-CITE-
26 USC CHAPTER 25 - GENERAL PROVISIONS RELATING TO
EMPLOYMENT TAXES 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-MISC1-
Sec.
3501. Collection and payment of taxes.
3502. Nondeductibility of taxes in computing taxable income.
3503. Erroneous payments.
3504. Acts to be performed by agents.
3505. Liability of third parties paying or providing for
wages.
3506. Individuals providing companion sitting placement
services.
3507. Advance payment of earned income credit.
3508. Treatment of real estate agents and direct sellers.
3509. Determination of employer's liability for certain
employment taxes.
3510. Coordination of collection of domestic service
employment taxes with collection of income taxes.
AMENDMENTS
1994 - Pub. L. 103-387, Sec. 2(b)(2), Oct. 22, 1994, 108 Stat.
4074, added item 3510.
1990 - Pub. L. 101-508, title XI, Sec. 11801(b)(16), Nov. 5,
1990, 104 Stat. 1388-522, struck out item 3510 "Credit for
increased social security employee taxes and railroad retirement
tier 1 employee taxes imposed during 1984".
1983 - Pub. L. 98-67 repealed amendments made by section 307 of
Pub. L. 97-248. See 1982 Amendment note below.
Pub. L. 98-21, title I, Sec. 123(b)(2), Apr. 20, 1983, 97 Stat.
88, added item 3510.
1982 - Pub. L. 97-248, title II, Secs. 269(d), 270(b), Sept. 3,
1982, 96 Stat. 553, 554, added items 3508 and 3509.
Pub. L. 97-248, title III, Secs. 307(b)(5), 308(a), Sept. 3,
1982, 96 Stat. 591, provided that, applicable to payments of
interest, dividends, and patronage dividends paid or credited after
June 30, 1983, the caption of chapter 25 is amended by inserting
"AND COLLECTION OF INCOME TAXES AT SOURCE". Section 102(a), (b) of
Pub. L. 98-67, title I, Aug. 5, 1983, 97 Stat. 369, repealed
subtitle A (Secs. 301-308) of title III of Pub. L. 97-248 as of the
close of June 30, 1983, and provided that the Internal Revenue Code
of 1954 [now 1986] [this title] shall be applied and administered
(subject to certain exceptions) as if such subtitle A (and the
amendments made by such subtitle A) had not been enacted.
1978 - Pub. L. 95-600, title I, Sec. 105(b)(2), Nov. 6, 1978, 92
Stat. 2776, added item 3507.
1977 - Pub. L. 95-171, Sec. 10(b), Nov. 12, 1977, 91 Stat. 1356,
added item 3506.
1966 - Pub. L. 89-719, title I, Sec. 105(c), Nov. 2, 1966, 80
Stat. 1139, added item 3505.
-SECREF-
CHAPTER REFERRED TO IN OTHER SECTIONS
This chapter is referred to in title 48 section 1421i.
-End-
-CITE-
26 USC Sec. 3501 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3501. Collection and payment of taxes
-STATUTE-
(a) General rule
The taxes imposed by this subtitle shall be collected by the
Secretary and shall be paid into the Treasury of the United States
as internal-revenue collections.
(b) Taxes with respect to non-cash fringe benefits
The taxes imposed by this subtitle with respect to non-cash
fringe benefits shall be collected (or paid) by the employer at the
time and in the manner prescribed by the Secretary by regulations.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 471; Pub. L. 94-455, title XIX,
Sec. 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 98-369,
div. A, title V, Sec. 531(d)(5), July 18, 1984, 98 Stat. 885.)
-MISC1-
AMENDMENTS
1984 - Pub. L. 98-369 designated existing provisions as subsec.
(a), added heading, and added subsec. (b).
1976 - Pub. L. 94-455 struck out "or his delegate" after
"Secretary".
EFFECTIVE DATE OF 1984 AMENDMENT
Amendment by Pub. L. 98-369 effective Jan. 1, 1985, see section
531(h) of Pub. L. 98-369, set out as an Effective Date note under
section 132 of this title.
-End-
-CITE-
26 USC Sec. 3502 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3502. Nondeductibility of taxes in computing taxable income
-STATUTE-
(a) The taxes imposed by section 3101 of chapter 21, and by
sections 3201 and 3211 of chapter 22 shall not be allowed as a
deduction to the taxpayer in computing taxable income under
subtitle A.
(b) The tax deducted and withheld under chapter 24 shall not be
allowed as a deduction either to the employer or to the recipient
of the income in computing taxable income under subtitle A.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 471; Pub. L. 97-248, title III,
Secs. 305(b), 308(a), Sept. 3, 1982, 96 Stat. 588, 591; Pub. L.
98-67, title I, Sec. 102(a), Aug. 5, 1983, 97 Stat. 369.)
-MISC1-
AMENDMENTS
1983 - Subsecs. (b), (c). Pub. L. 98-67 repealed amendments made
by Pub. L. 97-248. See 1982 Amendment note below.
1982 - Subsecs. (b), (c). Pub. L. 97-248 provided that,
applicable to payments of interest, dividends, and patronage
dividends paid or credited after June 30, 1983, subsec. (b) is
amended and a new subsec. (c) is added. Section 102(a), (b) of Pub.
