan described in sec-

tion 403(a), or" for "meets the requirements of section401(a)(3), (4), (5), and (6)" in subpar. (5)(B), and addedsubpar. (5)(C).

1961-Subsec. (b)(19). Pub. L. 87-256 added subsec.(b)(19).

Subsec. (i)(3). Pub. L. 87-293. § 202(a)(1), addedsubsec. (1)(3).

Subsec. (p). Pub. L. 87-293, § 202(a)(2), added subsec.(p).

1960-Subsec. (b)(3). Pub. L. 86-778, § 104(b), desig-nated existing provisions as cl. (A) and eliminatedtherein provisions which related to service performedby an individual in the employ of his son or daughter,and added cl. (B).

Subsec. (b)(7). Pub. L. 86-778, § 103(n), excluded ser-vice in the employ of the Government of Guam or theGovernment of American Samoa or any political sub-division thereof, or of any instrumentality of any oneor more of the foregoing which is wholly owned there-by.

Subsec. (b)(18). Pub. L. 86-778, § 103(o) added subsec.(b)(18).

Subsec. (e). Pub. L 86-778, § 103(p), eliminated a ref-erence to Hawaii in cl. (1), and included Guam andAmerican Samoa and cls. (1) and (2).

Pub. L. 86-624 eliminated "Hawaii," preceding "theDistrict of Columbia", in cl. (1).

Page 854§ 3121


Subsec. (k)(1)(A). Pub. L. 86-778, § 105(a)(1), (2),eliminated words "and that at least two-thirds of itsemployees concur in the filing of the certificate" fol-lowing "extended to service performed by its employ-ees", and substituted "of each employee (if any) whoconcurs" for "of each employee who concurs".

Subsec. (k)(1)(E). Pub. L. 86-778, § 105(a)(3), substi-tuted "in either group, or may file a separate certifi-cate pursuant to such subparagraph with respect tothe employees in each group" for "in one of thegroups if at least two-thirds of the employees in suchgroup concur in the filing of the certificate, The orga-nization may also file such a certificate with respect tothe employees in the other group if at least two-thirdsof the employees in such other group concur in thefiling of such certificate."

1959-Subsec. (b)(6)(B)(i). Pub. L. 86-168 substitut-ed "Federal land bank association" for "national farmloan association", and included service in the employof Federal land banks, Federal intermediate creditbanks and banks for cooperatives.

Subsec. (e). Pub. L. 86-70 eliminated "Alaska." pre-ceding "Hawaii".

1958-Subsec. (a)(1). Pub. L. 85-840, §402(b). substi-tuted "$4,800" for "$4,200" wherever appearing.

Subsec. (b)(1). Pub. L. 85-840, § 404(a), eliminatedprovisions which excluded from the definition of "em-ployment" service performed in connection with theproduction or harvesting of any commodity defined asan agricultural commodity in section 1141j of title 12.

Subsec. (b)(8)(B). Pub. L. 85-840, § 405(b), made sub-paragraph inapplicable to service performed duringthe period for which a certificate is in effect if suchservice is performed by an employee who, after thecalendar quarter in which the certificate was filedwith respect to a group described in section321(k)(1)(E) of this title, became a member of suchgroup, and made subparagraph applicable with respectto service performed by an employee as a member of agroup described in section 3121(k)(1)(E) of this titlewith respect to which no certificate is in effect.

Subsec. (k)(1). Pub. L. 85-840, § 405(a), permittedamendment of the list at any time prior to the expira-tion of the twenty-fourth month following the calen-dar quarter in which the certificate is filed, allowed anorganization to provide that the certificate shall be ineffect for the period beginning with the first day ofany calendar quarter preceding the calendar quarterin which the certificate is filed, except that, in thecase of a certificate filed prior to Jan. 1, 1960, suchdate may not be earlier than Jan. 1, 1956, and in thecase of a certificate filed after 1959. such date may notbe earlier than the first day of the fourth calendarquarter preceding the quarter in which such certifi-cate is first made the certificate effective in the caseof services performed by an employee whose name ap-pears on a supplemental list only with respect to ser-vice performed by the employee for the period begin-ning with the first day of the calendar quarter inwhich the supplemental list is filed, required organiza-tions described in subpar. (A) which employ both indi-viduals who are in positions covered by a pension, an-nuity, retirement, or similar fund or system estab-lished by a State or political subdivision thereof andindividuals who are not in such positions, to dividetheir employees into two separate groups, authorizedthe filing of requests by organizations which filed cer-tificates after 1955 but prior to Aug. 28, 1958, to havesuch certificates effective, with respect to services ofcertain individuals, for the period beginning with thefirst day of any calendar quarter preceding the firstcalendar quarter for which they are effective and fol-lowing the last calendar quarter of 1955, and providedfor the due date and payment of tax for certain calen-dar quarters and for the expiration of the statutoryperiod of assessment.

Subsec. (l)(3). Pub. L. 85-866 substituted "by" for"be" in the catchline.

1956-Subsec. (a)(8)(B). Act Aug. 1, 1956, ch. 836,§201(h)(1), included within the definition of wagescash remuneration of $150 or more, and cash remu-

neration computed on a time basis where the employ.ee performs agricultural labor for the employer on 20days or more during the calendar year.

Subsec. (a)(9). Act Aug. 1, 1956, ch. 836, § 201(b), ex-cluded payments made to a woman after she attainsthe age of 62.

Subsec. (b)(1)(B). Act Aug. 1, 1956, cl. 836, § 201(c),excepted from the term "employment" services per-formed by foreign agricultural workers lawfully ad-mitted from any foreign country or possession thereof,on a temporary basis to perform agricultural labor.

Subsee. (b)(6)(B)(l). Act Aug. 1, 1956, ch. 836,§ 201(d)(1), included service performed in the employof a Federal Home Loan Bank.

Subsee. (b)(6)(C)(vi). Act Aug. 1, 1956, ch. 836,§ 201(d)(2), substituted "Civil Service Retirement Act"for "Civil Service Retirement Act of 1930", and insert-ed "(other than the retirement system of the Tennes-see Valley Authority)" following "retirement system".

Subsec. (b)(16), (17). Act Aug. 1, 1956, ch. 836,§§ 201(e)l(), and 121d, added subsecs. (b)(16), (17), re-spectively.

Subsec. (i). Act Aug. 1. 1956, ch. 837, § 410, designat-ed existing provisions as par. (1) and added par. (2).

Subsec (k)(1). Act Aug. 1, 1956, ch. 836, § 201(k), (1),inserted "or at any time prior to January 1, 1959,whichever is the later" following "the certificate is ineffect", and substituted "the first day of the calendarquarter in which such certificate is filed or the firstday of the succeeding calendar quarter, as may bespecified in the certificate," for "the first day follow-ing the close of the calendar quarter in which suchcertificate is filed".

Subsec. (1)(6). Act Aug. 1, 1956, ch. 836, § 103(J). in-serted reference to the Federal Disability InsuranceTrust Fund.

Subsec. (1)(8)(A). Act Aug. 1, 1956, ch. 836, § 201(j),substituted "not less than 20 percent" for "more than50 percent".

Subsecs. (m) and (n). Act Aug. 1. 1956, ch. 837,§ 411(a), added subsecs. (m) and (n).

Subsec. (W). Act Aug. 1, 1956, ch. 836, § 201(h)(2),added subsec. ().

1954-Subsec. (a)(1). Act Sept. 1, 1954, § 204(a), sub-stituted "$4,200" for "$3,600" wherever appearing.

Subsec. (a)(7)(B). Act Sept. 1, 1954, § 204(b)(1), madecoverage of domestic service dependent solely on re-ceipt of $50 in cash wages in a calendar quarter by anemployee from an employer for such service.

Subsec. (a)(7)(C). Act Sept. 1, 1954, § 204(b)(2),added subsec. (a)(7)(C).

Subsec. (a)(8). Act Sept. 1. 1954, § 204(b)(3), designat-ed existing provisions as subpar. (A) and added subpar.(B).

Subsec. (b)(3). Act Sept. 1, 1954, § 205(b) deleted par.(3) and redesignated pars. (4) L, (14) as (3) to (13), re-spectively.

Subsec. (b)(4). Act Sept. 1, 1954, § 205(c), amendedsubsec. (b)(4), as redesignated, to make the exceptionwith respect to services on non-American vessels oraircraft applicable only if the individual is not aUnited States citizen or the employer is not an Ameri-can employer.

