26 U.S.C. § 3306 — Definitions

Page 2809 TITLE 26—INTERNAL REVENUE CODE § 3306 (h) Requirement by State of contributions Any State may, as to service performed on ac- count of which contributions are made pursuant to subsection (g)— (1) require contributions from persons per- forming such service under its unemployment compensation law or temporary disability in- surance law administered in connection there- with, and (2) require general agents of the Secretary of Transportation to make contributions under such temporary disability insurance law and to make such deductions from wages or remu- neration as are required by such unemploy- ment compensation or temporary disability insurance law. (i) General agent as legal entity Each general agent of the Secretary of Trans- portation making contributions pursuant to subsection (g) or (h) shall, for purposes of such subsections, be considered a legal entity in his capacity as an instrumentality of the United States, separate and distinct from his identity as a person employing individuals on his own ac- count. (j) Denial of credits in certain cases Any person required, pursuant to the permis- sion granted by this section, to make contribu- tions to an unemployment fund under a State unemployment compensation law approved by the Secretary of Labor under section 3304 shall not be entitled to the credits permitted, with re- spect to the unemployment compensation law of a State, by subsections (a) and (b) of section 3302 against the tax imposed by section 3301 for any taxable year if, on October 31 of such taxable year, the Secretary of Labor certifies to the Sec- retary of the Treasury his finding, after reason- able notice and opportunity for hearing to the State agency, that the unemployment com- pensation law of such State is inconsistent with any one or more of the conditions on the basis of which such permission is granted or that, in the application of the State law with respect to the 12-month period ending on such October 31, there has been a substantial failure to comply with any one or more of such conditions. For purposes of section 3310, a finding of the Sec- retary of Labor under this subsection shall be treated as a finding under section 3304(c). (Aug. 16, 1954, ch. 736, 68A Stat. 445; Sept. 1, 1954, ch. 1212, § 4(c), 68 Stat. 1135; Pub. L. 86–778, title V, § 531(a), (b), Sept. 13, 1960, 74 Stat. 983; Pub. L. 91–373, title I, § 123, Aug. 10, 1970, 84 Stat. 702; Pub. L. 94–455, title XIX, §§ 1903(a)(15), 1906(b)(13)(C), Oct. 4, 1976, 90 Stat. 1809, 1834; Pub. L. 114–92, div. C, title XXXV, § 3503, Nov. 25, 2015, 129 Stat. 1219.) Editorial Notes AMENDMENTS 2015—Subsecs. (g), (h)(2), (i). Pub. L. 114–92 sub- stituted ‘‘Secretary of Transportation’’ for ‘‘Secretary of Commerce’’. 1976—Subsec. (g). Pub. L. 94–455, § 1903(a)(15)(A), struck out ‘‘on or after July 1, 1953,’’ after ‘‘respect to service performed’’. Subsec. (h). Pub. L. 94–455, 1903(a)(15)(B), struck out ‘‘on or after July 1, 1953, and’’ after ‘‘as to service per- formed’’. Subsec. (j). Pub. L. 94–455, §§ 1903(a)(15)(C), 1906(b)(13)(C), struck out ‘‘after December 31, 1971,’’ after ‘‘for any taxable year’’ and substituted ‘‘to the Secretary of the Treasury’’ for ‘‘to the Secretary’’. 1970—Subsec. (j). Pub. L. 91–373 added subsec. (j). 1960—Subsec. (b). Pub. L. 86–778, § 531(a), substituted ‘‘(other than an instrumentality to which section 3306(c)(6) applies)’’ for ‘‘except such as are (1) wholly owned by the United States, or (2) exempt from the tax imposed by section 3301 by virtue of any other provi- sion of law,’’ and added cl. (C). Subsec. (g). Pub. L. 86–778, § 531(b), substituted ‘‘nei- ther wholly nor partially’’ for ‘‘not wholly’’. 1954—Subsec. (e). Act Sept. 1, 1954, repealed subsec. (e) which related to the Bonneville Power Adminis- trator. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1960 AMENDMENT Pub. L. 86–778, title V, § 535, Sept. 13, 1960, 74 Stat. 985, provided that: ‘‘The amendments made by this part [part 3 (§§ 531–535) of title V of Pub. L. 86–778, enacting section 3308 and amending this section and section 3306 of this title] (other than the amendments made by sub- sections (e) and (f) of section 531 [amending sections 1361 and 1367 of Title 42, The Public Health and Wel- fare]) shall apply with respect to remuneration paid after 1961 for services performed after 1961. The amend- ments made by subsections (e) and (f) of section 531 shall apply with respect to any week of unemployment which begins after December 31, 1960.’’ [The second sen- tence of section 535 was repealed by Pub. L. 89–554, § 8(a), Sept. 6, 1966, 80 Stat. 661.] EFFECTIVE DATE OF 1954 AMENDMENT Act Sept. 1, 1954, ch. 1212, § 4(c), 68 Stat. 1135, provided that the amendment made by that section is effective with respect to services performed after Dec. 31, 1954. APPLICABILITY TO FEDERAL LAND BANKS, FEDERAL IN- TERMEDIATE CREDIT BANKS, AND BANKS FOR CO- OPERATIVES Pub. L. 86–778, title V, § 531(g), Sept. 13, 1960, 74 Stat. 984, as amended by Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ‘‘Notwithstanding section 203(b) of the Farm Credit Act of 1959, sections 3305(b), 3306(c)(6), and 3308 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954], and sections 1501(a) and 1507(a) of the Social Security Act [sections 1361(a) and 1367 of Title 42, The Public Health and Welfare] shall be appli- cable, according to their terms, to the Federal land banks, Federal intermediate credit banks, and banks for cooperatives.’’ § 3306. Definitions (a) Employer For purposes of this chapter— (1) In general The term ‘‘employer’’ means, with respect to any calendar year, any person who— (A) during any calendar quarter in the cal- endar year or the preceding calendar year paid wages of $1,500 or more, or (B) on each of some 20 days during the cal- endar year or during the preceding calendar year, each day being in a different calendar week, employed at least one individual in employment for some portion of the day. For purposes of this paragraph, there shall not be taken into account any wages paid to, or employment of, an employee performing do- mestic services referred to in paragraph (3). Page 2810 TITLE 26—INTERNAL REVENUE CODE § 3306 (2) Agricultural labor In the case of agricultural labor, the term ‘‘employer’’ means, with respect to any cal- endar year, any person who— (A) during any calendar quarter in the cal- endar year or the preceding calendar year paid wages of $20,000 or more for agricultural labor, or (B) on each of some 20 days during the cal- endar year or during the preceding calendar year, each day being in a different calendar week, employed at least 10 individuals in employment in agricultural labor for some portion of the day. (3) Domestic service In the case of domestic service in a private home, local college club, or local chapter of a college fraternity or sorority, the term ‘‘em- ployer’’ means, with respect to any calendar year, any person who during any calendar quarter in the calendar year or the preceding calendar year paid wages in cash of $1,000 or more for such service. (4) Special rule A person treated as an employer under para- graph (3) shall not be treated as an employer with respect to wages paid for any service other than domestic service referred to in paragraph (3) unless such person is treated as an employer under paragraph (1) or (2) with re- spect to such other service. (b) Wages For purposes of this chapter, the term ‘‘wages’’ means all remuneration for employ- ment, including the cash value of all remunera- tion (including benefits) paid in any medium other than cash; except that such term shall not include— (1) that part of the remuneration which, after remuneration (other than remuneration referred to in the succeeding paragraphs of this subsection) equal to $7,000 with respect to employment has been paid to an individual by an employer during any calendar year, is paid to such individual by such employer during such calendar year. If an employer (herein- after referred to as successor employer) during any calendar year acquires substantially all the property used in a trade or business of an- other employer (hereinafter referred to as a predecessor), or used in a separate unit of a trade or business of a predecessor, and imme- diately after the acquisition employs in his trade or business an individual who imme- diately 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 $7,000 to such individual during such calendar year, any re- muneration (other than remuneration referred to in the succeeding paragraphs of this sub- section) with respect to employment paid (or considered under this paragraph as having been paid) to such individual by such prede- cessor 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 gen- erally (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 work- men’s compensation law), or (B) medical or hospitalization expenses in connection with sickness or accident dis- ability, or (C) death; [(3) Repealed. Pub. L. 98–21, title III, § 324(b)(3)(B), Apr. 20, 1983, 97 Stat. 124] (4) any payment on account of sickness or accident disability, or medical or hospitaliza- tion expenses in connection with sickness or accident disability, made by an employer to, or on behalf of, an employee after the expira- tion 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 sec- tion 501(a) at the time of such payment un- less such payment is made to an employee of the trust as remuneration for services ren- dered as such employee and not as a bene- ficiary of the trust, or (B) under or to an annuity plan which, at the time of such payment, is a plan de- scribed 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 de- scribed in section 403(b), other than a pay- ment for the purchase of such contract which is made by reason of a salary reduc- tion agreement (whether evidenced by a written instrument or otherwise), (E) under or to an exempt governmental deferred compensation plan (as defined in section 3121(v)(3)), (F) to supplement pension benefits under a plan or trust described in any of the fore- going provisions of this paragraph to take into account some portion or all of the in- crease 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 Em- ployee 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 re- Page 2811 TITLE 26—INTERNAL REVENUE CODE § 3306 1 So in original. The comma probably should be a semicolon. gard to such plan and it is reasonable to be- lieve that (if section 125 applied for purposes of this section) section 125 would not treat any wages as constructively received, or (H) under an arrangement to which section 408(p) applies, other than any elective con- tributions under paragraph (2)(A)(i) thereof,1 (6) the payment by an employer (without de- duction from the remuneration of the em- ployee)— (A) of the tax imposed upon an employee under section 3101, or (B) of any payment required from an em- ployee under a State unemployment com- pensation law, with respect to remuneration paid to an em- ployee for domestic service in a private home of the employer or for agricultural labor; (7) remuneration paid in any medium other than cash to an employee for service not in the course of the employer’s trade or business; [(8) Repealed. Pub. L. 98–21, title III, § 324(b)(3)(B), Apr. 20, 1983, 97 Stat. 124] (9) 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 (de- termined without regard to section 274(n)); (10) any payment or series of payments by an employer to an employee or any of his depend- ents which is paid— (A) upon or after the termination of an employee’s employment relationship be- cause of (i) death, or (ii) retirement for dis- ability, and (B) under a plan established by the em- ployer which makes provision for his em- ployees 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 pay- ments which would have been paid if the em- ployee’s employment relationship had not been so terminated; (11) remuneration for agricultural labor paid in any medium other than cash; [(12) Repealed. Pub. L. 113–295, div. A, title II, § 221(a)(19)(B)(vi), Dec. 19, 2014, 128 Stat. 4040] (13) 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); (14) the value of any meals or lodging fur- nished 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 ex- clude such items from income under section 119; (15) any payment made by an employer to a survivor or the estate of a former employee after the calendar year in which such em- ployee died; (16) any benefit provided to or on behalf of an employee if at the time such benefit is pro- vided it is reasonable to believe that the em- ployee will be able to exclude such benefit from income under section 74(c), 108(f)(4), 117, or 132; (17) any payment made to or for the benefit of an employee if at the time of such payment it is reasonable to believe that the employee will be able to exclude such payment from in- come under section 106(b); (18) any payment made to or for the benefit of an employee if at the time of such payment it is reasonable to believe that the employee will be able to exclude such payment from in- come under section 106(d); (19) remuneration on account of— (A) a transfer of a share of stock to any in- dividual pursuant to an exercise of an incen- tive 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 (20) any benefit or payment which is exclud- able from the gross income of the employee under section 139B(b). Except as otherwise provided in regulations pre- scribed 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 treat- ed for purposes of this chapter and chapter 22 as the employer with respect to such wages. Noth- ing 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 re- quire a similar exclusion from ‘‘wages’’ in the regulations prescribed for purposes of this chap- ter. (c) Employment For purposes of this chapter, the term ‘‘em- ployment’’ means any service performed prior to 1955, which was employment for purposes of sub- chapter C of chapter 9 of the Internal Revenue Code of 1939 under the law applicable to the pe- riod in which such service was performed, and (A) any service, of whatever nature, performed after 1954 by an employee for the person employ- ing him, irrespective of the citizenship or resi- dence 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 air- craft it touches at a port in the United States, if the employee is employed on and in connec- tion with such vessel or aircraft when outside the United States, and (B) any service, of what- ever nature, performed after 1971 outside the United States (except in a contiguous country with which the United States has an agreement relating to unemployment compensation) by a citizen of the United States as an employee of an American employer (as defined in subsection (j)(3)), except— (1) agricultural labor (as defined in sub- section (k)) unless— (A) such labor is performed for a person who— Page 2812 TITLE 26—INTERNAL REVENUE CODE § 3306 (i) during any calendar quarter in the calendar year or the preceding calendar year paid remuneration in cash of $20,000 or more to individuals employed in agri- cultural labor (including labor performed by an alien referred to in subparagraph (B)), or (ii) on each of some 20 days during the calendar year or the preceding calendar year, each day being in a different cal- endar week, employed in agricultural labor (including labor performed by an alien referred to in subparagraph (B)) for some portion of the day (whether or not at the same moment of time) 10 or more indi- viduals; and (B) such labor is not agricultural labor performed by an individual who is an alien admitted to the United States to perform agricultural labor pursuant to sections 214(c) and 101(a)(15)(H) of the Immigration and Na- tionality Act; (2) domestic service in a private home, local college club, or local chapter of a college fra- ternity or sorority unless performed for a per- son who paid cash remuneration of $1,000 or more to individuals employed in such domes- tic service in any calendar quarter in the cal- endar year or the preceding calendar year; (3) service not in the course of the employ- er’s trade or business performed in any cal- endar quarter by an employee, unless the cash remuneration paid for such service is $50 or more and such service is performed by an indi- vidual who is regularly employed by such em- ployer to perform such service. For purposes of this paragraph, an individual shall be deemed to be regularly employed by an em- ployer during a calendar quarter only if— (A) on each of some 24 days during such quarter such individual performs for such employer for some portion of the day service not in the course of the employer’s trade or business, or (B) such individual was regularly em- ployed (as determined under subparagraph (A)) by such employer in the performance of such service during the preceding calendar quarter; (4) service performed on or in connection with a vessel or aircraft not an American ves- sel or American aircraft, if the employee is employed on and in connection with such ves- sel or aircraft when outside the United States; (5) service performed by an individual in the employ of his son, daughter, or spouse, and service performed by a child under the age of 21 in the employ of his father or mother; (6) service performed in the employ of the United States Government or of an instrumen- tality of the United States which is— (A) wholly or partially owned by the United States, or (B) exempt from the tax imposed by sec- tion 3301 by virtue of any provision of law which specifically refers to such section (or the corresponding section of prior law) in granting such exemption; (7) service performed in the employ of a State, or any political subdivision thereof, or