26 U.S.C. § 3121 : US Code - Section 3121: Definitions

Search 26 U.S.C. § 3121 : US Code - Section 3121: Definitions

    (a) Wages
      For purposes of this chapter, the term "wages" means all
    remuneration for employment, including the cash value of all
    remuneration (including benefits) paid in any medium other than
    cash; except that such term shall not include - 
        (1) in the case of the taxes imposed by sections 3101(a) and
      3111(a) that part of the remuneration which, after remuneration
      (other than remuneration referred to in the succeeding paragraphs
      of this subsection) equal to the contribution and benefit base
      (as determined under section 230 of the Social Security Act) with
      respect to employment has been paid to an individual by an
      employer during the calendar year with respect to which such
      contribution and benefit base is effective, is paid to such
      individual by such employer during such calendar year. If an
      employer (hereinafter referred to as successor employer) during
      any calendar year acquires substantially all the property used in
      a trade or business of another employer (hereinafter referred to
      as a predecessor), or used in a separate unit of a trade or
      business of a predecessor, and immediately after the acquisition
      employs in his trade or business an individual who immediately
      prior to the acquisition was employed in the trade or business of
      such predecessor, then, for the purpose of determining whether
      the successor employer has paid remuneration (other than
      remuneration referred to in the succeeding paragraphs of this
      subsection) with respect to employment equal to the contribution
      and benefit base (as determined under section 230 of the Social
      Security Act) to such individual during such calendar year, any
      remuneration (other than remuneration referred to in the
      succeeding paragraphs of this subsection) with respect to
      employment paid (or considered under this paragraph as having
      been paid) to such individual by such predecessor during such
      calendar year and prior to such acquisition shall be considered
      as having been paid by such successor employer;
        (2) the amount of any payment (including any amount paid by an
      employer for insurance or annuities, or into a fund, to provide
      for any such payment) made to, or on behalf of, an employee or
      any of his dependents under a plan or system established by an
      employer which makes provision for his employees generally (or
      for his employees generally and their dependents) or for a class
      or classes of his employees (or for a class or classes of his
      employees and their dependents), on account of - 
          (A) sickness or accident disability (but, in the case of
        payments made to an employee or any of his dependents, this
        subparagraph shall exclude from the term "wages" only payments
        which are received under a workman's compensation law), or
          (B) medical or hospitalization expenses in connection with
        sickness or accident disability, or
          (C) death, except that this paragraph does not apply to a
        payment for group-term life insurance to the extent that such
        payment is includible in the gross income of the employee;

        [(3) Repealed. Pub. L. 98-21, title III, Sec. 324(a)(3)(B),
      Apr. 20, 1983, 97 Stat. 123]
        (4) any payment on account of sickness or accident disability,
      or medical or hospitalization expenses in connection with
      sickness or accident disability, made by an employer to, or on
      behalf of, an employee after the expiration of 6 calendar months
      following the last calendar month in which the employee worked
      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 section 401(a) which is
        exempt from tax under section 501(a) at the time of such
        payment unless such payment is made to an employee of the trust
        as remuneration for services rendered as such employee and not
        as a beneficiary of the trust,
          (B) under or to an annuity plan which, at the time of such
        payment, is a plan described in section 403(a),
          (C) under a simplified employee pension (as defined in
        section 408(k)(1)), other than any contributions described in
        section 408(k)(6),
          (D) under or to an annuity contract described in section
        403(b), other than a payment for the purchase of such contract
        which is made by reason of a salary reduction agreement
        (whether evidenced by a written instrument or otherwise),
          (E) under or to an exempt governmental deferred compensation
        plan (as defined in subsection (v)(3)),
          (F) to supplement pension benefits under a plan or trust
        described in any of the foregoing provisions of this paragraph
        to take into account some portion or all of the increase in the
        cost of living (as determined by the Secretary of Labor) since
        retirement but only if such supplemental payments are under a
        plan which is treated as a welfare plan under section
        3(2)(B)(ii) of the Employee Retirement Income Security Act of
        1974,
          (G) under a cafeteria plan (within the meaning of section
        125) if such payment would not be treated as wages without
        regard to such plan and it is reasonable to believe that (if
        section 125 applied for purposes of this section) section 125
        would not treat any wages as constructively received,
          (H) under an arrangement to which section 408(p) applies,
        other than any elective contributions under paragraph (2)(A)(i)
        thereof, or
          (I) under a plan described in section 457(e)(11)(A)(ii) and
        maintained by an eligible employer (as defined in section
        457(e)(1));

        (6) the payment by an employer (without deduction from the
      remuneration of the employee) - 
          (A) of the tax imposed upon an employee under section 3101,
        or
          (B) of any payment required from an employee under a State
        unemployment compensation law,

      with respect to remuneration paid to an employee for domestic
      service in a private home of the employer or for agricultural
      labor;
        (7)(A) remuneration paid in any medium other than cash to an
      employee for service not in the course of the employer's trade or
      business or for domestic service in a private home of the
      employer;
        (B) cash remuneration paid by an employer in any calendar year
      to an employee for domestic service in a private home of the
      employer (including domestic service on a farm operated for
      profit), if the cash remuneration paid in such year by the
      employer to the employee for such service is less than the
      applicable dollar threshold (as defined in subsection (x)) for
      such year;
        (C) cash remuneration paid by an employer in any calendar year
      to an employee for service not in the course of the employer's
      trade or business, if the cash remuneration paid in such year by
      the employer to the employee for such service is less than $100.
      As used in this subparagraph, the term "service not in the course
      of the employer's trade or business" does not include domestic
      service in a private home of the employer and does not include
      service described in subsection (g)(5);
        (8)(A) remuneration paid in any medium other than cash for
      agricultural labor;
        (B) cash remuneration paid by an employer in any calendar year
      to an employee for agricultural labor unless - 
          (i) the cash remuneration paid in such year by the employer
        to the employee for such labor is $150 or more, or
          (ii) the employer's expenditures for agricultural labor in
        such year equal or exceed $2,500,

      except that clause (ii) shall not apply in determining whether
      remuneration paid to an employee constitutes "wages" under this
      section if such employee (I) is employed as a hand harvest
      laborer and is paid on a piece rate basis in an operation which
      has been, and is customarily and generally recognized as having
      been, paid on a piece rate basis in the region of employment,
      (II) commutes daily from his permanent residence to the farm on
      which he is so employed, and (III) has been employed in
      agriculture less than 13 weeks during the preceding calendar
      year;
        [(9) Repealed. Pub. L. 98-21, title III, Sec. 324(a)(3)(B),
      Apr. 20, 1983, 97 Stat. 123]
        (10) remuneration paid by an employer in any calendar year to
      an employee for service described in subsection (d)(3)(C)
      (relating to home workers), if the cash remuneration paid in such
      year by the employer to the employee for such service is less
      than $100;
        (11) remuneration paid to or on behalf of an employee if (and
      to the extent that) at the time of the payment of such
      remuneration it is reasonable to believe that a corresponding
      deduction is allowable under section 217 (determined without
      regard to section 274(n));
        (12)(A) tips paid in any medium other than cash;
        (B) cash tips received by an employee in any calendar month in
      the course of his employment by an employer unless the amount of
      such cash tips is $20 or more;
        (13) any payment or series of payments by an employer to an
      employee or any of his dependents which is paid - 
          (A) upon or after the termination of an employee's employment
        relationship because of (i) death, or (ii) retirement for
        disability, and
          (B) under a plan established by the employer which makes
        provision for his employees generally or a class or classes of
        his employees (or for such employees or class or classes of
        employees and their dependents),