L. 98-67, title I, Aug. 5, 1983, 97 Stat. 369, repealed subtitle A
(Secs. 301-308) of title III of Pub. L. 97-248 as of the close of
June 30, 1983, and provided that the Internal Revenue Code of 1954
[now 1986] [this title] shall be applied and administered (subject
to certain exceptions) as if such subtitle A (and the amendments
made by such subtitle A) had not been enacted.
-End-
-CITE-
26 USC Sec. 3503 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3503. Erroneous payments
-STATUTE-
Any tax paid under chapter 21 or 22 by a taxpayer with respect to
any period with respect to which he is not liable to tax under such
chapter shall be credited against the tax, if any, imposed by such
other chapter upon the taxpayer, and the balance, if any, shall be
refunded.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 471.)
-End-
-CITE-
26 USC Sec. 3504 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3504. Acts to be performed by agents
-STATUTE-
In case a fiduciary, agent, or other person has the control,
receipt, custody, or disposal of, or pays the wages of an employee
or group of employees, employed by one or more employers, the
Secretary, under regulations prescribed by him, is authorized to
designate such fiduciary, agent, or other person to perform such
acts as are required of employers under this title and as the
Secretary may specify. Except as may be otherwise prescribed by the
Secretary, all provisions of law (including penalties) applicable
in respect of an employer shall be applicable to a fiduciary,
agent, or other person so designated but, except as so provided,
the employer for whom such fiduciary, agent, or other person acts
shall remain subject to the provisions of law (including penalties)
applicable in respect of employers.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 471; Pub. L. 85-866, title I,
Sec. 71, Sept. 2, 1958, 72 Stat. 1660; Pub. L. 94-455, title XIX,
Sec. 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834.)
-MISC1-
AMENDMENTS
1976 - Pub. L. 94-455 struck out "or his delegate" after
"Secretary" in three places.
1958 - Pub. L. 85-866 substituted "title" for "subtitle" in first
sentence.
EFFECTIVE DATE OF 1958 AMENDMENT
Section 71 of Pub. L. 85-866 provided that the amendment made by
that section is effective with respect to remuneration paid after
Dec. 31, 1954.
-End-
-CITE-
26 USC Sec. 3505 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3505. Liability of third parties paying or providing for wages
-STATUTE-
(a) Direct payment by third parties
For purposes of sections 3102, 3202, 3402, and 3403, if a lender,
surety, or other person, who is not an employer under such sections
with respect to an employee or group of employees, pays wages
directly to such an employee or group of employees, employed by one
or more employers, or to an agent on behalf of such employee or
employees, such lender, surety, or other person shall be liable in
his own person and estate to the United States in a sum equal to
the taxes (together with interest) required to be deducted and
withheld from such wages by such employer.
(b) Personal liability where funds are supplied
If a lender, surety, or other person supplies funds to or for the
account of an employer for the specific purpose of paying wages of
the employees of such employer, with actual notice or knowledge
(within the meaning of section 6323(i)(1)) that such employer does
not intend to or will not be able to make timely payment or deposit
of the amounts of tax required by this subtitle to be deducted and
withheld by such employer from such wages, such lender, surety, or
other person shall be liable in his own person and estate to the
United States in a sum equal to the taxes (together with interest)
which are not paid over to the United States by such employer with
respect to such wages. However, the liability of such lender,
surety, or other person shall be limited to an amount equal to 25
percent of the amount so supplied to or for the account of such
employer for such purpose.
(c) Effect of payment
Any amounts paid to the United States pursuant to this section
shall be credited against the liability of the employer.
-SOURCE-
(Added Pub. L. 89-719, title I, Sec. 105(a), Nov. 2, 1966, 80 Stat.
1138.)
-MISC1-
EFFECTIVE DATE
Section applicable only with respect to wages paid on or after
Jan. 1, 1967, see section 114(c)(1) of Pub. L. 89-719, set out as
an Effective Date of 1966 Amendment note under section 6323 of this
title.
-End-
-CITE-
26 USC Sec. 3506 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3506. Individuals providing companion sitting placement
services
-STATUTE-
(a) In general
For purposes of this subtitle, a person engaged in the trade or
business of putting sitters in touch with individuals who wish to
employ them shall not be treated as the employer of such sitters
(and such sitters shall not be treated as employees of such person)
if such person does not pay or receive the salary or wages of the
sitters and is compensated by the sitters or the persons who employ
them on a fee basis.
(b) Definition
For purposes of this section, the term "sitters" means
individuals who furnish personal attendance, companionship, or
household care services to children or to individuals who are
elderly or disabled.
(c) Regulations
The Secretary shall prescribe such regulations as may be
necessary to carry out the purpose of this section.
-SOURCE-
(Added Pub. L. 95-171, Sec. 10(a), Nov. 12, 1977, 91 Stat. 1356.)
-MISC1-
EFFECTIVE DATE
Section 10(c) of Pub. L. 95-171 provided that: "The amendments
made by this section [enacting this section] shall apply to
remuneration received after December 31, 1974."
UNEMPLOYMENT COMPENSATION OR SOCIAL SECURITY BENEFITS BASED ON
SERVICES PERFORMED BEFORE NOVEMBER 12, 1977, UNAFFECTED
Section 10(d) of Pub. L. 95-171 provided that: "The amendments
made by this section [enacting this section] shall not be construed
as affecting (1) any individual's right to receive unemployment
compensation based on services performed before the date of the
enactment of this Act [Nov. 12, 1977], or (2) any individual's
eligibility for social security benefits to the extent based on
services performed before that date."