Subsec. (b)(6)(B). Act Sept. 1, 1954, § 205(d)(1)(A),amended subsec. (b)(6), as redesignated, by insertingin subpar. (B) "by an individual" after "service is per-foimed" and "and if such service is covered by a retire.ment system established by such instrumentality"after "December 31, 1950".

Subsec. (b)(8)(B)(v). Act Sept. 1. 1954, § 205(d)(1)(B),amended subsec. (b)(6), as redesignated, by addingclause (v) to subpar. (b).

Subsec. (b)(6)(C). Act Sept. 1, 1954, § 205(d)(2), de-leted the exception from coverage for services in thefollowing categories: temporary employees in the PostOffice Department field service; temporary censustaking employees of the Bureau of the Census; Feder-al employees paid on a contract or fee basis; Federalemployees receiving compensation of $12 a year orless; certain consular agents; individuals employedunder Federal unemployment relief programs; and

Page 855 § 3121


members of State, county, or community committeesunder the Commodity Stabilization Service and simi-lar bodies, unless such bodies are composed exclusivelyof full-time Federal employees, and limited the exclu-sion of inmates or patients of United States institu-tions to inmates of penal institutions.

Subsec. (b)(15). Act Sept. 1, 1954, § 205(e). deletedpar. (15) and redesignated pars. (16) and (17) as (14)and (15), respectively.

Subsec. (c). Act Sept. 1, 1954, § 205(b), substituted"subsection (b)(9)" for "subsection (b)(10)".

Subsec. (d)(3)(C). Act Sept. 1, 1954, § 206(a), elimi-nated the requirement that the performance of theservices of homeworkers be subject to State licensingrequirements.

Subsec. (k)(1). Act Sept. 1, 1954, § 207, provided thatthe list accompanying any certificate filed by a non-profit organization with respect to its lay employeesmay be amended only within a period of two yearsafter the certificate takes effect and provided that asupplemental list filed after the first month followingthe first calendar quarter for which the certificate isin effect shall be in effect only as to those services per-formed by an individual on the list which are per-formed by him after the calendar quarter in which thesupplemental list is filed.

Subsec. (1). Act Sept, 1, 1954, § 209, added subsec. (1),

EFFECTlVE DATE OF 1976 AMENm wTr

Section l(d) of Pub. L. 94-563 provided that: "Theamendments made by this section [amending subsec.(b)(8)(B) of this section and section 410(a)(8)(B) ofTitle 42, The Public Health and Welfare, and enactingsubsecs. (k)(4) to (8) of this section], shall apply withrespect to services performed after 1950, to the extentcovered by waiver certificates filed or deemed to havebeen filed under section 3121(k)(4) or (5) of the Inter-nal Revenue Code of 1954 (as added by such amend-ments) [subsec. (k)(4) or (5) of this section]."

Section 1207(f)(4) of Pub. L. 94-455 provided that:"(A) The amendments made by paragraphs (1)(A)

and (2)(A) of subsection (e) [enacting subsec. (b)(20)of this section and section 410(a)(20) of Title 42, ThePublic Health and Welfare] shall apply to services per-formed after December 31, 1971. The amendmentsmade by paragraphs (1)(B), (1)(C), and (2)(B) of suchsubsection [enacting sections 1401(c)(2)(F) and3401(a)(7) of this title and section 411(c)(2)(F) of title42] shall apply to taxable years ending after Decem-ber 31, 1971. The amendments made by paragraph (3)of such subsection [enacting section 6050A and amend.ing section 6652(b) of this title] shall apply to calen-dar years beginning after the date of the enactment ofthis Act [Oct. 4, 1976].

"(B) Notwithstanding subparagraph (A), if theowner or operator of any boat treated a share of theboat's catch of fish or other aquatic animal life (or ashare of the proceeds therefrom) received by an indi-vidual after December 31, 1971, and before the date ofthe enactment of this act [Oct. 4, 1976] for servicesperformed by such individual after December 31, 1971,on such boat as being subject to the tax under chapter21 of the Internal Revenue Code of 1954 [this chap-ter], then the amendments made by paragraphs (1)(A) and (B) and (2) of subsection () shall not applywith respect to such services performed by such indi-vidual (and the share of the catch, or the proceedstherefrom, received by him for such services)."

Amendment of subsec. (b) by section 1903 of Pub. L.94-455 applicable with respect to wages paid after Dec.31. 1976, see section 1903(d) of Pub. L. 94-455, set outas an Effective Date of 1976 Amendment note undersection 3101 of this title.

EFFECTIVE DATE OF 1973 AMENDMENTAmendment by Pub. L. 93-233 applicable only with

respect to remuneration paid after, and taxable yearsbeginning after, 1973, see section 5(e) of Pub. L. 93-233, set out as an Effective Date of 1973 Amendmentnote under section 409 of Title 42, The Public Healthand Welfare.

Amendment by Pub. L. 93-66 applicable only withrespect to remuneration paid after, and taxable yearsbeginning after, 1973, see section 203(e) of Pub. L. 93-66, set out as an Effective Date of 1973 Amendmentnote under section 409 of Title 42.

EFFECTIVE DATE OF 1972 AENDMENT

Amendment of subsec. (a) by Pub. L. 92-603 applica-ble in the case of any payment made after December1972, see sections 122(c) and 138(c) of Pub. L. 92-603,set out as an Effective Date of 1972 Amendment notesunder section 409 of Title 42.

Amendment of subsec. (a)(9) by section 104(i) ofPub. L. 92-603 applicable only with respect to pay-ments after 1974, see section 104(j) of Pub. L. 92-603,set out as an Effective Date of 1972 Amendment noteunder section 414 of Title 42.

Enactment of subsec. (b)(7)(D) by section 128(b) ofPub. L. 92-603 applicable with respect to service per-formed on and after the first day of the calendar quar-ter which begins on or after Oct. 30, 1972, see section128(c) of Pub. L. 92-603, set out as an Effective Dateof 1972 Amendment note under section 410 of Title 42.

Amendment of subsec. (b)(10)(B) by section129(a)(2) of Pub. L. 92-603 applicable to services per-formed after Dec. 31, 1972, see section 129(b) of Pub.L. 92-603, set out as an Effective Date of 1972 Amend-ment note under section 410 of Title 42.

Amendment by Pub. L. 92-336 applicable only withrespect to remuneration paid after December 1972, seesection 203(c) of Pub. L. 92-336, set out as an EffectiveDate of 1972 Amendment note under section 409 ofTitle 42,

EFCTIVE DATE OF 1971 AMENDMENT

Amendment by Pub. L. 92-5 applicable only with re-spect to remuneration paid after Dec. 1971, see section203(c) of Pub. L. 92-5, set out as an Effective Date of1971 Amendment note under section 409 of Title 42.

EFFECTIVE DATE OF 1969 AMENDmENT

Amendment of subsec. (k) by Pub. L. 91-172 applica.ble with respect to tax returns the date prescribed bylaw for filing of which is after Dec. 31, 1969, see sec.tion 943(d) of Pub. L. 91-172, set out as an EffectiveDate of 1969 Amendment note under section 6651 ofthis title.

EFFECTIVE DATE OF 1968 AMENDMENT

Amendment of subsec. (a)(1) by section 108(b) ofPub. L. 90-248 applicable only with respect to remu-neration paid after December 1967, see section 108(c)of Pub. L. 90-248, set out as an Effective Date of 1968Amendment note under section 409 of Title 42.

Section 504(d) of Pub. L. 90-248 provided that: "Theamendments made by this section [adding subsec.(a)(13) of this section and amending section 3306(b) ofthis title and section 409 of Title 42] shall apply withrespect to remuneration paid after the date of the en-actment of this Act [Jan. 2, 1968]."

Amendment of subsec. (b)(3)(B) by section 123(b) ofPub. L. 90-248 applicable with respect to services per-formed after Dec. 31, 1967, see section 123(c) of Pub.L. 90-248 set out as an Effective Date of 1968 Amend-ment note under section 410 of Title 42.


Amendment of subsecs. (a) and (q) by section 313 ofPub. L. 89-97 applicable only with respect to tips re-ceived by employees after 1965, see section 313(f) ofPub. L. 89-97, set out as an Effective Date note undersection 6053 of this title.