      other than any such payment or series of payments which would
      have been paid if the employee's employment relationship had not
      been so terminated;
        (14) any payment made by an employer to a survivor or the
      estate of a former employee after the calendar year in which such
      employee died;
        (15) any payment made by an employer to an employee, if at the
      time such payment is made such employee is entitled to disability
      insurance benefits under section 223(a) of the Social Security
      Act and such entitlement commenced prior to the calendar year in
      which such payment is made, and if such employee did not perform
      any services for such employer during the period for which such
      payment is made;
        (16) remuneration paid by an organization exempt from income
      tax under section 501(a) (other than an organization described in
      section 401(a)) or under section 521 in any calendar year to an
      employee for service rendered in the employ of such organization,
      if the remuneration paid in such year by the organization to the
      employee for such service is less than $100;
        (17) any contribution, payment, or service provided by an
      employer which may be excluded from the gross income of an
      employee, his spouse, or his dependents, under the provisions of
      section 120 (relating to amounts received under qualified group
      legal services plans);
        (18) any payment made, or benefit furnished, to or for the
      benefit of an employee if at the time of such payment or such
      furnishing it is reasonable to believe that the employee will be
      able to exclude such payment or benefit from income under section
      127, 129, 134(b)(4), or 134(b)(5);
        (19) the value of any meals or lodging furnished by or on
      behalf of the employer if at the time of such furnishing it is
      reasonable to believe that the employee will be able to exclude
      such items from income under section 119;
        (20) any benefit provided to or on behalf of an employee if at
      the time such benefit is provided it is reasonable to believe
      that the employee will be able to exclude such benefit from
      income under section 74(c), 108(f)(4), 117, or 132;
        (21) in the case of a member of an Indian tribe, any
      remuneration on which no tax is imposed by this chapter by reason
      of section 7873 (relating to income derived by Indians from
      exercise of fishing rights);
        (22) remuneration on account of - 
          (A) a transfer of a share of stock to any individual pursuant
        to an exercise of an incentive stock option (as defined in
        section 422(b)) or under an employee stock purchase plan (as
        defined in section 423(b)), or
          (B) any disposition by the individual of such stock; or

        (23) any benefit or payment which is excludable from the gross
      income of the employee under section 139B(b).

    Nothing in the regulations prescribed for purposes of chapter 24
    (relating to income tax withholding) which provides an exclusion
    from "wages" as used in such chapter shall be construed to require
    a similar exclusion from "wages" in the regulations prescribed for
    purposes of this chapter. Except as otherwise provided in
    regulations prescribed by the Secretary, any third party which
    makes a payment included in wages solely by reason of the
    parenthetical matter contained in subparagraph (A) of paragraph (2)
    shall be treated for purposes of this chapter and chapter 22 as the
    employer with respect to such wages.
    (b) Employment
      For purposes of this chapter, the term "employment" means any
    service, of whatever nature, performed (A) by an employee for the
    person employing him, irrespective of the citizenship or residence
    of either, (i) within the United States, or (ii) on or in
    connection with an American vessel or American aircraft under a
    contract of service which is entered into within the United States
    or during the performance of which and while the employee is
    employed on the vessel or aircraft it touches at a port in the
    United States, if the employee is employed on and in connection
    with such vessel or aircraft when outside the United States, or (B)
    outside the United States by a citizen or resident of the United
    States as an employee for an American employer (as defined in
    subsection (h)), or (C) if it is service, regardless of where or by
    whom performed, which is designated as employment or recognized as
    equivalent to employment under an agreement entered into under
    section 233 of the Social Security Act; except that such term shall
    not include - 
        (1) service performed by foreign agricultural workers lawfully
      admitted to the United States from the Bahamas, Jamaica, and the
      other British West Indies, or from any other foreign country or
      possession thereof, on a temporary basis to perform agricultural
      labor;
        (2) domestic service performed in a local college club, or
      local chapter of a college fraternity or sorority, by a student
      who is enrolled and is regularly attending classes at a school,
      college, or university;
        (3)(A) service performed by a child under the age of 18 in the
      employ of his father or mother;
        (B) service not in the course of the employer's trade or
      business, or domestic service in a private home of the employer,
      performed by an individual under the age of 21 in the employ of
      his father or mother, or performed by an individual in the employ
      of his spouse or son or daughter; except that the provisions of
      this subparagraph shall not be applicable to such domestic
      service performed by an individual in the employ of his son or
      daughter if - 
          (i) the employer is a surviving spouse or a divorced
        individual and has not remarried, or has a spouse living in the
        home who has a mental or physical condition which results in
        such spouse's being incapable of caring for a son, daughter,
        stepson, or stepdaughter (referred to in clause (ii)) for at
        least 4 continuous weeks in the calendar quarter in which the
        service is rendered, and
          (ii) a son, daughter, stepson, or stepdaughter of such
        employer is living in the home, and
          (iii) the son, daughter, stepson, or stepdaughter (referred
        to in clause (ii)) has not attained age 18 or has a mental or
        physical condition which requires the personal care and
        supervision of an adult for at least 4 continuous weeks in the
        calendar quarter in which the service is rendered;

        (4) service performed by an individual on or in connection with
      a vessel not an American vessel, or on or in connection with an
      aircraft not an American aircraft, if (A) the individual is
      employed on and in connection with such vessel or aircraft, when
      outside the United States and (B)(i) such individual is not a
      citizen of the United States or (ii) the employer is not an
      American employer;
        (5) service performed in the employ of the United States or any
      instrumentality of the United States, if such service - 
          (A) would be excluded from the term "employment" for purposes
        of this title if the provisions of paragraphs (5) and (6) of
        this subsection as in effect in January 1983 had remained in
        effect, and
          (B) is performed by an individual who - 
            (i) has been continuously performing service described in
          subparagraph (A) since December 31, 1983, and for purposes of
          this clause - 
              (I) if an individual performing service described in
            subparagraph (A) returns to the performance of such service
            after being separated therefrom for a period of less than
            366 consecutive days, regardless of whether the period
            began before, on, or after December 31, 1983, then such
            service shall be considered continuous,
              (II) if an individual performing service described in
            subparagraph (A) returns to the performance of such service
            after being detailed or transferred to an international
            organization as described under section 3343 of subchapter
            III of chapter 33 of title 5, United States Code, or under
            section 3581 of chapter 35 of such title, then the service
            performed for that organization shall be considered service
            described in subparagraph (A),
              (III) if an individual performing service described in
            subparagraph (A) is reemployed or reinstated after being
            separated from such service for the purpose of accepting
            employment with the American Institute in Taiwan as
            provided under section 3310 of chapter 48 of title 22,
            United States Code, then the service performed for that
            Institute shall be considered service described in
            subparagraph (A),
              (IV) if an individual performing service described in
            subparagraph (A) returns to the performance of such service
            after performing service as a member of a uniformed service
            (including, for purposes of this clause, service in the
            National Guard and temporary service in the Coast Guard
            Reserve) and after exercising restoration or reemployment
            rights as provided under chapter 43 of title 38, United
            States Code, then the service so performed as a member of a
            uniformed service shall be considered service described in
            subparagraph (A), and
              (V) if an individual performing service described in
            subparagraph (A) returns to the performance of such service
            after employment (by a tribal organization) to which
            section 105(e)(2) (!1) of the Indian Self-Determination Act
            applies, then the service performed for that tribal
            organization shall be considered service described in
            subparagraph (A); or


            (ii) is receiving an annuity from the Civil Service
          Retirement and Disability Fund, or benefits (for service as
          an employee) under another retirement system established by a
          law of the United States for employees of the Federal
          Government (other than for members of the uniformed service);

      except that this paragraph shall not apply with respect to any
      such service performed on or after any date on which such
      individual performs - 
          (C) service performed as the President or Vice President of
        the United States,
          (D) service performed - 
            (i) in a position placed in the Executive Schedule under
          sections 5312 through 5317 of title 5, United States Code,
            (ii) as a noncareer appointee in the Senior Executive
          Service or a noncareer member of the Senior Foreign Service,
          or
            (iii) in a position to which the individual is appointed by
          the President (or his designee) or the Vice President under
          section 105(a)(1), 106(a)(1), or 107 (a)(1) or (b)(1) of
          title 3, United States Code, if the maximum rate of basic pay
          for such position is at or above the rate for level V of the
          Executive Schedule,