-End-
-CITE-
26 USC Sec. 3507 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3507. Advance payment of earned income credit
-STATUTE-
(a) General rule
Except as otherwise provided in this section, every employer
making payment of wages to an employee with respect to whom an
earned income eligibility certificate is in effect shall, at the
time of paying such wages, make an additional payment to such
employee equal to such employee's earned income advance amount.
(b) Earned income eligibility certificate
For purposes of this title, an earned income eligibility
certificate is a statement furnished by an employee to the employer
which -
(1) certifies that the employee will be eligible to receive the
credit provided by section 32 for the taxable year,
(2) certifies that the employee has 1 or more qualifying
children (within the meaning of section 32(c)(3)) for such
taxable year,
(3) certifies that the employee does not have an earned income
eligibility certificate in effect for the calendar year with
respect to the payment of wages by another employer, and
(4) states whether or not the employee's spouse has an earned
income eligibility certificate in effect.
For purposes of this section, a certificate shall be treated as
being in effect with respect to a spouse if such a certificate will
be in effect on the first status determination date following the
date on which the employee furnishes the statement in question.
(c) Earned income advance amount
(1) In general
For purposes of this title, the term "earned income advance
amount" means, with respect to any payroll period, the amount
determined -
(A) on the basis of the employee's wages from the employer
for such period, and
(B) in accordance with tables prescribed by the Secretary.
In the case of an employee who is a member of the Armed Forces of
the United States, the earned income advance amount shall be
determined by taking into account such employee's earned income
as determined for purposes of section 32.
(2) Advance amount tables
The tables referred to in paragraph (1)(B) -
(A) shall be similar in form to the tables prescribed under
section 3402 and, to the maximum extent feasible, shall be
coordinated with such tables, and
(B) if the employee is not married, or if no earned income
eligibility certificate is in effect with respect to the spouse
of the employee, shall treat the credit provided by section 32
as if it were a credit -
(i) of not more than 60 percent of the credit percentage in
effect under section 32(b)(1) for an eligible individual with
1 qualifying child and with earned income not in excess of
the earned income amount in effect under section 32(b)(2) for
such an eligible individual, which
(ii) phases out at 60 percent of the phaseout percentage in
effect under section 32(b)(1) for such an eligible individual
between the phaseout amount in effect under section 32(b)(2)
for such an eligible individual and the amount of earned
income at which the credit under section 32(a) phases out for
such an eligible individual, or
(C) if an earned income eligibility certificate is in effect
with respect to the spouse of the employee, shall treat the
credit as if it were a credit determined under subparagraph (B)
by substituting 1/2 of the amounts of earned income described
in such subparagraph for such amounts.
(d) Payments to be treated as payments of withholding and FICA
taxes
(1) In general
For purposes of this title, payments made by an employer under
subsection (a) to his employees for any payroll period -
(A) shall not be treated as the payment of compensation, and
(B) shall be treated as made out of -
(i) amounts required to be deducted and withheld for the
payroll period under section 3401 (relating to wage
withholding), and
(ii) amounts required to be deducted for the payroll period
under section 3102 (relating to FICA employee taxes), and
(iii) amounts of the taxes imposed for the payroll period
under section 3111 (relating to FICA employer taxes),
as if the employer had paid to the Secretary, on the day on
which the wages are paid to the employees, an amount equal to
such payments.
(2) Advance payments exceed taxes due
In the case of any employer, if for any payroll period the
aggregate amount of earned income advance payments exceeds the
sum of the amounts referred to in paragraph (1)(B), each such
advance payment shall be reduced by an amount which bears the
same ratio to such excess as such advance payment bears to the
aggregate amount of all such advance payments.
(3) Employer may make full advance payments
The Secretary shall prescribe regulations under which an
employer may elect (in lieu of any application of paragraph (2))
-
(A) to pay in full all earned income advance amounts, and
(B) to have additional amounts paid by reason of this
paragraph treated as the advance payment of taxes imposed by
this title.
(4) Failure to make advance payments
For purposes of this title (including penalties), failure to
make any advance payment under this section at the time provided
therefor shall be treated as the failure at such time to deduct
and withhold under chapter 24 an amount equal to the amount of
such advance payment.
(e) Furnishing and taking effect of certificates
For purposes of this section -
(1) When certificate takes effect
(A) First certificate furnished
An earned income eligibility certificate furnished the
employer in cases in which no previous such certificate had
been in effect for the calendar year shall take effect as of
the beginning of the first payroll period ending, or the first
payment of wages made without regard to a payroll period, on or
after the date on which such certificate is so furnished (or if
later, the first day of the calendar year for which furnished).
(B) Later certificate
An earned income eligibility certificate furnished the
employer in cases in which a previous such certificate had been
in effect for the calendar year shall take effect with respect
to the first payment of wages made on or after the first status
determination date which occurs at least 30 days after the date
on which such certificate is so furnished, except that at the
election of the employer such certificate may be made effective
with respect to any payment of wages made on or after the date
on which such certificate is so furnished. For purposes of this
section, the term "status determination date" means January 1,
May 1, July 1, and October 1 of each year.
(2) Period during which certificate remains in effect
An earned income eligibility certificate which takes effect
under this section for any calendar year shall continue in effect
with respect to the employee during such calendar year until
revoked by the employee or until another such certificate takes
effect under this section.