Amendment of subsecs. (b)(6)(C)(iv) and (b)(13) byPub. L, 89-97 applicable only with respect to servicesperformed after 1965, see section 311(c) of Pub. L. 89-97, set out as an Effective Date of 1965 Amendmentnote under section 410 of Title 42.

Amendment of subsection (b)(7) by section 317 ofPub. L. 89-97 applicable with respect to services per-formed after the quarter ending September 30, 1965,

§ 3121 Page 856


and after the quarter in which the Secretary of theTreasury receives a certification from the Commis-sioners of the District of Columbia expressing theirdesire to have the insurance system established by sec-tions 401 et seq. and 1395c et seq. of Title 42 extendedto the officers and employees coming under the provi-sions of such amendments, see section 317(g) of Pub.L. 89-97, set out as an Effective Date of 1965 Amend-ment note under section 410 of Title 42.

Section 316(a)(2) of Pub. L. 89-97 provided that:"The amendment made by paragraph (1) [to subsec.(h)(1)(B)(iii) of this section] shall apply in the case ofany certificate filed under section 3121(k)(1)(A) ofsuch Code (this title] after the date of the enactmentof this Act [July 30, 19651."

Section 320(c) of Pub. L. 89-97 provided that: "Theamendments made by subsections (a)(1) and (a)(3)(A)[to sections 409(a)(3)(4) and 413Ca)(2)(ii) of title 42],and the amendments made by subsection (b) (exceptparagraph (1) thereof) [to subsec. (a)(1) of this sectionand sections 3122, 3125(a), (b), 6413(c)(1) and6413(c)(2)(A) of this title], shall apply only with re-spect to remuneration paid after December 1965. Theamendments made by subsections (a)(2), Ca)(3)CB), andCb)(1) [to section 1402(b)(1), (c) and (d) of this titleand sections 411(b)(1), (c), (d) and 413Ca).2)(ii) of Title42] shall apply only with respect to taxable yearsending after 1965. The amendment made by subsec-tion (a)(4) [to section 415(e)(1) of Title 42] shall applyonly with respect to calendar years after 1965."


Section 4(d) of Pub. L. 88-650 provided that: "Theamendments made by this section [to sections 3121and 3306 of this title and section 409 of Title 42, ThePublic Health and Welfare] shall apply with respectto remuneration paid on or after the first day of thefirst calendar month which begins more than ten daysafter the date of the enactment of this Act [Oct. 13,1964]."

Amendment of subsec. (a)C5), by Pub. L. 88-272 ap-plicable to taxable years ending after Dec. 31, 1962, seesection 220(d) of Pub. L. 88-272, set out as an EffectiveDate note under section 406 of this title.

EFFECTIVE DATE OF 1961 AimirNr

Section 202(c) of Pub. L. 87-293 provided that: "Theamendments made by subsections (a) and Cb of thissection [to this section, sections 3122 and 6051 of thistitle and sections 405, 409, and 410 of Title 42, ThePublic Health and Welfare] shall apply with respectto service performed after the date of the enactmentof this Act [Sept. 22, 1961]. In the case of any individ-ual who is enrolled as a volunteer or volunteer leaderunder section 16(a) of this Act [stction 2515(a) of Title22, Foreign Relations and Intercourse] such amend-ments shall apply with respect to services performedon or after the effective date of such enrollment."

Section 202(c) of Pub. L. 87-293 repealed by Pub. L.89-572, § 5(a), Sept. 13, 1966, 80 Stat. 765. Such repealnot deemed to affect amendments contained in suchprovisions, see section 5(b) of Pub. L. 89-572, set out asa note under former section 2515 of Title 22.

Section 110(h)(3) of Pub. L. 87-256 provided that:"The amendments made by subsections (e) and (f) ofthis section [to this section and section 3306 of thistitle and section 410 of Title 42, The Public Healthand Welfare] shall apply with respect to service per-formed after December 31, 1961."

EFFFrIvE DATE OF 1960 Amm wMaTr

Amendment of subsec. (b)(3) by Pub. L. 86-778 appli-cable only with respect to services performed after1960, see section 104(c) of Pub. L. 86-778, set out as anEffective Date of 1960 Amendment note under section410 of Title 42, The Public Health and Welfare.

Amendment of subsec. (b)(7) by Pub. L. 86-778 appli-cable only with respect to (1) service in the employ ofthe Government of Guam or any political subdivisionthereof, or any instrumentality of any one or more ofthe foregoing wholly owned thereby, which is per.

formed after 1960 and after the calendar quarter inwhich the Secretary of the Treasury receives a certifi-cation by the Governor of Guam that legislation hasbeen enacted by the Government of Guam expressingits desire to have the insurance system established bytitle II of the Social Security Act, section 401 et seq. ofTitle 42, extended to the officers and employees ofsuch Government and such political subdivisions andinstrumentalities, and (2) service in the employ of theGovernment of American Samoa or any political sub-division thereof or any instrumentality of any one ormore of the foregoing wholly owned thereby, which isperformed after 1960 and after the calendar quarter inwhich the Secret. ry of the Treasury receives a certifi-cation by the Governor of American Samoa that theGovernment of American Samoa desires to have theinsurance system established by title II of the SocialSecurity Act, section 401 et seq. of Title 42, extendedto the officers and employees of such Government andsuch political subdivisions and instrumentalities, seesection 103(v)(1) of Pub. L. 86-778, set out as a noteunder section 402 of Title 42, and the amendment ofsubsec. (b)(7) of this section applicable only as e.-pressly provided therein, see section 103(v)(2) of Pub.L. 86-778, set out as an Effective Date of 1960 Amend-ment note under section 402 of Title 42.

Enactment of subsec. (b)(18) and amendment ofsubsec. (e) by Pub. L. 86-778 applicable only with re-spect to service performed after 1960, see section103(v)(1) of Pub. L. 86-778, set out as an EffectiveDate of 1960 Amendment note under section 402 ofTitle 42.

Section 18(k) of Pub. L. 86-624 provided that: "Theamendments contained in subsections (a) through (j)of this section [amending sections 2202, 3121, 3306,4221, 4233, 4262, 4502, 4774, 7653, and 7701 of thistitle] shall be effective as of August 21. 1959."

Section 105(d) of Pub. L. 86-778 provided that:"(1) The amendments made by subsection Ca) [tosubsec. (k)(1)(A), E) of this section] shall apply onlywith respect to certificates filed under section3121(k)C1) of the Internal Revenue Code of 1954[subsec. Ck)(1) of this section] after the date of the en-actment of this Act [Sept. 13, 1960].

"(2) No monthly benefits under title II of the SocialSecurity Act [section 401 et seq. of Title 42, ThePublic Health and Welfare] for the month in whichthis Act is enacted or any prior month shall be pay-able or increased by reason of the provisions of subsec-tions (b) and c) of this section or the amendmentsmade by such subsections [adding section 1402(g) ofthis title and enacting notes under this section and1402 of this title], and no lump-sum death paymentunder such title shall be payable or increased byreason of such provisions or amendments in the caseof any individual who died prior to the date of the en-actment of this Act [Sept. 13, 1960]."

Er'FCTIVE DATE OF 1959 Am zmNNTAmendment by Pub. L. 86-168 effective Jan. 1, 1960,

see section 203(c) of Pub. L. 86-168, set out as an Ef-fective Date of 1959 Amendment note under section6401 of Title 12, Banks and Banking.

Amendment by Pub. L. 86-70, effective Jan. 3, 1959,see section 22i) of Pub. L. 86-70, set out as an Effec-tive Date of 1959 Amendment note under section 2202of this title.


Section 402(e) of Pub. L. 85-840 provided that: "Theamendments made by subsections (b) and (c) [tosubsec. (a) of this section and section 3122 of this title]shall be applicable only with respect to remunerationpaid after 1958."

Section 404(b) of Pub. L. 85-840 provided that: "Theamendment made by subsection Ca) [to subsec. (b)(1)of this section] shall apply with respect to service per-formed after 1958."

Section 405(c) of Pub. L. 85-840 provided that: "Theamendments made by subsections Ca) and Cb) [tosubsec. (b)C8)CB) and kMC1) of this section] shall apply

Page 857 § 3121


with respect to certificates filed under section3121(k)(1) of the Internal Revenue Code of 1954[subsec. (k)(1) of this section] after the date of enact-ment of this Act [August 28, 1958] and requests filedunder subparagraph (F) of such section [subsec.(k)(1)CP) of this section] after such date."