          (E) service performed as the Chief Justice of the United
        States, an Associate Justice of the Supreme Court, a judge of a
        United States court of appeals, a judge of a United States
        district court (including the district court of a territory), a
        judge of the United States Court of Federal Claims, a judge of
        the United States Court of International Trade, a judge of the
        United States Tax Court, a United States magistrate judge, or a
        referee in bankruptcy or United States bankruptcy judge,
          (F) service performed as a Member, Delegate, or Resident
        Commissioner of or to the Congress,
          (G) any other service in the legislative branch of the
        Federal Government if such service - 
            (i) is performed by an individual who was not subject to
          subchapter III of chapter 83 of title 5, United States Code,
          or to another retirement system established by a law of the
          United States for employees of the Federal Government (other
          than for members of the uniformed services), on December 31,
          1983, or
            (ii) is performed by an individual who has, at any time
          after December 31, 1983, received a lump-sum payment under
          section 8342(a) of title 5, United States Code, or under the
          corresponding provision of the law establishing the other
          retirement system described in clause (i), or
            (iii) is performed by an individual after such individual
          has otherwise ceased to be subject to subchapter III of
          chapter 83 of title 5, United States Code (without having an
          application pending for coverage under such subchapter),
          while performing service in the legislative branch
          (determined without regard to the provisions of subparagraph
          (B) relating to continuity of employment), for any period of
          time after December 31, 1983,

        and for purposes of this subparagraph (G) an individual is
        subject to such subchapter III or to any such other retirement
        system at any time only if (a) such individual's pay is subject
        to deductions, contributions, or similar payments (concurrent
        with the service being performed at that time) under section
        8334(a) of such title 5 or the corresponding provision of the
        law establishing such other system, or (in a case to which
        section 8332(k)(1) of such title applies) such individual is
        making payments of amounts equivalent to such deductions,
        contributions, or similar payments while on leave without pay,
        or (b) such individual is receiving an annuity from the Civil
        Service Retirement and Disability Fund, or is receiving
        benefits (for service as an employee) under another retirement
        system established by a law of the United States for employees
        of the Federal Government (other than for members of the
        uniformed services), or
          (H) service performed by an individual - 
            (i) on or after the effective date of an election by such
          individual, under section 301 of the Federal Employees'
          Retirement System Act of 1986, section 307 of the Central
          Intelligence Agency Retirement Act (50 U.S.C. 2157), or the
          Federal Employees' Retirement System Open Enrollment Act of
          1997 (!2) to become subject to the Federal Employees'
          Retirement System provided in chapter 84 of title 5, United
          States Code, or

            (ii) on or after the effective date of an election by such
          individual, under regulations issued under section 860 of the
          Foreign Service Act of 1980, to become subject to the Foreign
          Service Pension System provided in subchapter II of chapter 8
          of title I of such Act;

        (6) service performed in the employ of the United States or any
      instrumentality of the United States if such service is performed
      - 
          (A) in a penal institution of the United States by an inmate
        thereof;
          (B) by any individual as an employee included under section
        5351(2) of title 5, United States Code (relating to certain
        interns, student nurses, and other student employees of
        hospitals of the Federal Government), other than as a medical
        or dental intern or a medical or dental resident in training;
        or
          (C) by any individual as an employee serving on a temporary
        basis in case of fire, storm, earthquake, flood, or other
        similar emergency;

        (7) service performed in the employ of a State, or any
      political subdivision thereof, or any instrumentality of any one
      or more of the foregoing which is wholly owned thereby, except
      that this paragraph shall not apply in the case of - 
          (A) service which, under subsection (j), constitutes covered
        transportation service,
          (B) service in the employ of the Government of Guam or the
        Government of American Samoa or any political subdivision
        thereof, or of any instrumentality of any one or more of the
        foregoing which is wholly owned thereby, performed by an
        officer or employee thereof (including a member of the
        legislature of any such Government or political subdivision),
        and, for purposes of this title with respect to the taxes
        imposed by this chapter - 
            (i) any person whose service as such an officer or employee
          is not covered by a retirement system established by a law of
          the United States shall not, with respect to such service, be
          regarded as an employee of the United States or any agency or
          instrumentality thereof, and
            (ii) the remuneration for service described in clause (i)
          (including fees paid to a public official) shall be deemed to
          have been paid by the Government of Guam or the Government of
          American Samoa or by a political subdivision thereof or an
          instrumentality of any one or more of the foregoing which is
          wholly owned thereby, whichever is appropriate,

          (C) service performed in the employ of the District of
        Columbia or any instrumentality which is wholly owned thereby,
        if such service is not covered by a retirement system
        established by a law of the United States (other than the
        Federal Employees Retirement System provided in chapter 84 of
        title 5, United States Code); except that the provisions of
        this subparagraph shall not be applicable to service performed -
         
            (i) in a hospital or penal institution by a patient or
          inmate thereof;
            (ii) by any individual as an employee included under
          section 5351(2) of title 5, United States Code (relating to
          certain interns, student nurses, and other student employees
          of hospitals of the District of Columbia Government), other
          than as a medical or dental intern or as a medical or dental
          resident in training;
            (iii) by any individual as an employee serving on a
          temporary basis in case of fire, storm, snow, earthquake,
          flood or other similar emergency; or
            (iv) by a member of a board, committee, or council of the
          District of Columbia, paid on a per diem, meeting, or other
          fee basis,

          (D) service performed in the employ of the Government of Guam
        (or any instrumentality which is wholly owned by such
        Government) by an employee properly classified as a temporary
        or intermittent employee, if such service is not covered by a
        retirement system established by a law of Guam; except that (i)
        the provisions of this subparagraph shall not be applicable to
        services performed by an elected official or a member of the
        legislature or in a hospital or penal institution by a patient
        or inmate thereof, and (ii) for purposes of this subparagraph,
        clauses (i) and (ii) of subparagraph (B) shall apply,
          (E) service included under an agreement entered into pursuant
        to section 218 of the Social Security Act, or
          (F) service in the employ of a State (other than the District
        of Columbia, Guam, or American Samoa), of any political
        subdivision thereof, or of any instrumentality of any one or
        more of the foregoing which is wholly owned thereby, by an
        individual who is not a member of a retirement system of such
        State, political subdivision, or instrumentality, except that
        the provisions of this subparagraph shall not be applicable to
        service performed - 
            (i) by an individual who is employed to relieve such
          individual from unemployment;
            (ii) in a hospital, home, or other institution by a patient
          or inmate thereof;
            (iii) by any individual as an employee serving on a
          temporary basis in case of fire, storm, snow, earthquake,
          flood, or other similar emergency;
            (iv) by an election official or election worker if the
          remuneration paid in a calendar year for such service is less
          than $1,000 with respect to service performed during any
          calendar year commencing on or after January 1, 1995, ending
          on or before December 31, 1999, and the adjusted amount
          determined under section 218(c)(8)(B) of the Social Security
          Act for any calendar year commencing on or after January 1,
          2000, with respect to service performed during such calendar
          year; or
            (v) by an employee in a position compensated solely on a
          fee basis which is treated pursuant to section 1402(c)(2)(E)
          as a trade or business for purposes of inclusion of such fees
          in net earnings from self-employment;

        for purposes of this subparagraph, except as provided in
        regulations prescribed by the Secretary, the term "retirement
        system" has the meaning given such term by section 218(b)(4) of
        the Social Security Act;

        (8)(A) service performed by a duly ordained, commissioned, or
      licensed minister of a church in the exercise of his ministry or
      by a member of a religious order in the exercise of duties
      required by such order, except that this subparagraph shall not
      apply to service performed by a member of such an order in the
      exercise of such duties, if an election of coverage under
      subsection (r) is in effect with respect to such order, or with
      respect to the autonomous subdivision thereof to which such
      member belongs;
        (B) service performed in the employ of a church or qualified
      church-controlled organization if such church or organization has
      in effect an election under subsection (w), other than service in
      an unrelated trade or business (within the meaning of section
      513(a));
        (9) service performed by an individual as an employee or
      employee representative as defined in section 3231;
        (10) service performed in the employ of - 
          (A) a school, college, or university, or
          (B) an organization described in section 509(a)(3) if the
        organization is organized, and at all times thereafter is
        operated, exclusively for the benefit of, to perform the
        functions of, or to carry out the purposes of a school,
        college, or university and is operated, supervised, or
        controlled by or in connection with such school, college, or
        university, unless it is a school, college, or university of a
        State or a political subdivision thereof and the services
        performed in its employ by a student referred to in section
        218(c)(5) of the Social Security Act are covered under the
        agreement between the Commissioner of Social Security and such
        State entered into pursuant to section 218 of such Act;

      if such service is performed by a student who is enrolled and
      regularly attending classes at such school, college, or
      university;
        (11) service performed in the employ of a foreign government
      (including service as a consular or other officer or employee or
      a nondiplomatic representative);
        (12) service performed in the employ of an instrumentality
      wholly owned by a foreign government - 
          (A) if the service is of a character similar to that
        performed in foreign countries by employees of the United
        States Government or of an instrumentality thereof; and
          (B) if the Secretary of State shall certify to the Secretary
        of the Treasury that the foreign government, with respect to
        whose instrumentality and employees thereof exemption is
        claimed, grants an equivalent exemption with respect to similar
        service performed in the foreign country by employees of the
        United States Government and of instrumentalities thereof;