(3) Change of status
(A) Requirement to revoke or furnish new certificate
If, after an employee has furnished an earned income
eligibility certificate under this section, there has been a
change of circumstances which has the effect of -
(i) making the employee ineligible for the credit provided
by section 32 for the taxable year, or
(ii) causing an earned income eligibility certificate to be
in effect with respect to the spouse of the employee,
the employee shall, within 10 days after such change in
circumstances, furnish the employer with a revocation of such
certificate or with a new certificate (as the case may be).
Such a revocation (or such a new certificate) shall take effect
under the rules provided by paragraph (1)(B) for a later
certificate and shall be made in such form as the Secretary
shall by regulations prescribe.
(B) Certificate no longer in effect
If, after an employee has furnished an earned income
eligibility certificate under this section which certifies that
such a certificate is in effect with respect to the spouse of
the employee, such a certificate is no longer in effect with
respect to such spouse, then the employee may furnish the
employer with a new earned income eligibility certificate.
(4) Form and contents of certificate
Earned income eligibility certificates shall be in such form
and contain such other information as the Secretary may by
regulations prescribe.
(5) Taxable year defined
The term "taxable year" means the last taxable year of the
employee under subtitle A beginning in the calendar year in which
the wages are paid.
(f) Internal Revenue Service notification
The Internal Revenue Service shall take such steps as may be
appropriate to ensure that taxpayers who have 1 or more qualifying
children and who receive a refund of the credit under section 32
are aware of the availability of earned income advance amounts
under this section.
-SOURCE-
(Added Pub. L. 95-600, title I, Sec. 105(b)(1), Nov. 6, 1978, 92
Stat. 2773; amended Pub. L. 97-248, title III, Secs. 307(a)(3),
308(a), Sept. 3, 1982, 96 Stat. 589, 591; Pub. L. 98-67, title I,
Sec. 102(a), Aug. 5, 1983, 97 Stat. 369; Pub. L. 98-369, div. A,
title IV, Sec. 474(r)(30), title X, Sec. 1042(d)(3), (4), July 18,
1984, 98 Stat. 845, 1044; Pub. L. 99-514, title I, Sec. 111(d)(2),
(3), Oct. 22, 1986, 100 Stat. 2108; Pub. L. 101-508, title XI, Sec.
11111(c), Nov. 5, 1990, 104 Stat. 1388-412; Pub. L. 103-66, title
XIII, Sec. 13131(d)(4)-(6), Aug. 10, 1993, 107 Stat. 435; Pub. L.
103-465, title VII, Sec. 721(c), Dec. 8, 1994, 108 Stat. 5002.)
-MISC1-
AMENDMENTS
1994 - Subsec. (c)(1). Pub. L. 103-465 inserted concluding
provisions.
1993 - Subsec. (b)(2) to (4). Pub. L. 103-66, Sec. 13131(d)(4),
added par. (2) and redesignated former pars. (2) and (3) as (3) and
(4), respectively.
Subsec. (c)(2)(B)(i), (ii). Pub. L. 103-66, Sec. 13131(d)(5),
added cls. (i) and (ii) and struck out former cls. (i) and (ii)
which read as follows:
"(i) of not more than the credit percentage under section
32(b)(1) (without regard to subparagraph (D) thereof) for an
eligible individual with 1 qualifying child and with earned income
not in excess of the amount of earned income taken into account
under section 32(a)(1), which
"(ii) phases out between the amount of earned income at which the
phaseout begins under section 32(b)(1)(B)(ii) and the amount of
income at which the credit under section 32(a)(1) phases out for an
eligible individual with 1 qualifying child, or".
Subsec. (f). Pub. L. 103-66, Sec. 13131(d)(6), added subsec. (f).
1990 - Subsec. (c)(2)(B), (C). Pub. L. 101-508 amended subpars.
(B) and (C) generally. Prior to amendment, subpars. (B) and (C)
read as follows:
"(B) if the employee is not married, or if no earned income
eligibility certificate is in effect with respect to the spouse of
the employee, shall treat the credit provided by section 32 as if
it were a credit -
"(i) of not more than 14 percent of earned income not in excess
of the amount of earned income taken into account under section
32(a), which
"(ii) phases out between the amount of earned income at which
the phaseout begins under subsection (b) of section 32 and the
amount of earned income at which the credit under section 32 is
phased out under such subsection, or
"(C) if an earned income eligibility certificate is in effect
with respect to the spouse of the employee, shall treat the credit
provided by section 32 as if it were a credit -
"(i) of not more than 14 percent of earned income not in excess
of 1/2 of the amount of earned income taken into account under
section 32(a), which
"(ii) phases out between amounts of earned income which are
1/2 of the amounts of earned income described in subparagraph
(B)(ii)."
1986 - Subsec. (c)(2)(B). Pub. L. 99-514, Sec. 111(d)(2), added
cls. (i) and (ii) and struck out former cls. (i) and (ii) which
read as follows:
"(i) of not more than 11 percent of the first $5,000 of earned
income, which
"(ii) phases out between $6,500 and $11,000 of earned income,
or".
Subsec. (c)(2)(C). Pub. L. 99-514, Sec. 111(d)(3), added cls. (i)
and (ii) and struck out former cls. (i) and (ii) which read as
follows:
"(i) of not more than 11 percent of the first $2,500 of earned
income, which
"(ii) phases out between $3,250 and $5,500 of earned income."
1984 - Subsec. (b)(1). Pub. L. 98-369, Sec. 474(r)(30),
substituted "section 32" for "section 43".