in the employ of an Indian tribe, or any in- strumentality of any one or more of the fore- going which is wholly owned by one or more States or political subdivisions or Indian tribes; and any service performed in the em- ploy of any instrumentality of one or more States or political subdivisions to the extent that the instrumentality is, with respect to such service, immune under the Constitution of the United States from the tax imposed by section 3301; (8) service performed in the employ of a reli- gious, charitable, educational, or other organi- zation described in section 501(c)(3) which is exempt from income tax under section 501(a); (9) service performed by an individual as an employee or employee representative as de- fined in section 1 of the Railroad Unemploy- ment Insurance Act (45 U.S.C. 351); (10)(A) service performed in any calendar quarter in the employ of any organization ex- empt from income tax under section 501(a) (other than an organization described in sec- tion 401(a)) or under section 521, if the remu- neration for such service is less than $50, or (B) service performed in the employ of a school, college, or university, if such service is performed (i) by a student who is enrolled and is regularly attending classes at such school, college, or university, or (ii) by the spouse of such a student, if such spouse is advised, at the time such spouse commences to perform such service, that (I) the employment of such spouse to perform such service is provided under a program to provide financial assist- ance to such student by such school, college, or university, and (II) such employment will not be covered by any program of unemploy- ment insurance, or (C) service performed by an individual who is enrolled at a nonprofit or public educational institution which normally maintains a reg- ular faculty and curriculum and normally has a regularly organized body of students in at- tendance at the place where its educational activities are carried on as a student in a full- time program, taken for credit at such institu- tion, which combines academic instruction with work experience, if such service is an in- tegral part of such program, and such institu- tion has so certified to the employer, except that this subparagraph shall not apply to serv- ice performed in a program established for or on behalf of an employer or group of employ- ers, or (D) service performed in the employ of a hos- pital, if such service is performed by a patient of such hospital; (11) service performed in the employ of a for- eign government (including service as a con- sular or other officer or employee or a nondip- lomatic 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 Page 2813 TITLE 26—INTERNAL REVENUE CODE § 3306 foreign government, with respect to whose instrumentality 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 there- of; (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’ train- ing school chartered or approved pursuant to State law; and service performed as an intern in the employ of a hospital by an individual who has completed a 4 years’ course in a med- ical school chartered or approved pursuant to State law; (14) service performed by an individual for a person as an insurance agent or as an insur- ance solicitor, if all such service performed by such individual for such person is performed for remuneration solely by way of commis- sion; (15)(A) service performed by an individual under the age of 18 in the delivery or distribu- tion of newspapers or shopping news, not in- cluding 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 re- tention of the excess of such price over the amount at which the newspapers or magazines are charged to him, whether or not he is guar- anteed a minimum amount of compensation for such service, or is entitled to be credited with the unsold newspapers or magazines turned back; (16) service performed in the employ of an international organization; (17) service performed by an individual in (or as an officer or member of the crew of a vessel while it is engaged in) the catching, taking, harvesting, cultivating, or farming of any kind of fish, shellfish, crustacea, sponges, sea- weeds, or other aquatic forms of animal and vegetable life (including service performed by any such individual as an ordinary incident to any such activity), except— (A) service performed in connection with the catching or taking of salmon or halibut, for commercial purposes, and (B) service performed on or in connection with a vessel of more than 10 net tons (deter- mined in the manner provided for deter- mining the register tonnage of merchant vessels under the laws of the United States); (18) service described in section 3121(b)(20); (19) service which is performed by a non- resident 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 Immigra- tion and Nationality Act, as amended (8 U.S.C. 1101(a)(15)(F), (J), (M), or (Q)), and which is performed to carry out the purpose specified in subparagraph (F), (J), (M), or (Q), as the case may be; (20) service performed by a full time student (as defined in subsection (q)) in the employ of an organized camp— (A) if such camp— (i) did not operate for more than 7 months in the calendar year and did not operate for more than 7 months in the pre- ceding calendar year, or (ii) had average gross receipts for any 6 months in the preceding calendar year which were not more than 331⁄3 percent of its average gross receipts for the other 6 months in the preceding calendar year; and (B) if such full time student performed services in the employ of such camp for less than 13 calendar weeks in such calendar year; or (21) service performed by a person com- mitted to a penal institution. (d) 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 pe- riod 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 pe- riod by an employee for the person employing him, where any of such service is excepted by subsection (c)(9). (e) State agency For purposes of this chapter, the term ‘‘State agency’’ means any State officer, board, or other authority, designated under a State law to administer the unemployment fund in such State. (f) Unemployment fund For purposes of this chapter, the term ‘‘unem- ployment fund’’ means a special fund, estab- lished under a State law and administered by a State agency, for the payment of compensation. Any sums standing to the account of the State agency in the Unemployment Trust Fund estab- lished by section 904 of the Social Security Act, as amended (42 U.S.C. 1104), shall be deemed to be a part of the unemployment fund of the State, and no sums paid out of the Unemploy- ment Trust Fund to such State agency shall cease to be a part of the unemployment fund of the State until expended by such State agency. An unemployment fund shall be deemed to be maintained during a taxable year only if throughout such year, or such portion of the year as the unemployment fund was in exist- ence, no part of the moneys of such fund was ex- pended for any purpose other than the payment of compensation (exclusive of expenses of ad- Page 2814 TITLE 26—INTERNAL REVENUE CODE § 3306 ministration) and for refunds of sums erro- neously paid into such fund and refunds paid in accordance with the provisions of section 3305(b); except that— (1) an amount equal to the amount of em- ployee payments into the unemployment fund of a State may be used in the payment of cash benefits to individuals with respect to their disability, exclusive of expenses of administra- tion; (2) the amounts specified by section 903(c)(2) or 903(d)(4) of the Social Security Act may, subject to the conditions prescribed in such section, be used for expenses incurred by the State for administration of its unemployment compensation law and public employment of- fices,1 (3) nothing in this subsection shall be con- strued to prohibit deducting any amount from unemployment compensation otherwise pay- able to an individual and using the amount so deducted to pay for health insurance, or the withholding of Federal, State, or local indi- vidual income tax, if the individual elected to have such deduction made and such deduction was made under a program approved by the Secretary of Labor; (4) amounts may be deducted from unem- ployment benefits and used to repay overpay- ments as provided in section 303(g) of the So- cial Security Act; (5) amounts may be withdrawn for the pay- ment of short-time compensation under a short-time compensation program (as defined in subsection (v)); and (6) amounts may be withdrawn for the pay- ment of allowances under a self-employment assistance program (as defined in subsection (t)). (g) Contributions For purposes of this chapter, the term ‘‘con- tributions’’ means payments required by a State law to be made into an unemployment fund by any person on account of having individuals in his employ, to the