        (13) service performed as a student nurse in the employ of a
      hospital or a nurses' training school by an individual who is
      enrolled and is regularly attending classes in a nurses' training
      school chartered or approved pursuant to State law;
        (14)(A) service performed by an individual under the age of 18
      in the delivery or distribution of newspapers or shopping news,
      not including delivery or distribution to any point for
      subsequent delivery or distribution;
        (B) service performed by an individual in, and at the time of,
      the sale of newspapers or magazines to ultimate consumers, under
      an arrangement under which the newspapers or magazines are to be
      sold by him at a fixed price, his compensation being based on the
      retention of the excess of such price over the amount at which
      the newspapers or magazines are charged to him, whether or not he
      is guaranteed a minimum amount of compensation for such service,
      or is entitled to be credited with the unsold newspapers or
      magazines turned back;
        (15) service performed in the employ of an international
      organization, except service which constitutes "employment" under
      subsection (y);
        (16) service performed by an individual under an arrangement
      with the owner or tenant of land pursuant to which - 
          (A) such individual undertakes to produce agricultural or
        horticultural commodities (including livestock, bees, poultry,
        and fur-bearing animals and wildlife) on such land,
          (B) the agricultural or horticultural commodities produced by
        such individual, or the proceeds therefrom, are to be divided
        between such individual and such owner or tenant, and
          (C) the amount of such individual's share depends on the
        amount of the agricultural or horticultural commodities
        produced;

        (17) service in the employ of any organization which is
      performed (A) in any year during any part of which such
      organization is registered, or there is in effect a final order
      of the Subversive Activities Control Board requiring such
      organization to register, under the Internal Security Act of
      1950, as amended, as a Communist-action organization, a Communist-
      front organization, or a Communist-infiltrated organization, and
      (B) after June 30, 1956;
        (18) service performed in Guam by a resident of the Republic of
      the Philippines while in Guam on a temporary basis as a
      nonimmigrant alien admitted to Guam pursuant to section
      101(a)(15)(H)(ii) of the Immigration and Nationality Act (8
      U.S.C. 1101(a)(15)(H)(ii));
        (19) Service which is performed by a nonresident alien
      individual for the period he is temporarily present in the United
      States as a nonimmigrant under subparagraph (F), (J), (M), or (Q)
      of section 101(a)(15) of the Immigration and Nationality Act, as
      amended, and which is performed to carry out the purpose
      specified in subparagraph (F), (J), (M), or (Q), as the case may
      be;
        (20) service (other than service described in paragraph (3)(A))
      performed by an individual on a boat engaged in catching fish or
      other forms of aquatic animal life under an arrangement with the
      owner or operator of such boat pursuant to which - 
          (A) such individual does not receive any cash remuneration
        other than as provided in subparagraph (B) and other than cash
        remuneration - 
            (i) which does not exceed $100 per trip;
            (ii) which is contingent on a minimum catch; and
            (iii) which is paid solely for additional duties (such as
          mate, engineer, or cook) for which additional cash
          remuneration is traditional in the industry,

          (B) such individual receives a share of the boat's (or the
        boats' in the case of a fishing operation involving more than
        one boat) catch of fish or other forms of aquatic animal life
        or a share of the proceeds from the sale of such catch, and
          (C) the amount of such individual's share depends on the
        amount of the boat's (or the boats' in the case of a fishing
        operation involving more than one boat) catch of fish or other
        forms of aquatic animal life,

      but only if the operating crew of such boat (or each boat from
      which the individual receives a share in the case of a fishing
      operation involving more than one boat) is normally made up of
      fewer than 10 individuals; or
        (21) domestic service in a private home of the employer which -
      
          (A) is performed in any year by an individual under the age
        of 18 during any portion of such year; and
          (B) is not the principal occupation of such employee.

    For purposes of paragraph (20), the operating crew of a boat shall
    be treated as normally made up of fewer than 10 individuals if the
    average size of the operating crew on trips made during the
    preceding 4 calendar quarters consisted of fewer than 10
    individuals.
    (c) Included and excluded service
      For purposes of this chapter, if the services performed during
    one-half or more of any pay period by an employee for the person
    employing him constitute employment, all the services of such
    employee for such period shall be deemed to be employment; but if
    the services performed during more than one-half of any such pay
    period by an employee for the person employing him do not
    constitute employment, then none of the services of such employee
    for such period shall be deemed to be employment. As used in this
    subsection, the term "pay period" means a period (of not more than
    31 consecutive days) for which a payment of remuneration is
    ordinarily made to the employee by the person employing him. This
    subsection shall not be applicable with respect to services
    performed in a pay period by an employee for the person employing
    him, where any of such service is excepted by subsection (b)(9).
    (d) Employee
      For purposes of this chapter, the term "employee" means - 
        (1) any officer of a corporation; or
        (2) any individual who, under the usual common law rules
      applicable in determining the employer-employee relationship, has
      the status of an employee; or
        (3) any individual (other than an individual who is an employee
      under paragraph (1) or (2)) who performs services for
      remuneration for any person - 
          (A) as an agent-driver or commission-driver engaged in
        distributing meat products, vegetable products, fruit products,
        bakery products, beverages (other than milk), or laundry or dry-
        cleaning services, for his principal;
          (B) as a full-time life insurance salesman;
          (C) as a home worker performing work, according to
        specifications furnished by the person for whom the services
        are performed, on materials or goods furnished by such person
        which are required to be returned to such person or a person
        designated by him; or
          (D) as a traveling or city salesman, other than as an agent-
        driver or commission-driver, engaged upon a full-time basis in
        the solicitation on behalf of, and the transmission to, his
        principal (except for side-line sales activities on behalf of
        some other person) of orders from wholesalers, retailers,
        contractors, or operators of hotels, restaurants, or other
        similar establishments for merchandise for resale or supplies
        for use in their business operations;

      if the contract of service contemplates that substantially all of
      such services are to be performed personally by such individual;
      except that an individual shall not be included in the term
      "employee" under the provisions of this paragraph if such
      individual has a substantial investment in facilities used in
      connection with the performance of such services (other than in
      facilities for transportation), or if the services are in the
      nature of a single transaction not part of a continuing
      relationship with the person for whom the services are performed;
      or
        (4) any individual who performs services that are included
      under an agreement entered into pursuant to section 218 of the
      Social Security Act.
    (e) State, United States, and citizen
      For purposes of this chapter - 
      (1) State
        The term "State" includes the District of Columbia, the
      Commonwealth of Puerto Rico, the Virgin Islands, Guam, and
      American Samoa.
      (2) United States
        The term "United States" when used in a geographical sense
      includes the Commonwealth of Puerto Rico, the Virgin Islands,
      Guam, and American Samoa.