Subsec. (c)(2)(B). Pub. L. 98-369, Sec. 474(r)(30), substituted
"section 32" for "section 43" in provisions preceding cl. (i).
Subsec. (c)(2)(B)(i). Pub. L. 98-369, Sec. 1042(d)(3),
substituted "11 percent" for "10 percent".
Subsec. (c)(2)(B)(ii). Pub. L. 98-369, Sec. 1042(d)(3),
substituted "$6,500 and $11,000" for "$6,000 and $10,000".
Subsec. (c)(2)(C). Pub. L. 98-369, Sec. 474(r)(30), substituted
"section 32" for "section 43" in provisions preceding cl. (i).
Subsec. (c)(2)(C)(i). Pub. L. 98-369, Sec. 1042(d)(4),
substituted "11 percent" for "10 percent".
Subsec. (c)(2)(C)(ii). Pub. L. 98-369, Sec. 1042(d)(4),
substituted "$3,250 and $5,500" for "$3,000 and $5,000".
Subsec. (c)(3)(A)(i). Pub. L. 98-369, Sec. 474(r)(30),
substituted "section 32" for "section 43".
1983 - Subsec. (d)(4). Pub. L. 98-67 repealed amendments made by
Pub. L. 97-248. See 1982 Amendment note below.
1982 - Subsec. (d)(4). Pub. L. 97-248 provided that, applicable
to payments of interest, dividends, and patronage dividends paid or
credited after June 30, 1983, par. (4) is amended by inserting
"subchapter A of" before "chapter 24". Section 102(a), (b) of Pub.
L. 98-67, title I, Aug. 5, 1983, 97 Stat. 369, repealed subtitle A
(Secs. 301-308) of title III of Pub. L. 97-248 as of the close of
June 30, 1983, and provided that the Internal Revenue Code of 1954
[now 1986] [this title] shall be applied and administered (subject
to certain exceptions) as if such subtitle A (and the amendments
made by such subtitle A) had not been enacted.
EFFECTIVE DATE OF 1994 AMENDMENT
Section 721(d)(2) of Pub. L. 103-465 provided that: "The
amendments made by subsections (b) and (c) [amending this section
and section 6051 of this title] shall apply to remuneration paid
after December 31, 1994."
EFFECTIVE DATE OF 1993 AMENDMENT
Amendment by Pub. L. 103-66 applicable to taxable years beginning
after Dec. 31, 1993, see section 13131(e) of Pub. L. 103-66, set
out as a note under section 32 of this title.
EFFECTIVE DATE OF 1990 AMENDMENT
Amendment by Pub. L. 101-508 applicable to taxable years
beginning after Dec. 31, 1990, see section 11111(f) of Pub. L.
101-508, set out as a note under section 32 of this title.
EFFECTIVE DATE OF 1986 AMENDMENT
Amendment by Pub. L. 99-514 applicable to taxable years beginning
after Dec. 31, 1986, see section 151(a) of Pub. L. 99-514, set out
as a note under section 1 of this title.
EFFECTIVE DATE OF 1984 AMENDMENT
Amendment by section 474(r)(30) of Pub. L. 98-369 applicable to
taxable years beginning after Dec. 31, 1983, and to carrybacks from
such years, see section 475(a) of Pub. L. 98-369, set out as a note
under section 21 of this title.
Amendment by section 1042(d)(3), (4) of Pub. L. 98-369 applicable
to taxable years beginning after Dec. 31, 1984, see section 1042(e)
of Pub. L. 98-369, set out as a note under section 32 of this
title.
EFFECTIVE DATE
Section 105(g)(2) of Pub. L. 95-600, as amended by Pub. L.
96-222, title I, Sec. 101(a)(2)(D), Apr. 1, 1980, 94 Stat. 195,
provided that: "The amendments made by subsections (b), (c), and
(e) [enacting this section and amending sections 6051 and 6302 of
this title] shall apply to remuneration paid after June 30, 1979."
STUDY OF ADVANCE PAYMENTS
Section 11113 of title XI of Pub. L. 101-508 provided that:
"(a) In General. - The Comptroller General of the United States
shall, in consultation with the Secretary of the Treasury, conduct
a study of advance payments required by section 3507 of the
Internal Revenue Code of 1986 to determine -
"(1) the effectiveness of the advance payment system (including
an analysis of why so few employees take advantage of such
system), and
"(2) the manner in which such system can be implemented to
alleviate administrative complexity, if any, for small business,
and
"(3) if there are any other problems in the administration of
such system.
"(b) Report. - Not later than 1 year after the date of the
enactment of this title [Nov. 5, 1990], the Comptroller shall
report the results of the study conducted under subsection (a),
together with any recommendations, to the Committee on Finance of
the United States Senate and the Committee on Ways and Means of the
House of Representatives."
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 32, 6012, 6051, 6302 of
this title; title 7 section 2014; title 42 sections 653, 1382a,
1382b.
-End-
-CITE-
26 USC Sec. 3508 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3508. Treatment of real estate agents and direct sellers
-STATUTE-
(a) General rule
For purposes of this title, in the case of services performed as
a qualified real estate agent or as a direct seller -
(1) the individual performing such services shall not be
treated as an employee, and
(2) the person for whom such services are performed shall not
be treated as an employer.