Amendment of subsec. (1)(3) of this section by Pub.L. 85-866 applicable to taxable years beginning afterDec. 31, 1953, and ending after Aug. 16, 1954, see sec-tion 1(c) of Pub. L. 85-866, set out as an Effective Dateof 1958 Amendment note under section 165 of thistitle.

ErnC'riv DATz Op 1956 AmEN rmT

Section 201(m) of act Aug. 1, 1956, ch. 836, providedthat:

"Ml) The amendments made by subsection (a)[adding section 3113 of this title] and paragraph (1) ofsubsection (h) [to subsec. (a)(8)(B) of this section]shall apply with respect to remuneration paid after1956. The amendment made by subsection (b) [tosubsec. (a)(9) of this section] shall apply with respectto remuneration paid after October 1956. The amend-ments made by subsection (c) [to subsec. (b)(1)(B) ofthis section] and paragraph (2) of subsection (h) [tosubsec. (o) of this section] shall apply with respect toservice performed after 1956. The amendments madeby paragraphs (1) and (2) of subsection d) [to subsecs.(b)(6)(B)Cii) and (b)(6)(C)vi) of this section] shallapply with respect to service with respect to which theamendments made by paragraphs (1) and (2) of sub-section (b) of section 104 of this Act [to sections410(a)(6)(B)(i) and 410(a)(6)(C)(vi) of Title 42, thePublic Health and Welfare] apply. The amendmentsmade by paragraph (1) of subsection (e) [to subsec.(b)(16) of this section] shall apply with respect to ser-vice performed after 1954. The amendment made byparagraph (3) of such subsection shall [to section1402(c)(2) of this title] apply with respect to taxableyears ending after 1954. The amendments made byparagraph (2) of subsection (e) [to section 1402(a)(1)of this title] and by subsection (f) (to section1402(c)(5) of this title] shall apply with respect to tax-able years ending after 1955. The amendment made bysubsection (i) [to section 1402(a) of this title] shallapply with respect to taxable years ending on or afterDecember 31, 1956. The amendment made by subsec-tion (1) [to the fifth sentence of subsec. (k)l) of thistitle] shall apply with respect to certificates filed after1956 under section 3121 (k) [subsec. (k) of this section]of the Internal Revenue Code of 1954.

"(2)(A) Except as provided in subparagraph (B), theamendment made by subsection (g) (to section1402(a)(8)(B) of this title] shall apply only with re-spect to taxable years ending after 1956.

"(B) Any individual who, for a taxable year endingafter 1954 and prior to 1957, had income which byreason of the amendment made by subsection (g)would have been included within the meaning of 'netearnings from self-employment' (as such term is de-fined in section 1402(a) of the Internal Revenue Codeof 1954 [section 1402(a) of this title]), if such incomehad been derived in a taxable year ending after 1956by an individual who had filed a waiver certificateunder section 1402(e) of such Code, may elect to havethe amendment made by subsection (g) apply to histaxable years ending after 1954 and prior to 1957. Noelection made by any individual under this subpara-graph shall be valid unless such individual has filed awaiver certificate under section 1402(e) of such Codeprior to the making of such election or files a waivercertificate at the time he makes such election.

"(C) Any individual described in subparagraph (B)who has fied a waiver certificate under section 1402(e)of such Code prior to the date of enactment of thisAct [Aug. 1, 1956], or who files a waiver certificateunder such section on or before the due date of hisreturn (including any extension thereof) for his lasttaxable year ending prior to 1957, must make suchelection on or before the due date of his return (in-cluding any extension thereof) for his last taxable

year ending prior to 1957, or before April 16, 1957,whichever is the later."(D) Any individual described in subparagraph (B)

who has not filed a waiver certificate under section1402(e) of such Code on or before the due date of hisreturn (including any extension thereof) for his lasttaxable year ending prior to 1957 must make suchelection on or before the due date of his return (in-cluding any extension thereof) for his first taxableyear ending after 1956. Any individual described Inthis subparagraph whose period for filing a waiver cer-tificate under section 1402(e) of such Code has expiredat the time he makes such election may, notwithstand-Ing the provisons of paragraph (2) of suclh section, filea waiver certificate at the time he makes such elec-tion.

"CE) An election under subparagraph (B) shall bemade in such manner as the Secretary of the Treasuryor his delegate shall prescribe by regulations. Notwith-standing the provisions of paragraph (3) of section1402(e) of such Code, the waiver certificate filed by anindividual who makes an election under subparagraph(B) (regardless of when filed) shall be effective forsuch individual's first taxable year ending after 1954in which he had income which by reason of theamendment made by subsection (g) would have beenincluded within the meaning of 'net earnings from self-employment' (as such term is defined in section 1402(a)of such Code), if such income had been derived in ataxable year ending after 1956 by an individual whohad filed a waiver certificate under section 1402(e) ofsuch Code, or for the taxable year prescribed by suchparagraph (3) of section 1402(e), if such taxable yearis earlier, and for all succeeding taxable years.

"(F) No interest or penalty shall be assessed or col-lected for failure to file a return within the time pre-scribed by law, if such failure arises solely by reason ofan election made by an individual under subparagraph(B), or for any underpayment of the tax imposed bysection 1401 of such Code arising solely by reason ofsuch election, for the period ending with the date suchindividual makes an election under subparagraph (B).

"(3) Any tax under chapter 2 of the Internal Rev-enue Code of 1954 [section 1401 et seq. of this title]which is due, solely by reason of the enactment of sub-section (f) [amending section 1402(c)(5) of this title],or paragraph (2) of subsection (e), of this section[amending section 1402(a)(1) of this title], for any tax-able year ending on or before the date of the enact-ment of this Act [August 1, 1956] shall be consideredtimely paid If payment is made in full on or before thelast day of the sixth calendar month following themonth in which this Act is enacted [August 1956], Inno event shall interest be imposed on the amount ofany tax due under such chapter solely by reason ofthe enactment of subsection (f), or paragraph (2) ofsubsection (e), of this section for any period before theday after the date of enactment of this Act [August 1,1956].

"(4) Any tax due under chapter 21 of the InternalRevenue Code of 1954 (this chapter] which is due,solely by reason of the enactment of subsection (d)[amending subsecs. (b)(6)(B)(i) and (b)(6)(C)(v) ofthis section] and an effective date prescribed pursuantto paragraph (2)(B) or (2)(C) of section 104(i) [set outas a note under section 410 of Title 42, The PublicHealth and Welfare], for any calendar quarter begin-ning prior to the day on which the Secretary ofHealth, Education, and Welfare approves the planwhich prescribes such effective date shall be consid-ered timely paid if payment is made in full on orbefore the last day of the sixth calendar month fol-lowing the month in which such plan is approved. Inno event shall interest be imposed on the amount ofany such tax due under such chapter for any periodbefore the day on which the Secretary of Health, Edu-cation, and Welfare approves such plan."

Subsecs. (1), (m), and (n), as amended by act Aug. 1,1956, ch. 837, effective Jan. 1, 1957.

Page 858§ 3121


EFFCTIVE DATE OF 1954 AMENDMENT

Section 204(c) of act Sept. 1, 1954, provided that theamendments to subsec. (a) by said act shall be applica-ble only with respect to remuneration paid after 1954.

Section 205(f) of act Sept. 1, 1954, provided that theamendments to subsec. (b)(4), (6)(B), (6)(C), (14), and(16) made by said act shall be applicable only with re-spect to services performed after 1954 and amend-ments to subsec. (b)(1) and (3) should be applicableonly with respect to services (whether performed after1954 or prior to 1955) for which the remuneration isafter 1954,

Section 206(b) of act Sept. 1, 1954, provided that theamendment to subsec. (d)(3)(C) by said act shall be ap-plicable only with respect to services performed after1954.

REPEALS; AMENDMENTS AND APPLICATION OFAMENDMENTS UNAFFECTED

Section 202(a)(1), (2) of Pub. L. 87-293 repealed byPub. L. 89-572, § 5(a), Sept. 13, 1966, 80 Stat. 765. Suchrepeal not deemed to affect amendments to this sec-tion contained in such provisions, and continuation infull force and effect until modified by appropriate au-thority of all determinations, authorization, regula-tions, orders, contracts, agreements, and other actionsissued, undertaken, or entered into under authority ofthe repealed provisions, see section 5(b) of Pub. L. 89-572, set out as a note under section 2515 of Title 22,Foreign Relations and Intercourse.