    An individual who is a citizen of the Commonwealth of Puerto Rico
    (but not otherwise a citizen of the United States) shall be
    considered, for purposes of this section, as a citizen of the
    United States.
    (f) American vessel and aircraft
      For purposes of this chapter, the term "American vessel" means
    any vessel documented or numbered under the laws of the United
    States; and includes any vessel which is neither documented or
    numbered under the laws of the United States nor documented under
    the laws of any foreign country, if its crew is employed solely by
    one or more citizens or residents of the United States or
    corporations organized under the laws of the United States or of
    any State; and the term "American aircraft" means an aircraft
    registered under the laws of the United States.
    (g) Agricultural labor
      For purposes of this chapter, the term "agricultural labor"
    includes all service performed - 
        (1) on a farm, in the employ of any person, in connection with
      cultivating the soil, or in connection with raising or harvesting
      any agricultural or horticultural commodity, including 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 or other operator of a
      farm, in connection with the operation, management, conservation,
      improvement, or maintenance of such farm and its tools and
      equipment, or in salvaging timber or clearing land of brush and
      other debris left by a hurricane, if the major part of such
      service is performed on a farm;
        (3) in connection with the production or harvesting of any
      commodity defined as an agricultural commodity in section 15(g)
      of the Agricultural Marketing Act, as amended (12 U.S.C. 1141j),
      or in connection with the ginning of cotton, or in connection
      with the operation or maintenance of ditches, canals, reservoirs,
      or waterways, not owned or operated for profit, used exclusively
      for supplying and storing water for farming purposes;
        (4)(A) in the employ of the operator of a farm in handling,
      planting, drying, packing, packaging, processing, freezing,
      grading, storing, or delivering to storage or to market or to a
      carrier for transportation to market, in its unmanufactured
      state, any agricultural or horticultural commodity; but only if
      such operator produced more than one-half of the commodity with
      respect to which such service is performed;
        (B) in the employ of a group of operators of farms (other than
      a cooperative organization) in the performance of service
      described in subparagraph (A), but only if such operators
      produced all of the commodity with respect to which such service
      is performed. For purposes of this subparagraph, any
      unincorporated group of operators shall be deemed a cooperative
      organization if the number of operators comprising such group is
      more than 20 at any time during the calendar year in which such
      service is performed;
        (C) the provisions of subparagraphs (A) and (B) shall not be
      deemed to be applicable with respect to service performed in
      connection with commercial canning or commercial freezing or in
      connection with any agricultural or horticultural commodity after
      its delivery to a terminal market for distribution for
      consumption; or
        (5) on a farm operated for profit if such service is not in the
      course of the employer's trade or business.

    As used in this subsection, the term "farm" includes stock, dairy,
    poultry, fruit, fur-bearing animal, and truck farms, plantations,
    ranches, nurseries, ranges, greenhouses or other similar structures
    used primarily for the raising of agricultural or horticultural
    commodities, and orchards.
    (h) American employer
      For purposes of this chapter, the term "American employer" means
    an employer which is - 
        (1) the United States or any instrumentality thereof,
        (2) an individual who is a resident of the United States,
        (3) a partnership, if two-thirds or more of the partners are
      residents of the United States,
        (4) a trust, if all of the trustees are residents of the United
      States, or
        (5) a corporation organized under the laws of 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 of domestic service
      described in subsection (a)(7)(B), any payment of cash
      remuneration for such service which is more or less than a whole-
      dollar amount shall, under such conditions and to such extent as
      may be prescribed by regulations made under this chapter, be
      computed to the nearest dollar. For the purpose of the
      computation to the nearest dollar, the payment of a fractional
      part of a dollar shall be disregarded unless it amounts to one-
      half dollar or more, in which case it shall be increased to $1.
      The amount of any payment of cash remuneration so computed to the
      nearest dollar shall, in lieu of the amount actually paid, be
      deemed to constitute the amount of cash remuneration for purposes
      of subsection (a)(7)(B).
      (2) Service in the uniformed services
        For purposes of this chapter, in the case of an individual
      performing service, as a member of a uniformed service, to which
      the provisions of subsection (m)(1) are applicable, the term
      "wages" shall, subject to the provisions of subsection (a)(1) of
      this section, include as such individual's remuneration for such
      service only (A) his basic pay as described in chapter 3 and
      section 1009 of title 37, United States Code, in the case of an
      individual performing service to which subparagraph (A) of such
      subsection (m)(1) applies, or (B) his compensation for such
      service as determined under section 206(a) of title 37, United
      States Code, in the case of an individual performing service to
      which subparagraph (B) of such subsection (m)(1) applies.
      (3) Peace Corps volunteer service
        For purposes of this chapter, in the case of an individual
      performing service, as a volunteer or volunteer leader within the
      meaning of the Peace Corps Act, to which the provisions of
      section 3121(p) are applicable, the term "wages" shall, subject
      to the provisions of subsection (a)(1) of this section, include
      as such individual's remuneration for such service only amounts
      paid pursuant to section 5(c) or 6(1) of the Peace Corps Act.
      (4) Service performed by certain members of religious orders
        For purposes of this chapter, in any case where an individual
      is a member of a religious order (as defined in subsection
      (r)(2)) performing service in the exercise of duties required by
      such order, and an election of coverage under subsection (r) is
      in effect with respect to such order or with respect to the
      autonomous subdivision thereof to which such member belongs, the
      term "wages" shall, subject to the provisions of subsection
      (a)(1), include as such individual's remuneration for such
      service the fair market value of any board, lodging, clothing,
      and other perquisites furnished to such member by such order or
      subdivision thereof or by any other person or organization
      pursuant to an agreement with such order or subdivision, except
      that the amount included as such individual's remuneration under
      this paragraph shall not be less than $100 a month.
      (5) Service performed by certain retired justices and judges
        For purposes of this chapter, in the case of an individual
      performing service under the provisions of section 294 of title
      28, United States Code (relating to assignment of retired
      justices and judges to active duty), the term "wages" shall not
      include any payment under section 371(b) of such title 28 which
      is received during the period of such service.
    (j) Covered transportation service
      For purposes of this chapter - 
      (1) Existing transportation systems - General rule
        Except as provided in paragraph (2), all service performed in
      the employ of a State or political subdivision in connection with
      its operation of a public transportation system shall constitute
      covered transportation service if any part of the transportation
      system was acquired from private ownership after 1936 and prior
      to 1951.
      (2) Existing transportation systems - Cases in which no
        transportation employees, or only certain employees, are
        covered
        Service performed in the employ of a State or political
      subdivision in connection with the operation of its public
      transportation system shall not constitute covered transportation
      service if - 
          (A) any part of the transportation system was acquired from
        private ownership after 1936 and prior to 1951, and
        substantially all service in connection with the operation of
        the transportation system was, on December 31, 1950, covered
        under a general retirement system providing benefits which, by
        reason of a provision of the State constitution dealing
        specifically with retirement systems of the State or political
        subdivisions thereof, cannot be diminished or impaired; or
          (B) no part of the transportation system operated by the
        State or political subdivision on December 31, 1950, was
        acquired from private ownership after 1936 and prior to 1951;

      except that if such State or political subdivision makes an
      acquisition after 1950 from private ownership of any part of its
      transportation system, then, in the case of any employee who - 
          (C) became an employee of such State or political subdivision
        in connection with and at the time of its acquisition after
        1950 of such part, and
          (D) prior to such acquisition rendered service in employment
        (including as employment service covered by an agreement under
        section 218 of the Social Security Act) in connection with the
        operation of such part of the transportation system acquired by
        the State or political subdivision,

