and only if the Secretary of Health, Education, and Welfare finds that (C) such sect or division thereof has the established tenets or teachings referred to in the preceding sentence, (D) it is the practice, and has been for a period of time which he deems to be substantial, for members of such sect or division thereof to make provision for their dependent members which in his judgment is reasonable in view of their general level of living, and (E) such sect or division thereof has been in existence at all times since December 31, 1950. An exemption may not be granted to any individual if any benefit or other payment referred to in subparagraph (B) became payable (or, but for section 203 or 222 (b) of the Social Security Act, would have become payable) at or before the time of the filing of such waiver. (2) TIME FOR FILING APPLICATIONS.-For purposes of this subsection, an application must be filed on or before the time prescribed for filing the return (including any extension thereof) for the first taxable year for which the individual has self-employment income (determined without regard to this subsection or subsection (c) (6)), except that an application filed after such date but on or before the last day of the third calendar month following the calendar month in which the taxpayer is first notified in writing by the Secretary that a timely application for an exemption from the tax imposed by this chapter has not been filed by him shall be deemed to be filed timely.1 (3) PERIOD FOR WHICH EXEMPTION EFFECTIVE.-An exemption granted to any individual pursuant to this subsection shall apply with respect to all taxable years beginning after December 31, 1950, except that such exemption shall not apply for any taxable year (A) beginning (i) before the taxable year in which such individual first met the requirements of the first sentence of paragraph (1), or (ii) before the time as of which the Secretary of Health, Education, and Welfare finds that the sect or division thereof of which such individual is a member met the requirements of subparagraphs (C) and (D), or (B) ending (i) after the time such individual ceases to meet the requirements of the first sentence of paragraph (1), or (ii) after the time as of which the Secretary of Health, Education, and Welfare finds that the sect or division thereof 1 Paragraph (2) was amended by section 1901(a) (155) (C) of Public Law 94-455. of which he is a member ceases to meet the requirements of subparagraph (C) or (D). (4) APPLICATION BY FIDUCIARIES OR SURVIVORS.-In any case where an individual who has self-employment income dies before the expiration of the time prescribed by paragraph (2) for filing an application for exemption pursuant to this subsection, such an application may be filed with respect to such individual within such time by a fiduciary acting for such individual's estate or by such individual's survivor (within the meaning of section 205 (c) (1) (C) of the Social Security Act). Regular Basis (h) An individual shall be deemed to be self-employed on a regular basis in a taxable year, or to be a member of a partnership on a regular basis in such year, if he had net earnings from self-employment, as defined in the first sentence of subsection (a), of not less than $400 in at least two of the three consecutive taxable years immediately preceding such taxable year from trades or businesses carried on by such individual or such partnership.1 SEC. 1403. MISCELLANEOUS PROVISIONS. (a) TITLE OF CHAPTER.-This chapter may be cited as the "SelfEmployment Contributions Act of 1954". (b) CROSS REFERENCES. (1) For provisions relating to returns, see section 6017. (2) For provisions relating to collection of taxes in Virgin Islands, Guam, American Samoa, and Puerto Rico, see section 7651. (3) For provisions relating to declaration of estimated tax on self-employment income, see section 6015. SUBTITLE C-EMPLOYMENT TAXES Chapter 21. Federal insurance contributions act. Chapter 22. Railroad retirement tax act. Chapter 23. Federal unemployment tax act. Chapter 24. Collection of income tax at source on wages. Chapter 25. General provisions relating to employment taxes. CHAPTER 21-FEDERAL INSURANCE Subchapter A. Tax on employees. Subchapter B. Tax on employers. Subchapter C. General provisions. 1 Subsection (h) (formerly subsection (1)) was redesignated by section 1901 (a) (155) (B) of Public Law 94-455. (a) OLD-AGE, SURVIVORS, AND DISABILITY INSURANCE. In addition to other taxes, there is hereby imposed on the income of every individual a tax equal to the following percentages of the wages (as defined in section 3121(a)) received by him with respect to employment (as defined in section 3121 (b)) (1) with respect to wages received during the calendar years 1974 through 2010, the rate shall be 4.95 percent; and (2) with respect to wages received after December 31, 2010, the rate shall be 5.95 percent. (b) HOSPITAL INSURANCE.-In addition to the tax imposed by the preceding subsection, there is hereby imposed on the income of every individual a tax equal to the following percentages of the wages (as defined in section 3121 (a)) received by him with respect to employment (as defined in section 3121(b)) — (1) with respect to wages received during the calendar years 1974 through 1977, the rate shall be 0.90 percent; (2) with respect to wages received during the calendar years 1978 through 1980, the rate shall be 1.10 percent; (3) with respect to wages received during the calendar years 1981 through 1985, the rate shall be 1.35 percent: and (4) with respect to wages received after December 31, 1985, the rate shall be 1.50 percent. SEC. 3102. DEDUCTION OF TAX FROM WAGES. (a) REQUIREMENT.