TRANSFER or FUNCTIONS

For transfer of all functions, property, records, andpersonnel of the Bureau of Federal Credit Unions tothe National Credit Union Administration, see section6 of Pub. L. 91-206, Mar. 10, 1970, 84 Stat. 51.

All functions of Public Health Service, of the Sur-geon General of the Public Health Service, and of allother officers and employees of the Public Health Ser-vice, and all functions of all agencies of or in thePublic Health Service transferred to Secretary ofHealth, Education, and Welfare by 1966 Reorg. PlanNo. 3, 31 P.R. 8855, 80 Stat. 1610, effective June 25,1966, set out in the Appendix to Title 5, GovernmentOrganization and Employees.

The Coast and Geodetic Survey was consolidatedwith the National Weather Bureau in 1965 to form theEnvironmental Science Services Administration byReorg. Plan No. 2 of 1965, eff. July 13, 1965, 30 F.R.8819, 79 Stat. 1318, set out in the Appendix to Title 5,Government Organization and Employees. The Com-missioned Officer Co."ps of the Environmental ScienceServices Administration was changed to the Commis-sioned Officer Corps of the National Oceanic and At-mospheric Administration, see 1970 Reorg. Plan No. 4,§ 4(d), eff, Oct. 3, 1970, 35 F.R. 15827, 84 Stat. 2190, setout in the Appendix to Title 5.

SUBVERSIVE ACTIVITIES CONTROL BOARD

The Subversive Activities Control Board was estab-lished by act Sept. 23, 1950, ch. 1024, § 12, 64 Stat. 977and ceased to operate June 30, 1973.

COVERAGE OF FEDERAL HOME LOAN BANK EMPLOYEES

For provisions affecting the coverage of FederalHome Loan Bank employees under subsec. (b)(6)(B)(ii)of this section, see section 125(a) of Pub. L. 92-603, setout as a note under section 410 of Title 42, The PublicHealth and Welfare.

REFUND OR CREDIT OF TAXES TO NONPROFIT ORGANIZA-TIONS AFTER SEPT. 9, 1976, ON TAXES PAID UNDER SEC-TIONS 3101 or 3111; PROHIBITION: CONSTRUCTIVEFILING 00 CERTIFICATE

Section 2 of Pub. L. 94-563 provided that: "Notwith-standing any other provision of law, no refund orcredit of any tax paid under section 3101 or 3111 ofthe Internal Revenue Code of 1954 [section 3101 or3111 of this title] by an organization described in sec-tion 501(c)(3) of such Code [section 501(c)(3) of this

title] which is exempt from income tax under section501(a) of such Code [section 501(a) of this title] shallbe made on or after September 9, 1976. by reason ofsuch organization's failure to file a waiver certificateunder section 3121(k)(1) of such Code [subsec. (k)(1)of this section] (or the corresponding provision ofprior law), if such organization is deemed to have filedsuch a certificate under section 3121(k)(4) of suchCode (subsec. (k)(4) of this section] (as added by thefirst section of this Act)."

REMUNERATION FOR SERvIcEs DEzwEn ro CONSTITUTEEMPLOYMENT; SERVICES FOR ORGANIZATIONS DEEMEDTO HAVE FILED CERTIFICATES

Section 3 of Pub. L. 94-563 provided that:"In any case where-

"(1) an individual performed service, as an employ-ee of an organization which is deemed under section3121(k)(5) of the Internal Revenue Code of 1954[subsec. (k)(5) of this section] to have filed a waivercertificate under section 3121(k)(1) of such Code(subsec. (k)(1) of this section], at any time prior tothe period for which such certificate is effective;

"(2) the taxes imposed by sections 3101 and 3111 ofsuch Code [section 3101 and 3111 of this title] werepaid with respect to remuneration paid for such ser-vice, but such service (or any part thereof) does notconstitute employment (as defined in section 210(a)of the Social Security Act [section 410(a) of Title 42,The Public Health and Welfare] and section 3121(b)of such Code (subsec. (b) of this section] because theapplicable taxes so paid were refunded or credited(otherwise than through a refund or credit whichwould have been allowed if a valid waiver certificatefiled under section 3121(k)(1) of such Code [subsec.(k)(1) of this section] had been in effect) prior toSeptember 9, 1976; and

"(3) any portion of such service (with respect towhich taxes were paid and refunded or credited asdescribed in paragraph (2)) would constitute employ-ment (as so defined) if the organization had actuallyfiled under section 3121(k)(1) of such Code [subsec.(k)(1) of this section] a valid waiver certificate effec-tive as provided in section 3121(k)(5)(B) [subsec.(k)(5)(B) of this section] thereof (with such individ-ual's signature appearing on the accompanying list),

the remuneration paid for the portion of such servicedescribed in paragraph (3) shall, upon the request ofsuch individual (filed in such manner and form, andwith such official, as may be prescribed by regulationsmade under title II of the Social Security Act [section401 et seq. of Title 42]) accompanied by full repay-ment of the taxes which were paid under section 3101of such Code [section 3101 of this title] with respect tosuch remuneration and so refunded or credited, bedeemed to constitute remuneration for employment asso defined. In any case where remuneration paid by anorganization to an individual is deemed under the pre-ceding sentence to constitute remuneration for em-ployment, such organization shall be liable (notwith-standing any other provision of such Code) for repay-ment of any taxes which it paid under section 3111 ofsuch Code [section 3111 of this title] with respect tosuch remuneration and which were refunded or cred-ited to it."

SERVICE FOR CERTAIN TAX-EXEMPT ORGANIZATIONSPRIOR TO FILING OF WAIVER CERTIFICATE

Section 105(b)(1) to (5) of Pub. L. 86-778, as amend-ed by Pub. L. 89-97, title III, § 316(c)(1), July 30, 1965,79 Stat. 386, provided that:

"(b)() If-"(A) an individual performed service in the employ

of an organization with respect to which remunera-tion was paid before the first day of the calendarquarter in which the organization filed a waiver cer-tificate pursuant to section 3121(k)(1) of the Inter-nal Revenue Code of 1954 [subsec. (k)(1) of this sec-tion], and such service is excepted from employmentunder section 210(a)(8)(B) of the Social Security Act

§ 3121Page 859


(section 410(a)(8)(B) of Title 42, The Public Healthand Welfare],

"(B) such service would have constituted employ-ment as defined in section 210 of such Act [section410 of Title 42] if the requirements of section3121(k)(1) of such Code [subsec. (k)(1) of this sec-tion] were satisfied,

"(C) such organization paid, on or before the duedate of the tax return for the calendar quarterbefore the calendar quarter in which the organiza-tion filed a certificate pursuant to section 3121(k)(1)of such Code [subsec. (k)(1) of this section], anyamount, as taxes imposed by sections 3101 and 3111of such Code (this title] with respect to such remu-neration paid by the organization to the individualfor such service,

"(D) such individual, or a fiduclajy acting for suchindividual or his estate, or his survivor (within themeaning of section 205(c)(1)(C) of such Act [section405(c)(1)(C) of Title 42]), requests that such remu-neration be deemed to constitute remuneration foremployment for purposes of title II of such Act [sec-tion 401 et seq. of Title 42], and

"E) the request is made in such form and manner,and with such official, as may be prescribed by regu-lations made by the Secretary of Health, Education,and Welfare,

then, subject to the conditions stated in paragraphs(2), (3), (4). and (5), the remuneration with respect towhich the amount has been paid as taxes shall bedeemed to constitute remuneration for employmentfor purposes of title II of such Act (section 401 et seq.of Title 42].

"(2) Paragraph (1) shall not apply with respect to anindividual unless the organization referred to in para-graph (1)(A), on or before the date on which the re-quest described in paragraph (1) is made, has filed acertificate pursuant to section 3121(k)(1) of such Code(subsec. (k)(1) of this section].

"(3) Paragraph (1) shall not apply with respect to anindividual who is employed by the organization re-ferred to in paragraph (2) on the date the certificate isfiled.