extent that such payments are made by him without being deducted or de- ductible from the remuneration of individuals in his employ. (h) Compensation For purposes of this chapter, the term ‘‘com- pensation’’ means cash benefits payable to indi- viduals with respect to their unemployment. (i) Employee For purposes of this chapter, the term ‘‘em- ployee’’ has the meaning assigned to such term by section 3121(d), except that paragraph (4) and subparagraphs (B) and (C) of paragraph (3) shall not apply. (j) State, United States, and American employer For purposes of this chapter— (1) State The term ‘‘State’’ includes the District of Columbia, the Commonwealth of Puerto Rico, and the Virgin Islands. (2) United States The term ‘‘United States’’ when used in a geographical sense includes the States, the District of Columbia, the Commonwealth of Puerto Rico, and the Virgin Islands. (3) American employer The term ‘‘American employer’’ means a person who is— (A) an individual who is a resident of the United States, (B) a partnership, if two-thirds or more of the partners are residents of the United States, (C) a trust, if all of the trustees are resi- dents of the United States, or (D) a corporation organized under the laws of the United States or of any State. An individual who is a citizen of the Common- wealth of Puerto Rico or the Virgin Islands (but not otherwise a citizen of the United States) shall be considered, for purposes of this section, as a citizen of the United States. (k) Agricultural labor For purposes of this chapter, the term ‘‘agri- cultural labor’’ has the meaning assigned to such term by subsection (g) of section 3121, ex- cept that for purposes of this chapter subpara- graph (B) of paragraph (4) of such subsection (g) shall be treated as reading: ‘‘(B) in the employ of a group of operators of farms (or a cooperative organization of which such operators are members) in the performance of service described in subpara- graph (A), but only if such operators pro- duced more than one-half of the commodity with respect to which such service is per- formed;’’. [(l) Repealed. Sept. 1, 1954, ch. 1212, § 4(c), 68 Stat. 1135] (m) American vessel and aircraft For purposes of this chapter, the term ‘‘Amer- ican vessel’’ means any vessel documented or numbered under the laws of the United States; and includes any vessel which is neither docu- mented 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 air- craft registered under the laws of the United States. (n) Vessels operated by general agents of United States Notwithstanding the provisions of subsection (c)(6), service performed by officers and mem- bers of the crew of a vessel which would other- wise be included as employment under sub- section (c) shall not be excluded by reason of the fact that it is performed on or in connection with an American vessel— (1) owned by or bareboat chartered to the United States and (2) whose business is conducted by a general agent of the Secretary of Transportation. For purposes of this chapter, each such general agent shall be considered a legal entity in his capacity as such general agent, separate and dis- tinct from his identity as a person employing in- Page 2815 TITLE 26—INTERNAL REVENUE CODE § 3306 dividuals on his own account, and the officers and members of the crew of such an American vessel whose business is conducted by a general agent of the Secretary of Transportation shall be deemed to be performing services for such general agent rather than the United States. Each such general agent who in his capacity as such is an employer within the meaning of sub- section (a) shall be subject to all the require- ments imposed upon an employer under this chapter with respect to service which con- stitutes employment by reason of this sub- section. (o) Special rule in case of certain agricultural workers (1) Crew leaders who are registered or provide specialized agricultural labor For purposes of this chapter, any individual who is a member of a crew furnished by a crew leader to perform agricultural labor for any other person shall be treated as an employee of such crew leader— (A) if— (i) such crew leader holds a valid certifi- cate of registration under the Migrant and Seasonal Agricultural Worker Protection Act; or (ii) substantially all the members of such crew operate or maintain tractors, mechanized harvesting or crop-dusting equipment, or any other mechanized equipment, which is provided by such crew leader; and (B) if such individual is not an employee of such other person within the meaning of subsection (i). (2) Other crew leaders For purposes of this chapter, in the case of any individual who is furnished by a crew leader to perform agricultural labor for any other person and who is not treated as an em- ployee of such crew leader under paragraph (1)— (A) such other person and not the crew leader shall be treated as the employer of such individual; and (B) such other person shall be treated as having paid cash remuneration to such indi- vidual in an amount equal to the amount of cash remuneration paid to such individual by the crew leader (either on his behalf or on behalf of such other person) for the agricul- tural labor performed for such other person. (3) Crew leader For purposes of this subsection, the term ‘‘crew leader’’ means an individual who— (A) furnishes individuals to perform agri- cultural labor for any other person, (B) pays (either on his behalf or on behalf of such other person) the individuals so fur- nished by him for the agricultural labor per- formed by them, and (C) has not entered into a written agree- ment with such other person under which such individual is designated as an employee of such other person. (p) Concurrent employment by two or more em- ployers For purposes of sections 3301, 3302, and 3306(b)(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. (q) Full time student For purposes of subsection (c)(20), an indi- vidual shall be treated as a full time student for any period— (1) during which the individual is enrolled as a full time student at an educational institu- tion, or (2) which is between academic years or terms if— (A) the individual was enrolled as a full time student at an educational institution for the immediately preceding academic year or term, and (B) there is a reasonable assurance that the individual will be so enrolled for the im- mediately succeeding academic year or term after the period described in subparagraph (A). (r) Treatment of certain deferred compensation and salary reduction arrangements (1) Certain employer contributions treated as wages Nothing in any paragraph of subsection (b) (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 sec- tion 402(e)(3), or (B) any amount treated as an employer contribution under section 414(h)(2) where the pickup referred to in such section is pur- suant 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. (B) Taxed only once Any amount taken into account as wages by reason of subparagraph (A) (and the in- come attributable thereto) shall not there- after 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 de- ferral of compensation other than a plan de- scribed in subsection (b)(5). Page 2816 TITLE 26—INTERNAL REVENUE CODE § 3306 (s) Tips treated as wages For purposes of this chapter, the term ‘‘wages’’ includes tips which are— (1) received while performing services which constitute employment, and (2) included in a written statement furnished to the employer pursuant to section 6053(a). (t) Self-employment assistance program For the purposes of this chapter, the term ‘‘self-employment assistance program’’ means a program under which— (1) individuals who meet the requirements described in paragraph (3) are eligible to re- ceive an allowance in lieu of regular unem- ployment compensation under the State law for the purpose of assisting such individuals in establishing a business and becoming self-em- ployed; (2) the allowance payable to individuals pur- suant to paragraph (1) is payable in the same amount, at the same interval, on the same terms, and subject to the same conditions, as regular unemployment compensation under the State law, except that— (A) State requirements relating to avail- ability for work, active search for work, and refusal to accept work are not applicable to such individuals; (B) State requirements relating to dis- qualifying income are not applicable to in- come earned from self-employment by such individuals; and (C) such individuals are considered to be unemployed for the purposes of Federal and State laws applicable to unemployment compensation, as long as such individuals meet the require- ments applicable under this subsection; (3) individuals may receive the allowance de- scribed in paragraph (1) if such individuals— (A) are eligible to receive regular unem- ployment compensation under the State law, or would be