      the service of such employee in connection with the operation of
      the transportation system shall constitute covered transportation
      service, commencing with the first day of the third calendar
      quarter following the calendar quarter in which the acquisition
      of such part took place, unless on such first day such service of
      such employee is covered by a general retirement system which
      does not, with respect to such employee, contain special
      provisions applicable only to employees described in subparagraph
      (C).
      (3) Transportation systems acquired after 1950
        All service performed in the employ of a State or political
      subdivision thereof in connection with its operation of a public
      transportation system shall constitute covered transportation
      service if the transportation system was not operated by the
      State or political subdivision prior to 1951 and, at the time of
      its first acquisition (after 1950) from private ownership of any
      part of its transportation system, the State or political
      subdivision did not have a general retirement system covering
      substantially all service performed in connection with the
      operation of the transportation system.
      (4) Definitions
        For purposes of this subsection - 
          (A) The term "general retirement system" means any pension,
        annuity, retirement, or similar fund or system established by a
        State or by a political subdivision thereof for employees of
        the State, political subdivision, or both; but such term shall
        not include such a fund or system which covers only service
        performed in positions connected with the operation of its
        public transportation system.
          (B) A transportation system or a part thereof shall be
        considered to have been acquired by a State or political
        subdivision from private ownership if prior to the acquisition
        service performed by employees in connection with the operation
        of the system or part thereof acquired constituted employment
        under this chapter or subchapter A of chapter 9 of the Internal
        Revenue Code of 1939 or was covered by an agreement made
        pursuant to section 218 of the Social Security Act and some of
        such employees became employees of the State or political
        subdivision in connection with and at the time of such
        acquisition.
          (C) The term "political subdivision" includes 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 political
          subdivisions.
    [(k) Repealed. Pub. L. 98-21, title I, Sec. 102(b)(2), Apr. 20,
      1983, 97 Stat. 71]
    (l) Agreements entered into by American employers with respect to
      foreign affiliates
      (1) Agreement with respect to certain employees of foreign
        affiliate
        The Secretary shall, at the American employer's request, enter
      into an agreement (in such manner and form as may be prescribed
      by the Secretary) with any American employer (as defined in
      subsection (h)) who desires to have the insurance system
      established by title II of the Social Security Act extended to
      service performed outside the United States in the employ of any
      1 or more of such employer's foreign affiliates (as defined in
      paragraph (6)) by all employees who are citizens or residents of
      the United States, except that the agreement shall not apply to
      any service performed by, or remuneration paid to, an employee if
      such service or remuneration would be excluded from the term
      "employment" or "wages", as defined in this section, had the
      service been performed in the United States. Such agreement may
      be amended at any time so as to be made applicable, in the same
      manner and under the same conditions, with respect to any other
      foreign affiliate of such American employer. Such agreement shall
      be applicable with respect to citizens or residents of the United
      States who, on or after the effective date of the agreement, are
      employees of and perform services outside the United States for
      any foreign affiliate specified in the agreement. Such agreement
      shall provide - 
          (A) that the American employer shall pay to the Secretary, at
        such time or times as the Secretary may by regulations
        prescribe, amounts equivalent to the sum of the taxes which
        would be imposed by sections 3101 and 3111 (including amounts
        equivalent to the interest, additions to the taxes, additional
        amounts, and penalties which would be applicable) with respect
        to the remuneration which would be wages if the services
        covered by the agreement constituted employment as defined in
        this section; and
          (B) that the American employer will comply with such
        regulations relating to payments and reports as the Secretary
        may prescribe to carry out the purposes of this subsection.
      (2) Effective period of agreement
        An agreement entered into pursuant to paragraph (1) shall be in
      effect for the period beginning with the first day of the
      calendar quarter in which such agreement is entered into or the
      first day of the succeeding calendar quarter, as may be specified
      in the agreement; except that in case such agreement is amended
      to include the services performed for any other affiliate and
      such amendment is executed after the first month following the
      first calendar quarter for which the agreement is in effect, the
      agreement shall be in effect with respect to service performed
      for such other affiliate only after the calendar quarter in which
      such amendment is executed. Notwithstanding any other provision
      of this subsection, the period for which any such agreement is
      effective with respect to any foreign entity shall terminate at
      the end of any calendar quarter in which the foreign entity, at
      any time in such quarter, ceases to be a foreign affiliate as
      defined in paragraph (6).
      (3) No termination of agreement
        No agreement under this subsection may be terminated, either in
      its entirety or with respect to any foreign affiliate, on or
      after June 15, 1989.
      (4) Deposits in trust funds
        For purposes of section 201 of the Social Security Act,
      relating to appropriations to the Federal Old-Age and Survivors
      Insurance Trust Fund and the Federal Disability Insurance Trust
      Fund, such remuneration - 
          (A) paid for services covered by an agreement entered into
        pursuant to paragraph (1) as would be wages if the services
        constituted employment, and
          (B) as is reported to the Secretary pursuant to the
        provisions of such agreement or of the regulations issued under
        this subsection,

      shall be considered wages subject to the taxes imposed by this
      chapter.
      (5) Overpayments and underpayments
        (A) If more or less than the correct amount due under an
      agreement entered into pursuant to this subsection is paid with
      respect to any payment of remuneration, proper adjustments with
      respect to the amounts due under such agreement shall be made,
      without interest, in such manner and at such times as may be
      required by regulations prescribed by the Secretary.
        (B) If an overpayment cannot be adjusted under subparagraph
      (A), the amount thereof shall be paid by the Secretary, through
      the Fiscal Service of the Treasury Department, but only if a
      claim for such overpayment is filed with the Secretary within two
      years from the time such overpayment was made.
      (6) Foreign affiliate defined
        For purposes of this subsection and section 210(a) of the
      Social Security Act - 
        (A) In general
          A foreign affiliate of an American employer is any foreign
        entity in which such American employer has not less than a 10-
        percent interest.
        (B) Determination of 10-percent interest
          For purposes of subparagraph (A), an American employer has a
        10-percent interest in any entity if such employer has such an
        interest directly (or through one or more entities) - 
            (i) in the case of a corporation, in the voting stock
          thereof, and
            (ii) in the case of any other entity, in the profits
          thereof.
      (7) American employer as separate entity
        Each American employer which enters into an agreement pursuant
      to paragraph (1) of this subsection shall, for purposes of this
      subsection and section 6413(c)(2)(C), relating to special refunds
      in the case of employees of certain foreign entities, be
      considered an employer in its capacity as a party to such
      agreement separate and distinct from its identity as a person
      employing individuals on its own account.
      (8) Regulations
        Regulations of the Secretary to carry out the purposes of this
      subsection shall be designed to make the requirements imposed on
      American employers with respect to services covered by an
      agreement entered into pursuant to this subsection the same, so
      far as practicable, as those imposed upon employers pursuant to
      this title with respect to the taxes imposed by this chapter.
    (m) Service in the uniformed services
      For purposes of this chapter - 
      (1) Inclusion of service
        The term "employment" shall, notwithstanding the provisions of
      subsection (b) of this section, include - 
          (A) service performed by an individual as a member of a
        uniformed service on active duty, but such term shall not
        include any such service which is performed while on leave
        without pay, and
          (B) service performed by an individual as a member of a
        uniformed service on inactive duty training.
      (2) Active duty
        The term "active duty" means "active duty" as described in
      paragraph (21) of section 101 of title 38, United States Code,
      except that it shall also include "active duty for training" as
      described in paragraph (22) of such section.
      (3) Inactive duty training
        The term "inactive duty training" means "inactive duty
      training" as described in paragraph (23) of such section 101.
    (n) Member of a uniformed service
      For purposes of this chapter, the term "member of a uniformed
    service" means any person appointed, enlisted, or inducted in a
    component of the Army, Navy, Air Force, Marine Corps, or Coast
    Guard (including a reserve component as defined in section 101(27)
    of title 38, United States Code), or in one of those services
    without specification of component, or as a commissioned officer of
    the Coast and Geodetic Survey, the National Oceanic and Atmospheric
    Administration Corps, or the Regular or Reserve Corps of the Public
    Health Service, and any person serving in the Army or Air Force
    under call or conscription. The term includes - 
        (1) a retired member of any of those services;
        (2) a member of the Fleet Reserve or Fleet Marine Corps
      Reserve;
        (3) a cadet at the United States Military Academy, a midshipman
      at the United States Naval Academy, and a cadet at the United
      States Coast Guard Academy or United States Air Force Academy;
        (4) a member of the Reserve Officers' Training Corps, the Naval
      Reserve Officers' Training Corps, or the Air Force Reserve
      Officers' Training Corps, when ordered to annual training duty
      for fourteen days or more, and while performing authorized travel
      to and from that duty; and
        (5) any person while en route to or from, or at, a place for
      final acceptance or for entry upon active duty in the military,
      naval, or air service - 
          (A) who has been provisionally accepted for such duty; or
          (B) who, under the Military Selective Service Act, has been
        selected for active military, naval, or air service;

      and has been ordered or directed to proceed to such place.