"(4) If credit or refund of any portion of the amountreferred to in paragraph i1)(C) (other than a credit orrefund which would be allowed if the service constitut-ed employment for purposes of chapter 21 of suchCode [this title]) has been obtained, paragraph (1)shall not apply with respect to the individual unlessthe amount credited or refunded (including any inter-est under section 6611 of such Code) is repaid beforeJanuary 1, 1968, or, if later, the first day of the thirdyear after the year in which the organization filed acertificate pursuant to section 3121(k)(1) of such Code[subsec. (k)(1) of this section].

"(5) Paragraph (1) shall not apply to any service per-formed for the organization in a period for which acertificate filed pursuant to section 3121(k)(1) of suchCode [subsec. k)(1) of this section] is not in effect."

Pub, L. 89-97, title III, § 316(c)(2), July 30, 1965, '79Stat. 387, provided that: "The ,..nendment made byparagraph (1) [to section 105(b) of Pub. L. 86-778, setout above] shall take effect on the date of the enact-ment of this Act [July 30, 19651. The provisions of sec-tion 105(b) of the Social Security Amendments of 1960[section 105(b) of Pub. L. 86-771] which were in effectbefore the date of the enactment of this Act [July 30,1965] shall be applicable with respect to any requestfiled under section 105(b)(1) of such Amendmentsbefore such date. Nothing in the preceding sentenceshall prevent the filing of a request under section105(b)(1) of such Amendments as amended by thisAct."

SERVICE FOR CERTAIN TAx-EXEMPT ORGANIZATIONS FOR

WHICH REMUNERATION WAS PAID BEFORE JULY 30,1966, BuT AFTER FILING or WAIVER CERTIFICATE

Section 316(d) of Pub. L. 89-97 provided that wherean individual performed service for which remunera-tion was paid before July 30, 1965, by an organizationwhich, before such date, filed a waiver certificate pur-

suant to subsec. (k)(1) of this section, then under cer-tain conditions, the remuneration paid with respect tosuch service was to be deemed remuneration for er-ployment for purposes of title II of the Social SecurityAct, sections 401 et seq, of Title 42, The Public Healthand Welfare, even though normally excluded from em-ployment under title II of the Social Security Act.

SERVICE FOR CERTAIN TAx-ExEmPT ORGANIZATIONS

PEIFonxzD AFrE 1950 A" PRIOR TO JULY 1, 1960

Section 105(b)(1) to (5) of Pub. L. 86-778 providedthat where an individual performed service in theemploy of an organization after 1950 with respect towhich remuneration was paid before 1960 and suchservice is normally excepted from employment undertitle II of the Social Security Act, section 401 et seq. ofTitle 42, The Public Health and Welfare, then undercertain conditions, the remuneration paid with respectto such service was to be deemed remuneration for em-ployment for purposes of title II of the Social SecurityAct.

SERVICE FOR CERTAIN TAX-EXEMPT OROANIZATIONS

PERPORMED AlrE 1950 AND PRIOR TO 1957Section 403 of act Sept. 1, 1954, as amendud by acts

Aug. 1, 1956, ch. 836, title IV, § 401, 70 Stat, 855; Aug.27, 1958, Pub. L. 85-785, §§ 1 to 3, 72 Stat. 938, providedthat where an individual has been employed after 1950and before Aug. 1, 1956, by an organization exemptfrom income tax under section 501(c)(3) of this titlebut which did not have in effect during the individ-ual's period of employment a valid waiver certificate,or, which failed to have the individual's signatureappear on the list of signatures of employees who con-curred in the filing of such certificate, where one wasin effect, and the service performed by the individualwould have constituted employment for purposes oftitle II of the Social Security Act, section 401 et seq. ofTitle 42, The Public Health and Welfare, had such re-quirements been met, then under certain conditions,the remuneration paid was to be deemed remunera-tion for employment for purposes of title II of theSocial Security Act.

SECTION RnFERI= TO IN OTHER SECTIONS

This section Is referred to in sections 44A, 176, 401,406, 412, 1402, 1563, 3101, 3102, 3111, 3122, 3124, 3125,3201, 3202, 3211, 3221, 3306, 3401, 6051, 6053. 6413,6652 of this title; title 7 section 2042; title 20 section125; title 29 section 1082; title 42 sections 401, 409, 410,430; title 45 sections 231b, 231e; title 49 section 303.

§ 3122, Federal service

In the case of the taxes imposed by this chap-ter with respect to service performed in theemploy of the United States or in the employof any instrumentality which is wholly ownedby the United States, including service, per-formed as a member of a uniformed service, towhich the provisions of section 3121(m)(1) areapplicable, and including service, performed asa volunteer or volunteer leader within themeaning of the Peace Corps Act, to which theprovisions of section 3121(p) are applicable, thedetermination whether an individual has per-formed service which constitutes employmentas defined in section 3121(b), the determinationof the amount of remuneration for such servicewhich constitutes wages as defined in section3121(a), and the return and payment of thetaxes imposed by this chapter, shall be made bythe head of the Federal agency or instrumen-tality having the control of such service, or bysuch agents as such head may designate. Theperson making such return may, for conve-nience of administration, make payments of thetax imposed under section 3111 with respect to

§ 3122 Page 860


such service without regard to the $7,800 limi-tation in section 3121(a)(1), and he shall not berequired to obtain a refund of the tax paidunder section 3111 on that part of the remu-neration not included in wages by reason of sec-tion 3121(a)(1). Payments of the tax imposedunder section 3111 with respect to service, per-formed by an individual as a member of a uni-formed service, to which the provisions of sec-tion 3121(m)(1) are applicable, shall be madefrom appropriations available for the pay ofmembers of such uniformed service. The provi-sions of this section shall be applicable in thecase of service performed by a civilian employ-ee, not compensated from funds appropriatedby the Congress, in the Army anc Air Force Ex-change Service, Army and Air Force MotionPicture Service, Navy Exchanges, Marine CorpsExchanges, or other activities, conducted by aninstrumentality of the United States subject tothe jurisdiction of the Secretary of Defense, atinstallations of the Department of Defense forthe comfort, pleasure, contentment, and mentaland physical improvement of personnel of suchDepartment; and for purposes of this sectionthe Secretary of Defense shall be deemed to bethe head of such instrumentality. The provi-sions of this section shall be applicable also inthe case of service performed by a civilian em-ployee, not compensated from funds appropri-ated by the Congress, in the Coast Guard Ex-changes or other activities, conducted by an in-strumentality of the United States subject tothe Jurisdiction of the Secretary of Transporta-tion at installations of the Coast Guard for thecomfort, pleasure, contentment, and mentaland physical improvement of personnel of theCoast Guard; and for purposes of this sectionthe Secretary of Transportation shall bedeemed to be the head of such instrumentality.

(Aug. 16, 1954, ch. 736, 68A Stat. 428; Sept. 1,1954, ch. 1206, title II, § 202(c), 203(a), 68 Stat.1090; Aug. 1, 1956, ch. 837, title IV, § 411(b), (c),70 Stat. 879; Aug. 28, 1958, Pub. L. 85-840, titleIV, § 402(c), 72 Stat. 1042; Sept. 2, 1958, Pub. L.85-866, title I, § 70, 72 Stat. 1660; Sept. 22, 1961,Pub. L. 87-293, title II, § 202(a)(3), 75 Stat. 626;July 30, 1965, Pub. L. 89-97, title III, § 320(b)(3),79 Stat. 393; Jan. 2, 1968, Pub. L. 90-248, title I,§ 108(b)(3), 81 Stat. 835; Mar. 17, 1971, Pub. L.92-5, title II, § 203(b)(3), 85 Stat. 11; July 1,1972, Pub. L. 92-236, § 203(b)(3)(A), (B), (C), 86Stat. 419; July 9, 1973, Pub. L. 93-66, § 203(b)(3),(d), 87 Stat. 153; Dec. 31, 1973, Pub. L. 93-233,§ 5(b)(3), 87 Stat. 954; Oct. 4, 1976, Pub. L. 94-455, title XIX, § 1903(a)(4), 90 Stat. 1807.)

REFERENcEs iN TEXT

The Peace Corps Act, referred to in text, is Pub. L.87-293, Sept. 22, 1961, 75 Stat. 612, as amended, whichis classified principally to chapter 34 (§ 2501 et seq.) ofTitle 22, Foreign Relations and Intercourse. For com-plete classification of this Act to the Code, see ShortTitle note set out under section 2501 of Title 22 andTables volume.