eligible to receive such com- pensation except for the requirements de- scribed in subparagraph (A) or (B) of para- graph (2); (B) are identified pursuant to a State worker profiling system as individuals likely to exhaust regular unemployment com- pensation; and (C) are participating in self-employment assistance activities which— (i) include entrepreneurial training, business counseling, and technical assist- ance; and (ii) are approved by the State agency; and (D) are actively engaged on a full-time basis in activities (which may include train- ing) relating to the establishment of a busi- ness and becoming self-employed; (4) the aggregate number of individuals re- ceiving the allowance under the program does not at any time exceed 5 percent of the num- ber of individuals receiving regular unemploy- ment compensation under the State law at such time; (5) the program does not result in any cost to the Unemployment Trust Fund (established by section 904(a) of the Social Security Act) in excess of the cost that would be incurred by such State and charged to such Fund if the State had not participated in such program; and (6) the program meets such other require- ments as the Secretary of Labor determines to be appropriate. (u) Indian tribe For purposes of this chapter, the term ‘‘Indian tribe’’ has the meaning given to such term by section 4(e) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 5304(e)), and includes any subdivision, subsidiary, or business enterprise wholly owned by such an In- dian tribe. (v) Short-time compensation program For purposes of this section, the term ‘‘short- time compensation program’’ means a program under which— (1) the participation of an employer is vol- untary; (2) an employer reduces the number of hours worked by employees in lieu of layoffs; (3) such employees whose workweeks have been reduced by at least 10 percent, and by not more than the percentage, if any, that is de- termined by the State to be appropriate (but in no case more than 60 percent), are not dis- qualified from unemployment compensation; (4) the amount of unemployment compensa- tion payable to any such employee is a pro rata portion of the unemployment compensa- tion which would otherwise be payable to the employee if such employee were unemployed; (5) such employees meet the availability for work and work search test requirements while collecting short-time compensation benefits, by being available for their workweek as re- quired by the State agency; (6) eligible employees may participate, as appropriate, in training (including employer- sponsored training or worker training funded under the Workforce Innovation and Oppor- tunity Act) to enhance job skills if such pro- gram has been approved by the State agency; (7) the State agency shall require employers to certify that if the employer provides health benefits and retirement benefits under a de- fined benefit plan (as defined in section 414(j)) or contributions under a defined contribution plan (as defined in section 414(i)) to any em- ployee whose workweek is reduced under the program that such benefits will continue to be provided to employees participating in the short-time compensation program under the same terms and conditions as though the workweek of such employee had not been re- duced or to the same extent as other employ- ees not participating in the short-time com- pensation program; (8) the State agency shall require an em- ployer to submit a written plan describing the manner in which the requirements of this sub- section will be implemented (including a plan for giving advance notice, where feasible, to an employee whose workweek is to be reduced) together with an estimate of the number of layoffs that would have occurred absent the ability to participate in short-time compensa- Page 2817 TITLE 26—INTERNAL REVENUE CODE § 3306 tion and such other information as the Sec- retary of Labor determines is appropriate; (9) the terms of the employer’s written plan and implementation shall be consistent with employer obligations under applicable Federal and State laws; and (10) upon request by the State and approval by the Secretary of Labor, only such other provisions are included in the State law that are determined to be appropriate for purposes of a short-time compensation program. (Aug. 16, 1954, ch. 736, 68A Stat. 447; Sept. 1, 1954, ch. 1212, §§ 1, 4(c), 68 Stat. 1130, 1135; Pub. L. 86–70, § 22(a), June 25, 1959, 73 Stat. 146; Pub. L. 86–624, § 18(d), July 12, 1960, 74 Stat. 416; Pub. L. 86–778, title V, §§ 531(c), 532–534, 543(a), Sept. 13, 1960, 74 Stat. 983, 984, 986; Pub. L. 87–256, § 110(f), Sept. 21, 1961, 75 Stat. 537; Pub. L. 87–792, § 7(k), Oct. 10, 1962, 76 Stat. 830; Pub. L. 88–650, § 4(c), Oct. 13, 1964, 78 Stat. 1077; Pub. L. 90–248, title V, § 504(b), Jan. 2, 1968, 81 Stat. 935; Pub. L. 91–53, § 1, Aug. 7, 1969, 83 Stat. 91; Pub. L. 91–373, title I, §§ 101(a), 102(a), 103(a), 105(a), (b), 106(a), title III, § 302, Aug. 10, 1970, 84 Stat. 696, 697, 699, 700, 713; Pub. L. 94–455, title XIX, §§ 1903(a)(16), 1906(b)(13)(C), Oct. 4, 1976, 90 Stat. 1810, 1834; Pub. L. 94–566, title I, §§ 111 (a), (b), 112(a), 113(a), 114(a), 116(b), title II, § 211(a), Oct. 20, 1976, 90 Stat. 2667–2669, 2672, 2676; Pub. L. 95–216, title III, § 314(b), Dec. 20, 1977, 91 Stat. 1536; Pub. L. 95–472, § 3(a), Oct. 17, 1978, 92 Stat. 1333; Pub. L. 95–600, title I, § 164(b)(2), Nov. 6, 1978, 92 Stat. 2813; Pub. L. 96–84, § 4(a), (b), Oct. 10, 1979, 93 Stat. 654; Pub. L. 96–222, title I, § 101(a)(10)(B)(ii), Apr. 1, 1980, 94 Stat. 201; Pub. L. 96–499, title XI, § 1141(b), Dec. 5, 1980, 94 Stat. 2694; Pub. L. 97–34, title I, § 124(e)(2)(A), title VIII, § 822(a), Aug. 13, 1981, 95 Stat. 200, 351; Pub. L. 97–248, title II, §§ 271(a), 276(a)(1), (b)(1), (2), 277, Sept. 3, 1982, 96 Stat. 554, 558, 559; Pub. L. 98–21, title III, §§ 324(b)(1)–(4)(B), 327(c), 328(c), Apr. 20, 1983, 97 Stat. 123, 124, 127, 128; Pub. L. 98–135, title II, §§ 201(a), 202, Oct. 24, 1983, 97 Stat. 860; Pub. L. 98–369, div. A, title IV, § 491(d)(37), title V, § 531(d)(3), div. B, title VI, § 2661(o)(4), July 18, 1984, 98 Stat. 851, 884, 1159; Pub. L. 99–272, title XII, § 12401(b)(2), title XIII, § 13303(a), Apr. 7, 1986, 100 Stat. 297, 327; Pub. L. 99–509, title IX, § 9002(b)(2)(B), Oct. 21, 1986, 100 Stat. 1971; Pub. L. 99–514, title I, § 122(e)(3), title XI, §§ 1108(g)(8), 1151(d)(2)(B), title XVIII, §§ 1884(3), 1899A(44), (45), Oct. 22, 1986, 100 Stat. 2112, 2435, 2505, 2919, 2961; Pub. L. 99–595, Oct. 31, 1986, 100 Stat. 3348; Pub. L. 100–647, title I, §§ 1001(d)(2)(C)(iii), (g)(4)(B)(ii), 1011B(a) (22)(C), (23)(A), 1018(u)(50), title VIII, § 8016(a)(3)(B), Nov. 10, 1988, 102 Stat. 3351, 3352, 3486, 3593, 3792; Pub. L. 101–140, title II, § 203(a)(2), Nov. 8, 1989, 103 Stat. 830; Pub. L. 102–318, title III, § 303(a), title IV, § 401(a)(2), title V, § 521(b)(35), July 3, 1992, 106 Stat. 297, 298, 312; Pub. L. 103–182, title V, § 507(a), (b)(2), Dec. 8, 1993, 107 Stat. 2153, 2154; Pub. L. 103–296, title III, § 320(a)(1)(E), Aug. 15, 1994, 108 Stat. 1535; Pub. L. 103–465, title VII, § 702(c)(2), Dec. 8, 1994, 108 Stat. 4997; Pub. L. 104–188, title I, §§ 1203(a), 1421(b)(8)(C), 1704(t)(10), Aug. 20, 1996, 110 Stat. 1773, 1798, 1888; Pub. L. 104–191, title III, § 301(c)(2)(B), Aug. 21, 1996, 110 Stat. 2049; Pub. L. 105–33, title V, § 5406(a), Aug. 5, 1997, 111 Stat. 605; Pub. L. 106–554, § 1(a)(7) [title I, § 166(a), (d)], Dec. 21, 2000, 114 Stat. 2763, 2763A–627; Pub. L. 107–147, title II, § 209(d)(1), Mar. 9, 2002, 116 Stat. 33; Pub. L. 108–121, title I, § 106(b)(3), Nov. 11, 2003, 117 Stat. 1339; Pub. L. 108–173, title XII, § 1201(d)(2)(B), Dec. 8, 2003, 117 Stat. 2477; Pub. L. 108–357, title II, § 251(a)(3), title III, § 320(b)(3), Oct. 22, 2004, 118 Stat. 1458, 1473; Pub. L. 108–375, div. A, title V, § 585(b)(2)(C), Oct. 28, 2004, 118 Stat. 1932; Pub. L. 110–245, title I, § 115(b), June 17, 2008, 122 Stat. 1636; Pub. L. 112–96, title II, § 2161(a)(1), (b)(1)(B), Feb. 22, 2012, 126 Stat. 171, 172; Pub. L. 113–295, div. A, title II, § 221(a)(19)(B)(vi), Dec. 19, 2014, 128 Stat. 4040; Pub. L. 114–92, div. C, title XXXV, § 3503, Nov. 25, 2015, 129 Stat. 1219; Pub. L. 115–141, div. U, title IV, § 401(a)(212)–(215), Mar. 23, 2018, 132 Stat. 1194; Pub. L. 116–136, div. A, title II, § 2108(f), Mar. 27, 2020, 134 Stat. 329.) Editorial Notes REFERENCES IN TEXT Section 3(2)(B)(ii) of the Employee Retirement In- come Security Act of 1974, referred to in subsec. (b)(5)(F), is classified to section 1002(2)(B)(ii) of Title 29, Labor. Subchapter C of chapter 9 of the Internal Revenue Code of 1939, referred to in subsec. (c), was comprised of sections 1600 to 1611 of former Title 26, Internal Rev- enue Code. Subchapter C of chapter 9 was repealed by section 7851(a)(3) of this title. For table of comparisons of the 1939 Code to the 1986 