(b) Definitions
For purposes of this section -
(1) Qualified real estate agent
The term "qualified real estate agent" means any individual who
is a sales person if -
(A) such individual is a licensed real estate agent,
(B) substantially all of the remuneration (whether or not
paid in cash) for the services performed by such individual as
a real estate agent is directly related to sales or other
output (including the performance of services) rather than to
the number of hours worked, and
(C) the services performed by the individual are performed
pursuant to a written contract between such individual and the
person for whom the services are performed and such contract
provides that the individual will not be treated as an employee
with respect to such services for Federal tax purposes.
(2) Direct seller
The term "direct seller" means any person if -
(A) such person -
(i) is engaged in the trade or business of selling (or
soliciting the sale of) consumer products to any buyer on a
buy-sell basis, a deposit-commission basis, or any similar
basis which the Secretary prescribes by regulations, for
resale (by the buyer or any other person) in the home or
otherwise than in a permanent retail establishment,
(ii) is engaged in the trade or business of selling (or
soliciting the sale of) consumer products in the home or
otherwise than in a permanent retail establishment, or
(iii) is engaged in the trade or business of the delivering
or distribution of newspapers or shopping news (including any
services directly related to such trade or business),
(B) substantially all the remuneration (whether or not paid
in cash) for the performance of the services described in
subparagraph (A) is directly related to sales or other output
(including the performance of services) rather than to the
number of hours worked, and
(C) the services performed by the person are performed
pursuant to a written contract between such person and the
person for whom the services are performed and such contract
provides that the person will not be treated as an employee
with respect to such services for Federal tax purposes.
(3) Coordination with retirement plans for selfemployed
This section shall not apply for purposes of subtitle A to the
extent that the individual is treated as an employee under
section 401(c)(1) (relating to self-employed individuals).
-SOURCE-
(Added Pub. L. 97-248, title II, Sec. 269(a), Sept. 3, 1982, 96
Stat. 551; amended Pub. L. 104-188, title I, Sec. 1118(a), Aug. 20,
1996, 110 Stat. 1764.)
-MISC1-
AMENDMENTS
1996 - Subsec. (b)(2)(A). Pub. L. 104-188 added cl. (iii).
EFFECTIVE DATE OF 1996 AMENDMENT
Section 1118(b) of Pub. L. 104-188 provided that: "The amendments
made by this section shall apply to services performed after
December 31, 1995."
EFFECTIVE DATE
Section 269(e) of Pub. L. 97-248 provided that:
"(1) In general. - Except as provided in paragraph (2), the
amendments made by this section [enacting this section and amending
section 410 of Title 42, The Public Health and Welfare] shall apply
to services performed after December 31, 1982.
"(2) Subsection (c). - The amendments made by subsection (c)
[amending provisions set out as a note under section 3401 of this
title] shall take effect on July 1, 1982."
RULES AND REGULATIONS
Section 269(c)(3) of Pub. L. 97-248 provided that: "Nothing in
section 530 of the Revenue Act of 1978 [set out as a note under
section 3401 of this title] shall be construed to prohibit the
implementation of the amendments made by this section [enacting
this section, amending section 410 of Title 42, The Public Health
and Welfare, and amending provisions set out as a note under
section 3401 of this title]."
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in title 42 section 410.
-End-
-CITE-
26 USC Sec. 3509 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3509. Determination of employer's liability for certain
employment taxes
-STATUTE-
(a) In general
If any employer fails to deduct and withhold any tax under
chapter 24 or subchapter A of chapter 21 with respect to any
employee by reason of treating such employee as not being an
employee for purposes of such chapter or subchapter, the amount of
the employer's liability for -
(1) Withholding taxes
Tax under chapter 24 for such year with respect to such
employee shall be determined as if the amount required to be
deducted and withheld were equal to 1.5 percent of the wages (as
defined in section 3401) paid to such employee.
(2) Employee social security tax
Taxes under subchapter A of chapter 21 with respect to such
employee shall be determined as if the taxes imposed under such
subchapter were 20 percent of the amount imposed under such
subchapter without regard to this subparagraph.
(b) Employer's liability increased where employer disregards
reporting requirements
(1) In general
In the case of an employer who fails to meet the applicable
requirements of section 6041(a), 6041A, or 6051 with respect to
any employee, unless such failure is due to reasonable cause and
not willful neglect, subsection (a) shall be applied with respect
to such employee -
(A) by substituting "3 percent" for "1.5 percent" in
paragraph (1); and
(B) by substituting "40 percent" for "20 percent" in
paragraph (2).
(2) Applicable requirements
For purposes of paragraph (1), the term "applicable
requirements" means the requirements described in paragraph (1)
which would be applicable consistent with the employer's
treatment of the employee as not being an employee for purposes
of chapter 24 or subchapter A of chapter 21.
(c) Section not to apply in cases of intentional disregard
This section shall not apply to the determination of the
employer's liability for tax under chapter 24 or subchapter A of
chapter 21 if such liability is due to the employer's intentional
disregard of the requirement to deduct and withhold such tax.
(d) Special rules
For purposes of this section -
(1) Determination of liability
If the amount of any liability for tax is determined under this
section -
(A) the employee's liability for tax shall not be affected by
the assessment or collection of the tax so determined,
(B) the employer shall not be entitled to recover from the
employee any tax so determined, and
(C) sections (!1) 3402(d) and section 6521 shall not apply.
(2) Section not to apply where employer deducts wage but not
social security taxes
This section shall not apply to any employer with respect to
any wages if -
(A) the employer deducted and withheld any amount of the tax
imposed by chapter 24 on such wages, but
(B) failed to deduct and withhold the amount of the tax
imposed by subchapter A of chapter 21 with respect to such
wages.