AMENDMENTS

1976-Pub. L. 94-455 substituted "Secretary ofTransportation" for "Secretary" in two places.

1973-Pub. L. 93-233, § 5(b)(3). effective with respectto remuneration paid after 1973, substituted "$13,200"for "$12,600".

Pub. L. 93-233, § 5(d), applicable only with respect toremuneration paid after, and taxable year beginningafter, 1973 (as provided in section 5(e) of Pub. L. 93-233, set out as a note under section 409 of Title 42),amended section 203(b)(3)(C) of Pub. L. 92-336 (setout as 1973 Amendment note hereunder) substituting"$13,200" for "$12,600".

Pub. L. 93-66, § 203(b)(3), effective with respect toremuneration paid after 1973, substituted "$12,600"for "$12,000".

Pub. L. 93-66, § 203(d), applicable only with respectto remuneration paid after, and taxable years begin.ning after, 1973 (as provided in section 203(e) of Pub.L. 93-66, set out as a note under section 409 of Title42), amended section 203(b)(3)(C) of Pub. L. 92-336(set out as 1972 Amendment note hereunder) substi-tuting "$12,600" for "$12,000".

1972-Pub. L. 92-336, § 203(b)(3)(A), substituted"$10,800" for "$9,000".

Pub. L. 92-336, § 203(b)(3)(B), effective with respectto remuneration paid after 1973, substituted "$12,000"for "$10,800".

Pub. L. 92-336, § 203(b)(3)(C). effective with respectto remuneration paid after 1974, substituted "contri-bution and benefit base" for "$12,000".

1971-Pub. L. 92-5 substituted "$9,000" for "$7,800".1968-Pub. L. 90-248 substituted "$7,800" for

"$6,600" in the second sentence.1965-Pub. L. 89-97 substituted "$6,600" for

"$4,800".1961-Pub. L. 87-293 inserted "and including service,

performed as a volunteer or volunteer leader withinthe meaning of the Peace Corps Act, to which the pro-visions of section 3121(p) are applicable," following"section 3121(m)(1) are applicable,".

1958-Pub. L. 85-866 substituted "section" for "sub-section" wherever appearing,

Pub. L. 85-840 substituted "$4,800" for $4,200".1956-Act Aug. 1, 1956, included taxes with respect

to service, performed as a member of a uniformed ser-vice, to which the provisions of section 3121(m)(1) ofthis title are applicable, and authorized payment ofthe tax imposed under section 3111 of this title fromappropriations available for pay of members of theuniformed service.

1954-Act Sept. 1, 1954, § 202(c) substituted "$4,200"for "$3,600".

Act Sept. 1, 1954, § 203(a), added provisions makingthe section applicable to services performed by a civil-ian employee in the Coast Guard Exchanges or certainother activities at Coast Guard installations.

Empfnv DATE or 1973 AMENDMENT

Amendment by Pub. L. 93-233 applicable only withrespect to remuneration paid after, and taxable yearsbeginning after, 1973, see section 5(e) of Pub. L. 93-233, set out as an Effective Date of 1973 Amendmentnote under section 409 of Title 42, The Public Healthand Welfare.



Amendment by Pub. L. 92-336 applicable only withrespect to remuneration paid after December 1972, seesection 203(c) of Pub. L. 92-336, set out as an EffectiveDate of 1972 Amendment note under section 409 ofTitle 42.

EFfecrivE DATE or 1971 AMENDMENT

Amendment by Pub. L. 92-5 applicable only with re-spect to renumeration paid after Dec. 1971, see section203(c) of Pub. L. 92-5, set out as an Effective Date of1971 Amendment note under section 409 of Title 42.

ErEcTIVE DATE OF 1968 AMENDMENT

Amendment by Pub. L. 90-248 applicable only withrespect to remuneration paid after December 1967, see

§ 3122Page 861


section 108(c) of Pub. L. 90-248, set out as an EffectiveDate of 1968 Amendment note under section 409 ofTitle 42, The Public Health and Welfare.

Ecrxvz DATE or 1965 A.ummlmTAmendment by Pub. L. 89-97 applicable with respect

to remuneration paid after December, 1965, see sec-tion 320(c) of Pub. L. 89-97, set out as an EffectiveDate of 1965 Amendment note under section 3121 ofthis title.

EnzwrxvE DATE OF 1961 AmrmmxNT

Amendment by Pub. L 87-293 applicable with re-spect to service performed after Sept. 22, 1961, but inthe case of persons serving under the Peace Corpsagency established by executive order applicable withrespect to service performed on or after the effectivedate of enrollment, see section 202(c) of Pub. L. 87-293, set out as an Effective Date of 1961 Amendmentnote under section 3121 of this title.

EFFEcTrvE DATE o 1958 Aumwrr

Amendment by Pub. L. 85-866 applicable to taxableyears beginning after Dec. 31, 1953. and ending afterAug. 16, 1954, see section l(c) of Pub. L. 85-866, set outas an Effective Date of 1958 Amendment note undersection 165 of this title.

Amendment by Pub. L. 85-840 applicable only withrespect to remuneration paid after 1958, see section402(e) of Pub. L. 85-840, set out as an Effective Dateof 1958 Amendment note under section 3121 of thistitle.

Ern'ivE DATE OF 1954 AmwDmzrr

Section 202(d) of act Sept. 1, 1954, provided in partthat the amendment to this section by section 202(c)of said act should be applicable only with respect toremuneration paid after 1954.

Section 203(b) of act Sept. 1, 1954, provided that theamendment to this section by section 203(a) of said actshould become effective Jan. 1, 1955.

RrA Lxs; AMNMmENTs AxD APPLICATION OFAmEcmZNT UNAmc'rm

Section 202(a)(3) of Pub. L. 87-293 repealed by Pub.L. 89-572, § 5(a), Sept. 13. 1966, 80 Stat. 765. Suchrepeal not deemed to affect amendments to this sec-tion contained in such provisions, and continuation infull force and effect until modified by appropriate au-thority of all determinations, authorization, regula-tions, orders, contracts, agreements, and other actionsissued, undertaken, or entered into under authority ofthe repealed provisions, see section 5(b) of Pub. L. 89-572, set out as a note under section 2515 of Title 22,Foreign Relations and Intercourse.

SECrxoN RmMUzn TO Ms Omm SEcTIoNsThis section is referred to in sections 6205, 6413 of

this title; title 42 section 430.

fI 3123. Deductions as constructive paymentsWhenever under this chapter or any act of

Congress, or under the law of any State, an em-ployer Is required or permitted to deduct anyamount from the remuneration of an employeeand to pay the amount deducted to the UnitedStates, a State, or any political subdivisionthereof, then for purposes of this chapter theamount so deducted shall be considered to havebeen paid to the employee at the time of suchdeduction.(Aug. 16, 1954, ch. 736, 68A Stat. 429.)

§ 3124. Estimate of revenue reduction

The Secretary at intervals of not longer than3 years shall estimate the reduction in the

amount of taxes collected under this chapter byreason of the operation of section 3121(b)(9)and shall include such estimate in his annualreport.(Aug. 16, 1954, ch. 736, 68A Stat. 429; Sept. 1,1954, ch. 1206, title II, § 205(b), 68 Stat. 1091;Oct. 4, 1976, Pub. L. 94-455, title XIX,§ 1906(b)(13)(A), 90 Stat. 1834.)

AMNDmrs

1976-Pub. L. 94-455 struck out "or his delegate" fol-lowing "Secretary".

1954-Act Sept. 1, 1954, changed reference from"section 3121(b)(10)" to "section 3121(b)(9)".