    The term does not include a temporary member of the Coast Guard
    Reserve.
    (o) Crew leader
      For purposes of this chapter, the term "crew leader" means an
    individual who furnishes individuals to perform agricultural labor
    for another person, if such individual pays (either on his own
    behalf or on behalf of such person) the individuals so furnished by
    him for the agricultural labor performed by them and if such
    individual has not entered into a written agreement with such
    person whereby such individual has been designated as an employee
    of such person; and such individuals furnished by the crew leader
    to perform agricultural labor for another person shall be deemed to
    be the employees of such crew leader. For purposes of this chapter
    and chapter 2, a crew leader shall, with respect to service
    performed in furnishing individuals to perform agricultural labor
    for another person and service performed as a member of the crew,
    be deemed not to be an employee of such other person.
    (p) Peace Corps volunteer service
      For purposes of this chapter, the term "employment" shall,
    notwithstanding the provisions of subsection (b) of this section,
    include service performed by an individual as a volunteer or
    volunteer leader within the meaning of the Peace Corps Act.
    (q) Tips included for both employee and employer taxes
      For purposes of this chapter, tips received by an employee in the
    course of his employment shall be considered remuneration for such
    employment (and deemed to have been paid by the employer for
    purposes of subsections (a) and (b) of section 3111). Such
    remuneration shall be deemed to be paid at the time a written
    statement including such tips is furnished to the employer pursuant
    to section 6053(a) or (if no statement including such tips is so
    furnished) at the time received; except that, in determining the
    employer's liability in connection with the taxes imposed by
    section 3111 with respect to such tips in any case where no
    statement including such tips was so furnished (or to the extent
    that the statement so furnished was inaccurate or incomplete), such
    remuneration shall be deemed for purposes of subtitle F to be paid
    on the date on which notice and demand for such taxes is made to
    the employer by the Secretary.
    (r) Election of coverage by religious orders
      (1) Certificate of election by order
        A religious order whose members are required to take a vow of
      poverty, or any autonomous subdivision of such order, may file a
      certificate (in such form and manner, and with such official, as
      may be prescribed by regulations under this chapter) electing to
      have the insurance system established by title II of the Social
      Security Act extended to services performed by its members in the
      exercise of duties required by such order or such subdivision
      thereof. Such certificate of election shall provide that - 
          (A) such election of coverage by such order or subdivision
        shall be irrevocable;
          (B) such election shall apply to all current and future
        members of such order, or in the case of a subdivision thereof
        to all current and future members of such order who belong to
        such subdivision;
          (C) all services performed by a member of such an order or
        subdivision in the exercise of duties required by such order or
        subdivision shall be deemed to have been performed by such
        member as an employee of such order or subdivision; and
          (D) the wages of each member, upon which such order or
        subdivision shall pay the taxes imposed by sections 3101 and
        3111, will be determined as provided in subsection (i)(4).
      (2) Definition of member
        For purposes of this subsection, a member of a religious order
      means any individual who is subject to a vow of poverty as a
      member of such order and who performs tasks usually required (and
      to the extent usually required) of an active member of such order
      and who is not considered retired because of old age or total
      disability.
      (3) Effective date for election
        (A) A certificate of election of coverage shall be in effect,
      for purposes of subsection (b)(8) and for purposes of section
      210(a)(8) of the Social Security Act, for the period beginning
      with whichever of the following may be designated by the order or
      subdivision thereof:
          (i) the first day of the calendar quarter in which the
        certificate is filed,
          (ii) the first day of the calendar quarter succeeding such
        quarter, or
          (iii) the first day of any calendar quarter preceding the
        calendar quarter in which the certificate is filed, except that
        such date may not be earlier than the first day of the
        twentieth calendar quarter preceding the quarter in which such
        certificate is filed.

      Whenever a date is designated under clause (iii), the election
      shall apply to services performed before the quarter in which the
      certificate is filed only if the member performing such services
      was a member at the time such services were performed and is
      living on the first day of the quarter in which such certificate
      is filed.
        (B) If a certificate of election filed pursuant to this
      subsection is effective for one or more calendar quarters prior
      to the quarter in which such certificate is filed, then - 
          (i) for purposes of computing interest and for purposes of
        section 6651 (relating to addition to tax for failure to file
        tax return), the due date for the return and payment of the tax
        for such prior calendar quarters resulting from the filing of
        such certificate shall be the last day of the calendar month
        following the calendar quarter in which the certificate is
        filed; and
          (ii) the statutory period for the assessment of such tax
        shall not expire before the expiration of 3 years from such due
        date.
      [(4) Repealed. Pub. L. 98-21, title I, Sec. 102(b)(3)(B), Apr.
        20, 1983, 97 Stat. 71]
    (s) Concurrent employment by two or more employers
      For purposes of sections 3102, 3111, and 3121(a)(1), if two or
    more related corporations concurrently employ the same individual
    and compensate such individual through a common paymaster which is
    one of such corporations, each such corporation shall be considered
    to have paid as remuneration to such individual only the amounts
    actually disbursed by it to such individual and shall not be
    considered to have paid as remuneration to such individual amounts
    actually disbursed to such individual by another of such
    corporations.
    [(t) Repealed. Pub. L. 100-203, title IX, Sec. 9006(b)(2), Dec. 22,
      1987, 101 Stat. 1330-289]
    (u) Application of hospital insurance tax to Federal, State, and
      local employment
      (1) Federal employment
        For purposes of the taxes imposed by sections 3101(b) and
      3111(b), subsection (b) shall be applied without regard to
      paragraph (5) thereof.
      (2) State and local employment
        For purposes of the taxes imposed by sections 3101(b) and
      3111(b) - 
        (A) In general
          Except as provided in subparagraphs (B) and (C), subsection
        (b) shall be applied without regard to paragraph (7) thereof.
        (B) Exception for certain services
          Service shall not be treated as employment by reason of
        subparagraph (A) if - 
            (i) the service is included under an agreement under
          section 218 of the Social Security Act, or
            (ii) the service is performed - 
              (I) by an individual who is employed by a State or
            political subdivision thereof to relieve him from
            unemployment,
              (II) in a hospital, home, or other institution by a
            patient or inmate thereof as an employee of a State or
            political subdivision thereof or of the District of
            Columbia,
              (III) by an individual, as an employee of a State or
            political subdivision thereof or of the District of
            Columbia, serving on a temporary basis in case of fire,
            storm, snow, earthquake, flood or other similar emergency,
              (IV) by any individual as an employee included under
            section 5351(2) of title 5, United States Code (relating to
            certain interns, student nurses, and other student
            employees of hospitals of the District of Columbia
            Government), other than as a medical or dental intern or a
            medical or dental resident in training,
              (V) by an election official or election worker if the
            remuneration paid in a calendar year for such service is
            less than $1,000 with respect to service performed during
            any calendar year commencing on or after January 1, 1995,
            ending on or before December 31, 1999, and the adjusted
            amount determined under section 218(c)(8)(B) of the Social
            Security Act for any calendar year commencing on or after
            January 1, 2000, with respect to service performed during
            such calendar year, or
              (VI) by an individual in a position described in section
            1402(c)(2)(E).

        As used in this subparagraph, the terms "State" and "political
        subdivision" have the meanings given those terms in section
        218(b) of the Social Security Act.
        (C) Exception for current employment which continues
          Service performed for an employer shall not be treated as
        employment by reason of subparagraph (A) if - 
            (i) such service would be excluded from the term
          "employment" for purposes of this chapter if subparagraph (A)
          did not apply;
            (ii) such service is performed by an individual - 
              (I) who was performing substantial and regular service
            for remuneration for that employer before April 1, 1986,
              (II) who is a bona fide employee of that employer on
            March 31, 1986, and
              (III) whose employment relationship with that employer
            was not entered into for purposes of meeting the
            requirements of this subparagraph; and

            (iii) the employment relationship with that employer has
          not been terminated after March 31, 1986.
        (D) Treatment of agencies and instrumentalities
          For purposes of subparagraph (C), under regulations - 
            (i) All agencies and instrumentalities of a State (as
          defined in section 218(b) of the Social Security Act) or of
          the District of Columbia shall be treated as a single
          employer.
            (ii) All agencies and instrumentalities of a political
          subdivision of a State (as so defined) shall be treated as a
          single employer and shall not be treated as described in
          clause (i).
      (3) Medicare qualified government employment
        For purposes of this chapter, the term "medicare qualified
      government employment" means service which - 
          (A) is employment (as defined in subsection (b)) with the
        application of paragraphs (1) and (2), but
          (B) would not be employment (as so defined) without the
        application of such paragraphs.
    (v) Treatment of certain deferred compensation and salary reduction
      arrangements
      (1) Certain employer contributions treated as wages
        Nothing in any paragraph of subsection (a) (other than
      paragraph (1)) shall exclude from the term "wages" - 
          (A) any employer contribution under a qualified cash or
        deferred arrangement (as defined in section 401(k)) to the
        extent not included in gross income by reason of section
        402(e)(3) or consisting of designated Roth contributions (as
        defined in section 402A(c)), or
          (B) any amount treated as an employer contribution under
        section 414(h)(2) where the pickup referred to in such section
        is pursuant to a salary reduction agreement (whether evidenced
        by a written instrument or otherwise).
      (2) Treatment of certain nonqualified deferred compensation plans
        (A) In general
          Any amount deferred under a nonqualified deferred
        compensation plan shall be taken into account for purposes of
        this chapter as of the later of - 
            (i) when the services are performed, or
            (ii) when there is no substantial risk of forfeiture of the
          rights to such amount.