(3) Section not to apply to certain statutory employees
This section shall not apply to any tax under subchapter A of
chapter 21 with respect to an individual described in subsection
(d)(3) of section 3121 (without regard to whether such individual
is described in paragraph (1) or (2) of such subsection).
-SOURCE-
(Added Pub. L. 97-248, title II, Sec. 270(a), Sept. 3, 1982, 96
Stat. 553; amended Pub. L. 100-647, title II, Sec. 2003(d), Nov.
10, 1988, 102 Stat. 3598; Pub. L. 101-508, title V, Sec.
5130(a)(4), Nov. 5, 1990, 104 Stat. 1388-289.)
-MISC1-
AMENDMENTS
1990 - Subsec. (d)(3). Pub. L. 101-508 substituted "subsection
(d)(3)" for "subsection (d)(4)".
1988 - Subsec. (d)(3). Pub. L. 100-647 substituted "subsection
(d)(4)" for "subsection (d)(3)".
EFFECTIVE DATE OF 1990 AMENDMENT
Amendment by Pub. L. 101-508 effective as if included in the
enactment of Pub. L. 100-647, Sec. 2003(d), see section 5130(b) of
Pub. L. 101-508, set out as a note under section 1402 of this
title.
EFFECTIVE DATE
Section 270(c) of Pub. L. 97-248 provided that: "The amendment
made by this section [enacting this section] shall take effect on
the date of the enactment of this Act [Sept. 3, 1982], except that
such amendments shall not apply to any assessment made before
January 1, 1983."
-FOOTNOTE-
(!1) So in original. Probably should be "section".
-End-
-CITE-
26 USC Sec. 3510 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 25 - GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES
-HEAD-
Sec. 3510. Coordination of collection of domestic service
employment taxes with collection of income taxes
-STATUTE-
(a) General rule
Except as otherwise provided in this section -
(1) returns with respect to domestic service employment taxes
shall be made on a calendar year basis,
(2) any such return for any calendar year shall be filed on or
before the 15th day of the fourth month following the close of
the employer's taxable year which begins in such calendar year,
and
(3) no requirement to make deposits (or to pay installments
under section 6157) shall apply with respect to such taxes.
(b) Domestic service employment taxes subject to estimated tax
provisions
(1) In general
Solely for purposes of section 6654, domestic service
employment taxes imposed with respect to any calendar year shall
be treated as a tax imposed by chapter 2 for the taxable year of
the employer which begins in such calendar year.
(2) Employers not otherwise required to make estimated payments
Paragraph (1) shall not apply to any employer for any calendar
year if -
(A) no credit for wage withholding is allowed under section
31 to such employer for the taxable year of the employer which
begins in such calendar year, and
(B) no addition to tax would (but for this section) be
imposed under section 6654 for such taxable year by reason of
section 6654(e).
(3) Annualization
Under regulations prescribed by the Secretary, appropriate
adjustments shall be made in the application of section
6654(d)(2) in respect of the amount treated as tax under
paragraph (1).
(4) Transitional rule
In the case of any taxable year beginning before January 1,
1998, no addition to tax shall be made under section 6654 with
respect to any underpayment to the extent such underpayment was
created or increased by this section.
(c) Domestic service employment taxes
For purposes of this section, the term "domestic service
employment taxes" means -
(1) any taxes imposed by chapter 21 or 23 on remuneration paid
for domestic service in a private home of the employer, and
(2) any amount withheld from such remuneration pursuant to an
agreement under section 3402(p).
For purposes of this subsection, the term "domestic service in a
private home of the employer" includes domestic service described
in section 3121(g)(5).
(d) Exception where employer liable for other employment taxes
To the extent provided in regulations prescribed by the
Secretary, this section shall not apply to any employer for any
calendar year if such employer is liable for any tax under this
subtitle with respect to remuneration for services other than
domestic service in a private home of the employer.
(e) General regulatory authority
The Secretary shall prescribe such regulations as may be
necessary or appropriate to carry out the purposes of this section.
Such regulations may treat domestic service employment taxes as
taxes imposed by chapter 1 for purposes of coordinating the
assessment and collection of such employment taxes with the
assessment and collection of domestic employers' income taxes.
(f) Authority to enter into agreements to collect State
unemployment taxes
(1) In general
The Secretary is hereby authorized to enter into an agreement
with any State to collect, as the agent of such State, such
State's unemployment taxes imposed on remuneration paid for
domestic service in a private home of the employer. Any taxes to
be collected by the Secretary pursuant to such an agreement shall
be treated as domestic service employment taxes for purposes of
this section.
(2) Transfers to State account
Any amount collected under an agreement referred to in
paragraph (1) shall be transferred by the Secretary to the
account of the State in the Unemployment Trust Fund.
(3) Subtitle F made applicable
For purposes of subtitle F, any amount required to be collected
under an agreement under paragraph (1) shall be treated as a tax
imposed by chapter 23.
(4) State
For purposes of this subsection, the term "State" has the
meaning given such term by section 3306(j)(1).
-SOURCE-
(Added Pub. L. 103-387, Sec. 2(b)(1), Oct. 22, 1994, 108 Stat.
4073.)
-MISC1-
PRIOR PROVISIONS
A prior section 3510, added Pub. L. 98-21, title I, Sec.