§ 3125. Returns in the case of governmental employ.ees in Guam, American Samoa, and the Districtof Columbia

(a) GuamThe return and payment of the taxes imposed

by this chapter on the ncome of individualswho are officers or employees of the Govern-ment of Guam or any political subdivisionthereof or of any instrumentality of any one ormore of the foregoing which is wholly ownedthereby, and, those Imposed on such Govern-ment or political subdivision or instrumentalitywith respect to having such individuals in itsemploy, may be made by the Governor ofGuam or by such agents as he may designate.The person making such return may, for conve-nience of administration, make payments of thetax imposed under section 3111 with respect tothe service of such individuals without regardto the contribution and benefit base limitationin section 3121(a)(1).(b) American Samoa

The return and payment of the taxes imposedby this chapter on the income of individualswho are officers or employees of the Govern-ment of American Samoa or any political subdi-vision thereof or of any instrumentality of anyone or more of the foregoing which is whollyowned thereby, and those imposed on suchGovernment or political subdivision or instru-mentality with respect to having such individ-uals in its employ, may be made by the Gover-nor of American Samoa or by such agents as hemay designate. The person making such returnmay, for convenience of administration, makepayments of the tax imposed under section3111 with respect to the service of such individ-uals without regard to the contribution andbenefit base limitation in section 3121(a)(1).(c) District of Columbia

In the case of the taxes imposed by this chap-ter with respect to service performed in theemploy of the District of Columbia or in theemploy of any instrumentality which is whollyowned thereby, the return and payment of thetaxes may be made by the Miyor of the Dis-trict of Columbia or such agents as he may des-ignate. The person making such return may,for convenience of administration, make pay-ments of the tax imposed by section 3111 withrespect to such service without regard to thecontribution and benefit base limitation in sec-tion 3121(a)(1).(Added Pub. L. 86-778, title I, § 103(q)(1), Sept.13, 1960, 74 Stat. 939, and amended Pub. L. 89-97, title III, §§ 317(c)(1), (2), 320(b)(4), July 30,

§ 3123 Page 862


1965, 79 Stat. 389, 393; Pub. L. 90-248, title I,§ 108(b)(4), Jan. 2,1968, 81 Stat. 835; Pub. L. 92-5, title II, § 203(b)(4), Mar. 17, 1971, 85 Stat. 11;July 1, 1972, Pub. L. 92-336, title II, § 203(b)(4),86 Stat. 419; July 9,1973, Pub. L. 93-66, title II,§ 203(b)(4), (d), 87 Stat. 153; Dec. 31, 1973, Pub.L. 93-233, § 5(b)(4), (d), 87 Stat. 954; Pub. L. 94-455, title XIX, § 1903(a)(5), Oct. 4, 1976, 90 Stat.1807.)

AMnDMENTS1976-Subsec. (c). Pub. L. 94-455 substituted "Mayor

of the District of Columbia or such agents as he maydesignate" for "Commissioners of the District of Co.lumbia or such agents as they may designate".

1973-Pub. L. 93-233, § 5(b)(4), effective with respectto remuneration paid after 1973, substituted "$13,200"for "$12,600" wherever appearing.

Pub. L. 93-233, § 5(d), applicable only with respect toremuneration paid after, and taxable years beginningafter, 1973 (as provided in section 5(e) of Pub. L. 93-233, set out as a note under section 409 of Title 42),amended section 203(b)(4)(C) of Pub. L. 92-336 (setout as 1973 Amendment note hereunder) substituting"$13,200" for "$12,600".

Pub. L. 93-66, § 203(b)(4), effective with respect toremuneration paid after 1973, substituted "$12,600"for "$12,000" wherever appearing.

Pub. L. 93-66, § 203(d), applicable only with respectto remuneration paid after, and taxable years begin-ning after, 1973 (as provided in section 203(e) of Pub.L. 93-66, set out as a note under section 409 of Title42), amended section 203(b)(4)(C) of Pub. L. 92-336(set out as 1972 Amendment note hereunder) substi-tuting "$12,600" for "$12,000".

1972-Pub. L. 92-336. § 203(b)(4)(A), substituted"$10,800" for "$9,000" wherever appearing therein.

Pub. L 92-336, § 203(b)(4)(B), effective with respectto remuneration paid after 1973, substituted "$12,000"for "$10,800" wherever appearing therein.

Pub. L. 92-336. § 203(b)(4)(C), effective with respectto remuneration paid after 1974, substituted "contri-bution and benefit base" for "$12,000".

1971-Pub. L. 92-5 substituted "$9,000" for "$7,800"wherever appearing.

1968-Pub. L 90-248 substituted "$7,800" for"$6,600" wherever appearing.

1965-Subsecs. (a), (b). Pub. L. 89-97, § 320(b)(4),substituted "$6,600" for "$4,800".

Subsec. (c). Pub. L. 89-97, § 317(c)(1), added subsec.(c) and inserted reference to District of Columbia inthe section catchline.

Errzcriv DATic OF 1973 AummxNwr

Amendment by Bib. L 93-233 applicable only withrespect to remuneration paid after, and taxable yearsbeginning after, 1973, see section 5(e) of Pub. L 93-233, set out as an Effective Date of 1973 Amendmentnote under section 409 of Title 42, The Public Healthand Welfare.


EnmnCTvz DATE OF 1972 A mmEnT

Amendment by Pub. L, 92-336 applicable only withrespect to remuneration paid after December 1972, seesection 203(c) of Pub. L. 92-336, set out as an EffectiveDate of 1972 Amendment note under section 409 ofTitle 42.

ErncrvE DATE oF 1971 AmMI)nCrrAmendment by Pub. L. 92-5 applicable only with re-

spect to remuneration paid after Dec. 1971, see section203(c) of Pub. L 92-5, set out as an Effective Date of1971 Amendment note under section 409 of Title 42.

Ernc'rrv DATE or 1968 AwimwzT

Amendment by Pub. L. 90-248 applicable only withrespect to remuneration paid after December 1967, seesection 108(c) of Pub. L. 90-248, set out as an EffectiveDate of 1968 Amendment note under section 409 ofTitle 42.

Errnczivz DATE OF 1965 A N DM WT

Amendment by section 317 of Pub. L. 89-97 applica-ble with respect to services performed after the quar.ter ending September 30, 1965, and after the quarterin which the Secretary of the Treasury receives a cer-tification from the Commissioners of the District ofColumbia expressing their desire to have the insur-ance system established by section 401 et seq. and1395c et seq. of Title 42 extended to the officers andemployees coming under the provisions of suchamendments, see section 317(g) of Pub. L. 89-97, setout as an Effective Date of 1965 Amendment noteunder section 410 of Title 42.

Amendment by section 320 of Pub. L. 89-97 applica-ble with respect to remuneration paid after December1965, see section 320(c) of Pub. L. 89-97, set out as anEffective Date of 1965 Amendment note under section3121 of this title.

EFcTzvs DATE

Section applicable only with respect to (1) service inthe employ of the Government of Guam or any politi-cal subdivision theikeof, or any instrumentality of anyone or more of the foregoing wholly owned thereby,which is performed after 1960 and after the calendarquarter in which the Secretary of the Treasury re-ceives a certification by the Governor of Guam thatlegislation has been enacted by the Government ofGuam expressing its desire to have the insurancesystem established by title II of the Social SecurityAct, section 401 et seq. of Title 42, extended to the of-ficers and employees of such Government and suchpolitical subdivisions and instrumentalities, and (2)service in the employ of the Government of AmericanSamoa or any political subdivision thereof or any in-strumentality of any one or more of the foregoingwholly owned thereby, which is performed after 1960and after the calendar quarter in which the Secretaryof the Treasury receives a certification by the Gover-nor of American Samoa that the Government ofAmerican Samoa desires to have the insurance systemestablished by title II of the Social Security Act, sec-tion 401 et seq. of Title 42, extended to the officersand employees of such Government and such politicalsubdivisions and instrumentalities, see Section103(v)(1) of Pub. L 86-778, set out as an EffectiveDate of 1960 Amendment note under section 402 ofTitle 42.

SECTIoN REF MM TO IN Onnm SF=IoNs

This section is referred to in sections 6205, 6413 ofthis title; title 42 section 430.

§ 3126. Short title

This chapter may be cited as the "Federal In-surance Contributions Act."

(Aug. 16, 1954, ch. 136, 68A Stat. 429, § 3125, re-numbered Sept. 13, 1960, Pub. L. 86-778, title I,§ 103(q)(1), 74 Stat. 939.)

CHAPTER 22-RAILROAD RETIREMENT TAXACT

Subchapter Sec.'A. Tax on employees ................................................... 3201B. Tax on employee representatives ........................ 3211C. Tax on employers ................................................... 3221D. General provisions ................................................. 3231

'Section numbers editorially added for convenience of users.

Page 863 § 3126

Documents

United States Code: Federal Insurance Contributions Act