Code, see table I preceding section 1 of this title. See, also, section 7851(e) of this title for provision that references in the 1986 Code to a provision of the 1939 Code, not then applicable, shall be deemed a reference to the corresponding provision of the 1986 Code, which is then applicable. Sections 214(c) and 101(a)(15)(H) of the Immigration and Nationality Act, referred to in subsec. (c)(1)(B), are classified to sections 1184(c) and 1101(a)(15)(H), respec- tively, of Title 8, Aliens and Nationality. Sections 303(g), 903(c)(2), (d)(4), and 904(a) of the So- cial Security Act, referred to in subsecs. (f)(2), (4) and (t)(5), are classified to sections 503(g), 1103(c)(2), (d)(4), and 1104(a), respectively, of Title 42, The Public Health and Welfare. The Migrant and Seasonal Agricultural Worker Pro- tection Act, referred to in subsec. (o)(1)(A)(i), is Pub. L. 97–470, Jan. 14, 1983, 96 Stat. 2584, which is classified generally to chapter 20 (§ 1801 et seq.) of Title 29, Labor. For complete classification of this Act to the Code, see Short Title note set out under section 1801 of Title 29 and Tables. The Workforce Innovation and Opportunity Act, re- ferred to in subsec. (v)(6), is Pub. L. 113–128, July 22, 2014, 128 Stat. 1425, which enacted chapter 32 (§ 3101 et seq.) of Title 29, Labor, repealed chapter 30 (§ 2801 et seq.) of Title 29 and chapter 73 (§ 9201 et seq.) of Title 20, Education, and made amendments to numerous other sections and notes in the Code. For complete classifica- tion of this Act to the Code, see Short Title note set out under section 3101 of Title 29 and Tables. AMENDMENTS 2020—Subsec. (v)(6). Pub. L. 116–136 substituted ‘‘Workforce Innovation and Opportunity Act’’ for ‘‘Workforce Investment Act of 1998’’. 2018—Subsec. (b)(5)(F). Pub. L. 115–141, § 401(a)(212), substituted comma for semicolon at end. Subsec. (c)(19). Pub. L. 115–141, § 401(a)(213), sub- stituted ‘‘service’’ for ‘‘Service’’. Subsec. (u). Pub. L. 115–141, § 401(a)(214), substituted ‘‘25 U.S.C. 5304(e)’’ for ‘‘25 U.S.C. 450b(e)’’. Subsec. (v). Pub. L. 115–141, § 401(a)(215), substituted ‘‘this section’’ for ‘‘this part’’ in introductory provi- sions. 2015—Subsec. (n). Pub. L. 114–92 substituted ‘‘Sec- retary of Transportation’’ for ‘‘Secretary of Com- merce’’ in par. (2) and concluding provisions. Page 2818 TITLE 26—INTERNAL REVENUE CODE § 3306 2014—Subsec. (b)(12). Pub. L. 113–295 struck out par. (12) which read as follows: ‘‘any contribution, payment, or service, provided by an employer which may be ex- cluded from the gross income of an employee, his spouse, or his dependents, under the provisions of sec- tion 120 (relating to amounts received under qualified group legal services plans);’’. 2012—Subsec. (f)(5). Pub. L. 112–96, § 2161(b)(1)(B)(i), added par. (5) and struck out former par. (5) relating to short-time compensation which read as follows: ‘‘amounts may be withdrawn for the payment of short- time compensation under a plan approved by the Sec- retary of Labor; and’’. Former par. (5) relating to self- employment assistance program redesignated (6). Subsec. (f)(6). Pub. L. 112–96, § 2161(b)(1)(B)(ii), redesig- nated par. (5) relating to self-employment assistance program as (6). Subsec. (v). Pub. L. 112–96, § 2161(a)(1), added subsec. (v). 2008—Subsec. (b)(20). Pub. L. 110–245 added par. (20). 2004—Subsec. (b)(13). Pub. L. 108–375 substituted ‘‘134(b)(4), or 134(b)(5)’’ for ‘‘or 134(b)(4)’’. Subsec. (b)(16). Pub. L. 108–357, § 320(b)(3), inserted ‘‘108(f)(4),’’ after ‘‘74(c),’’. Subsec. (b)(19). Pub. L. 108–357, § 251(a)(3), added par. (19). 2003—Subsec. (b)(13). Pub. L. 108–121 substituted ‘‘, 129, or 134(b)(4)’’ for ‘‘or 129’’. Subsec. (b)(18). Pub. L. 108–173 added par. (18). 2002—Subsec. (f)(2). Pub. L. 107–147 inserted ‘‘or 903(d)(4)’’ before ‘‘of the Social Security Act’’. 2000—Subsec. (c)(7). Pub. L. 106–554, § 1(a)(7) [title I, § 166(a)], inserted ‘‘or in the employ of an Indian tribe,’’ after ‘‘service performed in the employ of a State, or any political subdivision thereof,’’ and ‘‘or Indian tribes’’ after ‘‘wholly owned by one or more States or political subdivisions’’. Subsec. (u). Pub. L. 106–554, § 1(a)(7) [title I, § 166(d)], added subsec. (u). 1997—Subsec. (c)(21). Pub. L. 105–33 added par. (21). 1996—Subsec. (b)(5)(H). Pub. L. 104–188, § 1421(b)(8)(C), added subpar. (H). Subsec. (b)(17). Pub. L. 104–191 added par. (17). Subsec. (c)(1)(B). Pub. L. 104–188, § 1203(a), struck out ‘‘before January 1, 1995,’’ after ‘‘labor performed’’. Subsec. (k). Pub. L. 104–188, § 1704(t)(10), inserted a pe- riod at end. 1994—Subsec. (c)(19). Pub. L. 103–296 substituted ‘‘(J), (M), or (Q)’’ for ‘‘(J), or (M)’’ wherever appearing. Subsec. (f)(3) to (5). Pub. L. 103–465 added par. (3) and redesignated former pars. (3) and (4) as (4) and (5) relat- ing to payment of short-time compensation, respec- tively. 1993—Subsec. (f)(5). Pub. L. 103–182, § 507(b)(2), added par. (5). Subsec. (t). Pub. L. 103–182, § 507(a), added subsec. (t). 1992—Subsec. (c)(1)(B). Pub. L. 102–318, § 303(a), sub- stituted ‘‘1995’’ for ‘‘1993’’. Subsec. (f)(4). Pub. L. 102–318, § 401(a)(2), added par. (4). Subsec. (r)(1)(A). Pub. L. 102–318, § 521(b)(35), sub- stituted ‘‘402(e)(3)’’ for ‘‘402(a)(8)’’. 1989—Subsec. (t). Pub. L. 101–140 amended this section to read as if amendments by Pub. L. 100–647, § 1011B(a)(22)(C), had not been enacted, see 1988 Amend- ment note below. 1988—Subsec. (b)(5)(G). Pub. L. 100–647, § 1011B(a)(23)(A), inserted ‘‘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’’ after ‘‘section 125)’’. Subsec. (b)(9). Pub. L. 100–647, § 1001(g)(4)(B)(ii), in- serted ‘‘(determined without regard to section 274(n))’’ after ‘‘section 217’’. Subsec. (c)(1)(B). Pub. L. 100–647, § 1018(u)(50), amend- ed Pub. L. 99–272, § 13303(a), see 1986 Amendment notes below. Subsec. (c)(19). Pub. L. 100–647, § 1001(d)(2)(C)(iii), sub- stituted ‘‘(F), (J), or (M)’’ for ‘‘(F) or (J)’’ in three places. Subsec. (i). Pub. L. 100–647, § 8016(a)(3)(B), substituted ‘‘paragraph (4) and subparagraphs (B) and (C) of para- graph (3)’’ for ‘‘paragraph (3) and subparagraphs (B) and (C) of paragraph (4)’’. Subsec. (t). Pub. L. 100–647, § 1011B(a)(22)(C), added subsec. (t) relating to benefits provided under certain employee benefit plans. 1986—Subsec. (b)(2)(A). Pub. L. 99–514, § 1899A(44), sub- stituted ‘‘workmen’s compensation’’ for ‘‘workman’s compensation’’. Subsec. (b)(5)(C). Pub. L. 99–514, § 1108(g)(8), added sub- par. (C) and struck out former subpar. (C) which read as follows: ‘‘under a simplified employee pension if, at the time of the payment, it is reasonable to believe that the employee will be entitled to a deduction under sec- tion 219(b)(2) for such payment,’’. Subsec. (b)(5)(G). Pub. L. 99–514, § 1151(d)(2)(B), added subpar. (G). Subsec. (b)(13). Pub. L. 99–514, § 1899A(45), substituted a semicolon for a comma. Subsec. (b)(16). Pub. L. 99–514, § 122(e)(3), inserted ref- erence to section 74(c). Subsec. (c)(1)(B). Pub. L. 99–595 substituted ‘‘January 1, 1993’’ for ‘‘January 1, 1988’’. Pub. L. 99–272, § 13303(a), as amended by Pub. L. 100–647, § 1018(u)(50), substituted ‘‘January 1, 1988’’ for ‘‘January 1, 1986’’. Subsec. (f)(3). Pub. L. 99–272, § 12401(b)(2), added par. (3). Subsec. (i). Pub. L. 99–509 substituted ‘‘paragraph (3) and subparagraphs (B) and (C) of paragraph (4)’’ for ‘‘subparagraphs (B) and (C) of paragraph (3)’’. Subsec. (o)(1)(A)(i). Pub. L. 99–514, § 1884(3), sub- stituted ‘‘Migrant and Seasonal Agricultural Worker Protection Act’’ for ‘‘Farm Labor Contractor Registra- tion Act of 1963’’. 1984—Subsec. (b). Pub. L. 98–369, § 531(d)(3)(A), in pro- visions preceding par. (1), inserted ‘‘(including bene- fits)’’. Subsec. (b)(5)(C) to (G). Pub. L. 98–369, § 491(d)(37), struck out subpar. (C) which provided: ‘‘under or to a bond purchase plan which, at the time of such pay- ment, is a qualified bond purchase plan described in section 405(a),’’ and redesignated subpars. (D) to (G) as (C) to (F), respectively. Subsec. (b)(16). Pub. L. 98–369, § 531(d)(3)(B), added par. (16). Subsec. (r)(1)(B). Pub. L. 98–369, § 2661(o)(4), sub- stituted ‘‘section 414(h)(2) where the pickup referred to in such section is pursuant to a salary reduction agree- ment (whether evidenced by a written instrument or otherwise)’’ for ‘‘section 414(h)(2)’’. Subsec. (s). Pub. L. 98–369, § 1073(a), added subsec. (s). 