-The tax imposed by section 3101 shall be collected by the employer of the taxpayer, by deducting the amount of the tax from the wages as and when paid. An employer who in any calendar quarter pays to an employee cash remuneration to which paragraph (7) (B) or (C) or (10) of section 3121 (a) is applicable may deduct an amount equivalent to such tax from any such payment of remuneration, even though at the time of payment the total amount of such remuneration paid to the employee by the employer in the calendar quarter is less than $50; and an employer who in any calendar year pays to an employee cash remuneration to which paragraph (8) (B) of section 3121 (a) is applicable may deduct an amount equivalent to such tax from any such payment of remuneration, even though at the time of payment the total amount of such remuneration paid to the employee by the employer in the calendar year is less than $150 and the employee has not performed agricultural labor for the employer 1 Section 3101 was amended by section 1903(a)(1) of P.L. 94–455. on 20 days or more in the calendar year for cash remuneration computed on a time basis; and an employer who is furnished by an employee a written statement of tips (received in a calendar month) pursuant to section 6053 (a) to which paragraph (12)(B) of section 3121(a) is applicable may deduct an amount equivalent to such tax with respect to such tips from any wages of the employee (exclusive of tips) under his control, even though at the time such statement is furnished the total amount of the tips included in statements furnished to the employer as having been received by the employee in such calendar month in the course of his employment by such employer is less than $20. (b) INDEMNIFICATION OF EMPLOYER.-Every employer required so to deduct the tax shall be liable for the payment of such tax, and shall be indemnified against the claims and demands of any person for the amount of any such payment made by such employer. (c) SPECIAL RULE FOR TIPS. (1) In the case of tips which constitute wages, subsection (a) shall be applicable only to such tips as are included in a written statement furnished to the employer pursuant to section 6053 (a), and only to the extent that collection can be made by the employer, at or after the time such statement is so furnished and before the close of the 10th day following calendar month (or, if paragraph (3) applies, the 30th day following the quarter) in which the tips were deemed paid, by deducting the amount of the tax from such wages of the employee (excluding tips, but including funds turned over by the employee to the employer pursuant to paragraph (2)) as are under control of the employer. (2) If the tax imposed by section 3101, with respect to tips which are included in written statements furnished in any month to the employer pursuant to section 6053 (a), exceeds the wages of the employee (excluding tips) from which the employer is required to collect the tax under paragraph (1), the employee may furnish to the employer on or before the 10th day of the following month (or, if paragraph (3) applies, on or before the 30th day of the following quarter) an amount of money equal to the amount of the excess. (3) The Secretary may, under regulations prescribed by him, authorize employers (A) to estimate the amount of tips that will be reported by the employee pursuant to section 6053 (a) in any quarter of the calendar year, (B) to determine the amount to be deducted upon each payment of wages (exclusive of tips) during such quarter as if the tips so estimated constituted the actual tips so reported, and (C) to deduct upon any payment of wages (other than tips, but including funds turned over by the employee to the employer pursuant to paragraph (2)) to such employee during such quarter (and within 30 days thereafter) such amount as may be necessary to adjust the amount actually deducted upon such wages of the employee during the quarter to the amount required to be deducted in respect of tips included in written statements furnished to the employer during the quarter. (4) If the tax imposed by section 3101 with respect to tips which constitute wages exceeds the portion of such tax which can be collected by the employer from the wages of the employee pursuant to paragraph (1) or paragraph (3), such excess shall be paid by the employee. SUBCHAPTER B-TAX ON EMPLOYERS ** SEC. 3111. RATE OF TAX.1 (a) OLD-AGE, SURVIVORS, AND DISABILITY INSURANCE.-In addition to other taxes, there is hereby imposed on every employer an excise tax, with respect to having individuals in his employ, equal to the following percentages of the wages (as defined in section 3121(a)) paid by him with respect to employment (as defined in section 3121(b)) (1) with respect to wages paid during the calendar years 1974 through 2010, the rate shall be 4.95 percent; and (2) with respect to wages paid after December 31, 2010, the rate shall be 5.95 percent. (b) HOSPITAL INSURANCE.-In addition to the tax imposed by the preceding subsection, there is hereby imposed on every employer an excise tax, with respect to having individuals in his employ, equal to the following percentages of the wages (as defined in section 3121(a)) paid by him with respect to employment (as defined in section 3121 (b)) (1) with respect to wages paid during the calendar years 1974 through 1977, the rate shall be 0.90 percent; (2) with respect to wages paid during the calendar years 1978 through 1980, the rate shall be 1.10 percent; (3) with respect to wages paid during the calendar years 1981 through 1985, the rate shall be 1.35 percent; and 1 Section 3111 was amended by section 1903(a)(1) of P.L. 94-455. |