        The preceding sentence shall not apply to any excess parachute
        payment (as defined in section 280G(b)) or to any specified
        stock compensation (as defined in section 4985) on which tax is
        imposed by section 4985.
        (B) Taxed only once
          Any amount taken into account as wages by reason of
        subparagraph (A) (and the income attributable thereto) shall
        not thereafter be treated as wages for purposes of this
        chapter.
        (C) Nonqualified deferred compensation plan
          For purposes of this paragraph, the term "nonqualified
        deferred compensation plan" means any plan or other arrangement
        for deferral of compensation other than a plan described in
        subsection (a)(5).
      (3) Exempt governmental deferred compensation plan
        For purposes of subsection (a)(5), the term "exempt
      governmental deferred compensation plan" means any plan providing
      for deferral of compensation established and maintained for its
      employees by the United States, by a State or political
      subdivision thereof, or by an agency or instrumentality of any of
      the foregoing. Such term shall not include - 
          (A) any plan to which section 83, 402(b), 403(c), 457(a), or
        457(f)(1) applies,
          (B) any annuity contract described in section 403(b), and
          (C) the Thrift Savings Fund (within the meaning of subchapter
        III of chapter 84 of title 5, United States Code).
    (w) Exemption of churches and qualified church-controlled
      organizations
      (1) General rule
        Any church or qualified church-controlled organization (as
      defined in paragraph (3)) may make an election within the time
      period described in paragraph (2), in accordance with such
      procedures as the Secretary determines to be appropriate, that
      services performed in the employ of such church or organization
      shall be excluded from employment for purposes of title II of the
      Social Security Act and this chapter. An election may be made
      under this subsection only if the church or qualified church-
      controlled organization states that such church or organization
      is opposed for religious reasons to the payment of the tax
      imposed under section 3111.
      (2) Timing and duration of election
        An election under this subsection must be made prior to the
      first date, more than 90 days after July 18, 1984, on which a
      quarterly employment tax return for the tax imposed under section
      3111 is due, or would be due but for the election, from such
      church or organization. An election under this subsection shall
      apply to current and future employees, and shall apply to service
      performed after December 31, 1983. The election may be revoked by
      the church or organization under regulations prescribed by the
      Secretary. The election shall be revoked by the Secretary if such
      church or organization fails to furnish the information required
      under section 6051 to the Secretary for a period of 2 years or
      more with respect to remuneration paid for such services by such
      church or organization, and, upon request by the Secretary, fails
      to furnish all such previously unfurnished information for the
      period covered by the election. Any revocation under the
      preceding sentence shall apply retroactively to the beginning of
      the 2-year period for which the information was not furnished.
      (3) Definitions
        (A) For purposes of this subsection, the term "church" means a
      church, a convention or association of churches, or an elementary
      or secondary school which is controlled, operated, or principally
      supported by a church or by a convention or association of
      churches.
        (B) For purposes of this subsection, the term "qualified church-
      controlled organization" means any church-controlled tax-exempt
      organization described in section 501(c)(3), other than an
      organization which - 
          (i) offers goods, services, or facilities for sale, other
        than on an incidental basis, to the general public, other than
        goods, services, or facilities which are sold at a nominal
        charge which is substantially less than the cost of providing
        such goods, services, or facilities; and
          (ii) normally receives more than 25 percent of its support
        from either (I) governmental sources, or (II) receipts from
        admissions, sales of merchandise, performance of services, or
        furnishing of facilities, in activities which are not unrelated
        trades or businesses, or both.
    (x) Applicable dollar threshold
      For purposes of subsection (a)(7)(B), the term "applicable dollar
    threshold" means $1,000. In the case of calendar years after 1995,
    the Commissioner of Social Security shall adjust such $1,000 amount
    at the same time and in the same manner as under section
    215(a)(1)(B)(ii) of the Social Security Act with respect to the
    amounts referred to in section 215(a)(1)(B)(i) of such Act, except
    that, for purposes of this paragraph, 1993 shall be substituted for
    the calendar year referred to in section 215(a)(1)(B)(ii)(II) of
    such Act. If any amount as adjusted under the preceding sentence is
    not a multiple of $100, such amount shall be rounded to the next
    lowest multiple of $100.
    (y) Service in the employ of international organizations by certain
      transferred Federal employees
      (1) In general
        For purposes of this chapter, service performed in the employ
      of an international organization by an individual pursuant to a
      transfer of such individual to such international organization
      pursuant to section 3582 of title 5, United States Code, shall
      constitute "employment" if - 
          (A) immediately before such transfer, such individual
        performed service with a Federal agency which constituted
        "employment" under subsection (b) for purposes of the taxes
        imposed by sections 3101(a) and 3111(a), and
          (B) such individual would be entitled, upon separation from
        such international organization and proper application, to
        reemployment with such Federal agency under such section 3582.
      (2) Definitions
        For purposes of this subsection - 
        (A) Federal agency
          The term "Federal agency" means an agency, as defined in
        section 3581(1) of title 5, United States Code.
        (B) International organization
          The term "international organization" has the meaning
        provided such term by section 3581(3) of title 5, United States
        Code.
    (z) Treatment of certain foreign persons as American employers
      (1) In general
        If any employee of a foreign person is performing services in
      connection with a contract between the United States Government
      (or any instrumentality thereof) and any member of any
      domestically controlled group of entities which includes such
      foreign person, such foreign person shall be treated for purposes
      of this chapter as an American employer with respect to such
      services performed by such employee.
      (2) Domestically controlled group of entities
        For purposes of this subsection - 
        (A) In general
          The term "domestically controlled group of entities" means a
        controlled group of entities the common parent of which is a
        domestic corporation.
        (B) Controlled group of entities
          The term "controlled group of entities" means a controlled
        group of corporations as defined in section 1563(a)(1), except
        that - 
            (i) "more than 50 percent" shall be substituted for "at
          least 80 percent" each place it appears therein, and
            (ii) the determination shall be made without regard to
          subsections (a)(4) and (b)(2) of section 1563.

        A partnership or any other entity (other than a corporation)
        shall be treated as a member of a controlled group of entities
        if such entity is controlled (within the meaning of section
        954(d)(3)) by members of such group (including any entity
        treated as a member of such group by reason of this sentence).
      (3) Liability of common parent
        In the case of a foreign person who is a member of any
      domestically controlled group of entities, the common parent of
      such group shall be jointly and severally liable for any tax
      under this chapter for which such foreign person is liable by
      reason of this subsection, and for any penalty imposed on such
      person by this title with respect to any failure to pay such tax
      or to file any return or statement with respect to such tax or
      wages subject to such tax. No deduction shall be allowed under
      this title for any liability imposed by the preceding sentence.
      (4) Provisions preventing double taxation
        (A) Agreements
          Paragraph (1) shall not apply to any services which are
        covered by an agreement under subsection (l).
        (B) Equivalent foreign taxation
          Paragraph (1) shall not apply to any services if the employer
        establishes to the satisfaction of the Secretary that the
        remuneration paid by such employer for such services is subject
        to a tax imposed by a foreign country which is substantially
        equivalent to the taxes imposed by this chapter.
      (5) Cross reference
          For relief from taxes in cases covered by certain
        international agreements, see sections 3101(c) and 3111(c).