123(b)(1), Apr. 20, 1983, 97 Stat. 88, provided a credit for
increased social security employee taxes and railroad retirement
tier 1 employee taxes imposed during 1984, prior to repeal by Pub.
L. 101-508, title XI, Sec. 11801(a)(42), Nov. 5, 1990, 104 Stat.
1388-521.
EFFECTIVE DATE
Section 2(b)(3) of Pub. L. 103-387 provided that: "The amendments
made by this subsection [enacting this section] shall apply to
remuneration paid in calendar years beginning after December 31,
1994."
EXPANDED INFORMATION TO EMPLOYERS
Section 2(b)(4) of Pub. L. 103-387 provided that: "The Secretary
of the Treasury or the Secretary's delegate shall prepare and make
available information on the Federal tax obligations of employers
with respect to employees performing domestic service in a private
home of the employer. Such information shall also include a
statement that such employers may have obligations with respect to
such employees under State laws relating to unemployment insurance
and workers compensation."
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in title 42 section 1320b-7.
-End-
-CITE-
26 USC Subtitle D - Miscellaneous Excise Taxes 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle D - Miscellaneous Excise Taxes
-HEAD-
Subtitle D - Miscellaneous Excise Taxes
-MISC1-
Chapter Sec.(!1)
31. Retail excise taxes 4001
32. Manufacturers excise taxes 4061
33. Facilities and services 4231
34. Documentary stamp taxes (!2) 4371
35. Taxes on wagering 4401
36. Certain other excise taxes 4451
[37. Repealed.]
38. Environmental taxes 4611
39. Registration-required obligations 4701
40. General provisions relating to occupational taxes 4901
41. Public charities 4911
42. Private foundations; and certain other tax-exempt
organizations 4940
43. Qualified pension, etc., plans 4971
44. Real estate investment trusts 4981
[45. Repealed.]
46. Golden parachute payments 4999
47. Certain group health plans 5000
AMENDMENTS
1990 - Pub. L. 101-508, title XI, Sec. 11801(b)(17), Nov. 5,
1990, 104 Stat. 1388-522, struck out item for chapter 37 "Sugar,
coconut and palm oil".
1989 - Pub. L. 101-239, title VI, Sec. 6202(b)(4)(B), title VII,
Sec. 7841(d)(4), Dec. 19, 1989, 103 Stat. 2233, 2428, substituted
semicolon for comma in item for chapter 42 and struck out "large"
after "Certain" in item for chapter 47.
1988 - Pub. L. 100-418, title I, Sec. 1941(b)(3)(A), Aug. 23,
1988, 102 Stat. 1324, struck out item for chapter 45 "Windfall
profit tax on domestic crude oil".
1987 - Pub. L. 100-203, title X, Sec. 10712(c)(8), Dec. 22, 1987,
101 Stat. 1330-467, substituted "and certain other tax-exempt
organizations" for "black lung benefit trusts" in item for chapter
42.
1986 - Pub. L. 99-509, title IX, Sec. 9319(d)(2), Oct. 21, 1986,
100 Stat. 2012, added item for chapter 47.
1984 - Pub. L. 98-369, div. A, title I, Sec. 67(d)(2), July 18,
1984, 98 Stat. 587, added item for chapter 46.
1983 - Pub. L. 97-424, title V, Sec. 512(b)(2)(B), Jan. 6, 1983,
96 Stat. 2177, substituted "Retail excise taxes" for "Special
fuels" in item for chapter 31.
1982 - Pub. L. 97-248, title III, Sec. 310(b)(4)(B), Sept. 3,
1982, 96 Stat. 598, added item for chapter 39.
1980 - Pub. L. 96-510, title II, Sec. 211(b), Dec. 11, 1980, 94
Stat. 2801, added item for chapter 38.
Pub. L. 96-223, Sec. 101(a)(2), Apr. 2, 1980, 94 Stat. 250, added
item for chapter 45.
1978 - Pub. L. 95-227, Sec. 4(c)(2)(C), Feb. 10, 1978, 92 Stat.
22, inserted ", black lung benefit trusts" after "foundations" in
item for chapter 42.
1976 - Pub. L. 94-455, title XIII, Sec. 1307(d)(3)(A), title XVI,
Sec. 1605(c), title XIX, Secs. 1904(b)(7)(E), (10)(G), 1952(n)(6),
Oct. 4, 1976, 90 Stat. 1728, 1755, 1815, 1818, 1846, substituted
"41. Public charities" for "41. Interest equalization tax" added
item for chapter 44 and struck out items for chapters "38. Import
taxes" and "39. Regulatory taxes".
1974 - Pub. L. 93-406, title II, Sec. 1016(b)(2), Sept. 2, 1974,
88 Stat. 932, added item for chapter 43.
1969 - Pub. L. 91-172, title I, Sec. 101(j)(59), Dec. 30, 1969,
83 Stat. 532, added item for chapter 42.
1964 - Pub. L. 88-563, Sec. 2(b), Sept. 2, 1964, 78 Stat. 841,
added item for chapter 41.
-SECREF-
SUBTITLE REFERRED TO IN OTHER SECTIONS
This subtitle is referred to in sections 6103, 6110, 6302, 6501,
6676, 6724, 7463, 7851 of this title.
-FOOTNOTE-
(!1) Section numbers editorially supplied.
(!2) Chapter heading amended by Pub. L. 94-455 without
corresponding amendment of analysis.
-End-
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