1983—Subsec. (b). Pub. L. 98–21, § 327(c)(4), added sen- tence at end providing that nothing in the regulations prescribed for purposes of chapter 24 (relating to in- come tax withholding) which provides an exclusion from ‘‘wages’’ as used in such chapter shall be con- strued to require a similar exclusion from ‘‘wages’’ in regulations prescribed for purposes of this chapter. Pub. L. 98–21, § 324(b)(4)(B), added sentence at end pro- viding that, except as otherwise provided in regulations prescribed by the Secretary, any third party which makes a payment included in wages solely by reason of parenthetical text contained in subpar. (A) of par. (2) shall be treated for purposes of this chapter and chap- ter 22 as the employer with respect to such wages. Subsec. (b)(2). Pub. L. 98–21, § 324(b)(3)(A), (4)(A), struck out ‘‘(A) retirement or’’, redesignated subpars. (B) to (D) as (A) to (C), respectively, and in subpar. (A), as so redesignated, substituted ‘‘sickness or accident disability (but, in the case of payments made to an em- ployee or any of his dependents, this subparagraph shall exclude from the term ‘wages’ only payments which are received under a workman’s compensation law)’’ for ‘‘sickness or accident disability’’. Subsec. (b)(3). Pub. L. 98–21, § 324(b)(3)(B), struck out par. (3) which related to any payment made to an em- ployee (including any amount paid by an employer for insurance or annuities, or into a fund, to provide for any such payment) on account of retirement. Page 2819 TITLE 26—INTERNAL REVENUE CODE § 3306 Subsec. (b)(5)(D). Pub. L. 98–21, § 328(c), substituted ‘‘section 219(b)(2)’’ for ‘‘section 219’’. Subsec. (b)(5)(E) to (G). Pub. L. 98–21, § 324(b)(2), added subpars. (E) to (G). Subsec. (b)(8). Pub. L. 98–21, § 324(b)(3)(B), struck out par. (8) which related to any payment (other than vaca- tion or sick pay) made to an employee after the month in which he attained the age of 65, if he did not work for the employer in the period for which such payment was made. Subsec. (b)(10)(A). Pub. L. 98–21, § 324(b)(3)(C), struck out cl. (iii) which related to retirement after attaining an age specified in the plan referred to in subpar. (B) or in a pension plan of the employer. Subsec. (b)(14). Pub. L. 98–21, § 327(c)(1)–(3), added par. (14). Subsec. (b)(15). Pub. L. 98–135, § 201(a), added par. (15). Subsec. (c)(1)(B). Pub. L. 98–135, § 202, substituted ‘‘1986’’ for ‘‘1984’’. Subsec. (r). Pub. L. 98–21, § 324(b)(1), added subsec. (r). 1982—Subsec. (b)(1). Pub. L. 97–248, § 271(a), sub- stituted ‘‘$7,000’’ for ‘‘$6,000’’ wherever appearing. Subsec. (c)(1)(B). Pub. L. 97–248, § 277, substituted ‘‘1984’’ for ‘‘1982’’. Subsec. (c)(10)(C). Pub. L. 97–248, § 276(a)(1), struck out ‘‘under the age of 22’’ after ‘‘service performed by an in- dividual’’. Subsec. (c)(20). Pub. L. 97–248, § 276(b)(1), added par. (20). Subsec. (q). Pub. L. 97–248, § 276(b)(2), added subsec. (q). 1981—Subsec. (b)(13). Pub. L. 97–34, § 124(e)(2)(A), sub- stituted ‘‘section 127 or 129’’ for ‘‘section 127’’. Subsec. (c)(18), (19). Pub. L. 97–34, § 822(a), added par. (18) and redesignated former par. (18) as (19). 1980—Subsec. (b)(5)(D). Pub. L. 96–222 added subpar. (D). Subsec. (b)(6). Pub. L. 96–499 struck out ‘‘(or the cor- responding section of prior law)’’ after ‘‘section 3101’’ in subpar. (A) and inserted ‘‘with respect to remuneration paid to an employee for domestic service in a private home of the employer or for agricultural labor’’ fol- lowing subpar. (B). 1979—Subsec. (c)(1)(A). Pub. L. 96–84, § 4(b), sub- stituted ‘‘including labor performed by an alien’’ for ‘‘not taking into account labor performed before Janu- ary 1, 1980, by an alien’’ in parenthetical text of cls. (i) and (ii). Subsec. (c)(1)(B). Pub. L. 96–84, § 4(a), substituted ‘‘January 1, 1982’’ for ‘‘January 1, 1980’’. 1978—Subsec. (b)(12). Pub. L. 95–472 added par. (12). Subsec. (b)(13). Pub. L. 95–600 added par. (13). 1977—Subsec. (p). Pub. L. 95–216 added subsec. (p). 1976—Subsec. (a). Pub. L. 94–566, § 114(a), redesignated existing provisions, consisting of an introductory phrase and pars. (1) and (2), as par. (1), consisting of an introductory phrase and subpars. (A) and (B), inserted provisions following subpar. (B) as so redesignated, and added pars. (2), (3), and (4). Subsec. (b)(1). Pub. L. 94–566, § 211(a), substituted ‘‘$6,000’’ for ‘‘$4,200’’ wherever appearing. Subsec. (b)(11). Pub. L. 94–566, § 111(a), added par. (11). Subsec. (c). Pub. L. 94–566, § 116(b)(1), struck out ‘‘or in the Virgin Islands’’ after ‘‘agreement relating to un- employment compensation’’ in parenthetical provisions of cl. (B) preceding par. (1). Subsec. (c)(1). Pub. L. 94–566, § 111(b), inserted ‘‘un- less’’ after ‘‘subsection (k))’’ and added subpars. (A) and (B). Subsec. (c)(2). Pub. L. 94–566, § 113(a), inserted ‘‘unless performed for a person who paid cash remuneration of $1,000 or more to individuals employed in such domestic service in any calendar quarter in the calendar year or the preceding calendar year’’ after ‘‘sorority’’. Subsec. (c)(9). Pub. L. 94–455, § 1903(a)(16)(A), struck out ‘‘52 Stat. 1094, 1095;’’ before ‘‘45 U.S.C. 351’’. Subsec. (c)(12)(B). Pub. L. 94–455, § 1906(b)(13)(C), sub- stituted ‘‘to the Secretary of the Treasury’’ for ‘‘to the Secretary’’. Subsec. (c)(18). Pub. L. 94–455, § 1903(a)(16)(B), inserted ‘‘(8 U.S.C. 1101(a)(15)(F) or (J))’’ after ‘‘Immigration and Nationality Act, as amended’’. Subsec. (f). Pub. L. 94–455, § 1903(a)(16)(C), struck out ‘‘49 Stat. 640; 52 Stat. 1104, 1105;’’ before ‘‘42 U.S.C. 1104’’. Subsec. (j). Pub. L. 94–566, § 116(b)(2), inserted ref- erence to the Virgin Islands in pars. (1) and (2) and in provisions following par. (3). Subsec. (n). Pub. L. 94–455, § 1903(a)(16)(D), struck out ‘‘on or after July 1, 1953,’’ after ‘‘service performed’’. Subsec. (o). Pub. L. 94–566, § 112(a), added subsec. (o). 1970—Subsec. (a). Pub. L. 91–373, § 101(a), expanded def- inition of ‘‘employer’’ by reducing from 4 to 1 the num- ber of individuals which a person had to employ on each of some 20 days during the calendar year or the preceding calendar year in order to qualify as an em- ployer and inserted provisions making a person an em- ployer who paid wages of $1,500 or more during any cal- endar quarter in the calendar year or the preceding cal- endar year. Subsec. (b)(1). Pub. L. 91–373, § 302, substituted ‘‘$4,200’’ for ‘‘$3,000’’. Subsec. (c). Pub. L. 91–373, § 105(a), inserted reference to service performed after 1971 outside the United States by a citizen of the United States as an employee of an American employer. Subsec. (c)(10). Pub. L. 91–373, § 106(a), designated ex- isting provisions of subpar. (B) as cl. (i) thereof and added cl. (ii) of subpar. (B) and subpars. (C) and (D). Subsec. (i). Pub. L. 91–373, § 102(a), substituted mean- ing assigned ‘‘employee’’ by section 3121(d) of this title, except that subpars. (B) and (C) of par. (3) were not ap- plicable, as meaning of ‘‘employee’’ for purposes of this chapter for a definition of ‘‘employee’’ as persons in- cluding officers of corporations but not including inde- pendent contractors under common law rules or per- sons not employees under such rules. Subsec. (j)(3). Pub. L. 91–373, § 105(b), inserted defini- tion of ‘‘American employer’’. Subsec. (k). Pub. L. 91–373, § 103(a), substituted as def- inition of ‘‘agricultural labor’’ a simple reference to that term as defined, with a minor exception, in section 3121 of this title for a full definition of the term, the re- sult of which, in view of the substance of section 3121, excluded from the definition of agricultural labor serv- ices performed in connection with the production or harvesting of maple sirup, maple sugar, or mushrooms, or the hatching of poultry unless performed on a farm, and provided a new series of tests to determine whether the handling, planting, drying, packing, packaging, processing, freezing, grading, storing, or delivering ag- ricultural or horticultural commodities constitute ag- ricultural labor. 1969—Subsec. (a). Pub. L. 90–53 made status of em- ployer depend also on employment during preceding taxable year. 1968—Subsec. (b)(10). Pub. L. 90–248 added par. (10). 1964—Subsec. (b)(9). Pub. L. 88–650 added par. (9). 1962—Subsec. (b)(5). Pub. L. 87–792 substituted ‘‘is a plan described in section 403(a)’’ for ‘‘meets the require- ments of section 401(a)(3), (4), (5), and (6)’’ in subpar. (B), and added subpar. (C). 1961—Subsec. (c)(18). Pub. L. 87–256 added par. (18). 1960—Subsec. (c). Pub. L. 86–778, § 532(a), included em- ployment on or in connection with an American air- craft within cl. (B) of the opening provisions. Subsec. (c)(4). Pub. L. 86–778, § 532(b), excluded service performed on or in connection with an aircraft that is not an American aircraft. Subsec. (c)(6). Pub. L. 86–778, § 531(c), substituted ‘‘wholly or partially owned’’ for ‘‘wholly owned’’ in cl. (A), and inserted ‘‘which specifically refers to such sec- tion (or the corresponding section of prior law) in granting such exemption’’ in cl. (B). Subsec. (c)(8). Pub. L. 86–778, § 533, substituted ‘‘serv- ice performed in the employ of a religious, charitable, educational, or other organization described in section 501(c)(3) which is exempt from income tax under section 501(a)’’ for ‘‘service performed in the employ of a cor- poration, community chest, fund, or foundation, orga- nized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or edu- Page 2820 TITLE 26—INTERNAL REVENUE CODE § 3306 cational purposes, or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, and no substantial part of the activities of which is carrying on propaganda, or otherwise at- tempting, to influence legislation.’’ Subsec. (c)(10). Pub. L. 86–778, § 534, struck out provi- sions which excepted from definition of ‘‘employment’’ service in connection with the collection of dues or pre- miums for a fraternal beneficiary society, order, or as- sociation which is preformed away from the home of- fice or is ritualistic service in connection with any such society, order, or association, service performed in the employ of an agricultural or horticultural organi- zation described in section 501(c)(5) of this title, service performed in the employ of a voluntary employees’ beneficiary association providing for the payment of life, sick, accident, or other benefits to members or their dependents or designated beneficiaries, and serv- ice performed in the employ of a school, college, or uni- versity, not exempt from income tax under section 501(a) of this title if such service is performed by a stu- dent who is enrolled and regularly attending classes. Subsec. (j). Pub. L. 86–778, § 543(a), included the Com- monwealth of Puerto Rico and struck out ‘‘Hawaii’’ from definition of ‘‘State’’, defined ‘‘United States’’, and inserted provisions requiring an individual who is a citizen of the Commonwealth of Puerto Rico (but not otherwise a citizen of the United States) to be consid- ered for purposes of this section, as a citizen of the United States. Pub. L. 86–624 struck out ‘‘Hawaii, and’’ before ‘‘the District of Columbia’’. Subsec. (m). Pub. L. 86–778, § 532(c), included aircraft in heading and defined ‘‘American aircraft’’. 1959—Subsec. (j). Pub. L. 86–70 struck out ‘‘Alaska,’’ before ‘‘Hawaii’’. 1954—Subsec. (a). Act Sept. 1, 1954, changed definition of employer from ‘‘eight or more’’ to ‘‘4 or more’’. Subsec. (l). Act Sept. 1, 1954, repealed subsec. (l) which related to certain employees of Bonneville Power Administrator. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2014 AMENDMENT Amendment by Pub. L. 113–295 effective Dec. 19, 2014, subject to a savings provision, see section 221(b) of Pub. L. 113–295, set out as a note under section 1 of this title. EFFECTIVE DATE OF 2012 AMENDMENT; TRANSITION PROVISION Pub. L. 112–96, title II, § 2161(a)(2), (3), Feb. 22, 2012, 126 Stat. 172, provided that: ‘‘(2) EFFECTIVE DATE.—Subject to paragraph (3), the amendment made by paragraph (1) [amending this sec- tion] shall take effect on the date of the enactment of this Act [Feb. 22, 2012]. ‘‘(3) TRANSITION PERIOD FOR EXISTING PROGRAMS.—In the case of a State that is administering a short-time compensation program as of the date of the enactment of this Act and the State law cannot be administered consistent with the amendment made by paragraph (1), such amendment shall take effect on the earlier of— ‘‘(A) the date the State changes its State law in order to be consistent with such amendment; or ‘‘(B) the date that is 2 years and 6 months after the date of the enactment of this Act.’’ EFFECTIVE DATE OF 2008 AMENDMENT Amendment by Pub. L. 110–245 effective as if included in section 5 of Pub. L. 110–142, see section 115(d) of Pub. L. 110–245, set out as a note under section 3121 of this title. EFFECTIVE DATE OF 2004 AMENDMENTS Amendment by Pub. L. 108–375 applicable to travel benefits provided after Oct. 28, 2004, see section 585(b)(3) of Pub. L. 108–375, set out as a note under section 134 of this title. Amendment by section 251(a)(3) of Pub. L. 108–357 ap- plicable to stock acquired pursuant to options exer- cised after Oct. 22, 2004, see section 251(d) of Pub. L. 108–357, set out as a note under section 421 of this title. Amendment by section 320(b)(3) of Pub. L. 108–357 ap- plicable to amounts received by an individual in tax- able years beginning after Dec. 31, 2003, see section 320(c) of Pub. L. 108–357, set out as a note under section 108 of this title. EFFECTIVE DATE OF 2003 AMENDMENTS Amendment by Pub. L. 108–173 applicable to taxable years beginning after Dec. 31, 2003, see section 1201(k) of Pub. L. 108–173, set out as a note under section 62 of this title. Amendment by Pub. L. 108–121 applicable to taxable years beginning after Dec. 31, 2002, see section 106(c) of Pub. L. 108–121, set out as a note under section 134 of this title. EFFECTIVE DATE OF 2000 AMENDMENT; TRANSITION RULE Pub. L. 106–554, § 1(a)(7) [title I, § 166(e)], Dec. 21, 2000, 114 Stat. 2763, 2763A–628, provided that: ‘‘(1) EFFECTIVE DATE.—The amendments made by this section [amending this section and section 3309 of this title] shall apply to service performed on or after the date of the enactment of this Act [Dec. 21, 2000]. ‘‘(2) TRANSITION RULE.—For purposes of the Federal Unemployment Tax Act [26 U.S.C. 3301 et seq.], service performed in the employ of an Indian tribe (as defined in section 3306(u) of the Internal Revenue Code of 1986 (as added by this section)) shall not be treated as em- ployment (within the meaning of section 3306 of such Code) if— ‘‘(A) it is service which is performed before the date of the enactment of this Act [Dec. 21, 2000] and with respect to which the tax imposed under the Federal Unemployment Tax Act has not been paid, and ‘‘(B) such Indian tribe reimburses a State unem- ployment fund for unemployment benefits paid for service attributable to such tribe for such period.’’ EFFECTIVE DATE OF 1997 AMENDMENT Pub. L. 105–33, title V, § 5406(b), Aug. 5, 1997, 111 Stat. 605, provided that: ‘‘The amendments made by this sec- tion [amending this section] shall apply with respect to service performed after January 1, 1994.’’ EFFECTIVE DATE OF 1996 AMENDMENTS Amendment by Pub. L. 104–191 applicable to taxable years beginning after Dec. 31, 1996, see section 301(j) of Pub. L. 104–191, set out as a note under section 62 of this title. Pub. L. 104–188, title I, § 1203(b), Aug. 20, 1996, 110 Stat. 1773, provided that: ‘‘The amendment made by sub- section (a) [amending this section] shall apply to serv- ices performed after December 31, 1994.’’ Amendment by section 1421(b)(8)(C) of Pub. L. 104–188 applicable to taxable years beginning after Dec. 31, 1996, see section 1421(e) of Pub. L. 104–188, set out as a note under section 72 of this title. EFFECTIVE DATE OF 1994 AMENDMENTS Amendment by Pub. L. 103–465 applicable to pay- ments made after Dec. 31, 1996, see section 702(d) of Pub. L. 103–465, set out as a note under section 3304 of this title. Amendment by Pub. L. 103–296 effective with calendar quarter following Aug. 15, 1994, see section 320(c) of Pub. L. 103–296, set out as a note under section 871 of this title. EFFECTIVE DATE OF 1993 AMENDMENT Pub. L. 103–182, title V, § 507(e), Dec. 8, 1993, 107 Stat. 2154, as amended by Pub. L. 105–306, § 3, Oct. 28, 1998, 112 Stat. 2926, which provided that section 507 of Pub. L. 103–182 took effect on Dec. 8, 1993, was repealed by Pub. Page 2821 TITLE 26—INTERNAL REVENUE CODE § 3306 L. 116–113, title VI, § 601, Jan. 29, 2020, 134 Stat. 78, effec- tive on the date the USMCA entered into force (July 1, 2020). EFFECTIVE DATE OF 1992 AMENDMENT Amendment by section 521(b)(35) of Pub. L. 102–318 ap- plicable to distributions after Dec. 31, 1992, see section 521(e) of Pub. L. 102–318, set out as a note under section 402 of this title. EFFECTIVE DATE OF 1989 AMENDMENT Amendment by Pub. L. 101–140 effective as if included in section 1151 of Pub. L. 99–514, see section 203(c) of Pub. L. 101–140, set out as a note under section 79 of this title. EFFECTIVE DATE OF 1988 AMENDMENT Amendment by section 1011B(a)(22)(C) of Pub. L. 100–647 not applicable to any individual who separated from service with the employer before Jan. 1, 1989, see section 1011B(a)(22)(F) of Pub. L. 100–647, set out as a note under section 3121 of this title. Pub. L. 100–647, title I, § 1018(u)(50), Nov. 10, 1988, 102 Stat. 3593, provided that the amendment made by that section is effective Apr. 7, 1986. Amendment by sections 1001(d)(2)(C)(iii), (g)(4)(B)(ii), and 1011B(a)(23)(A) of Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title. Amendment by section 8016(a)(3)(B) of Pub. L. 100–647 effective Nov. 10, 1988, except that any amendment to a provision of a particular Public Law which is referred to by its number, or to a provision of the Social Secu- rity Act [42 U.S.C. 301 et seq.], or to this title as added or amended by a provision of a particular Public Law which is so referred to, effective as though included or reflected in the relevant provisions of that Public Law at the time of its enactment, see section 8016(b) of Pub. L. 100–647, set out as a note under section 3111 of this title. EFFECTIVE DATE OF 1986 AMENDMENT Amendment by section 122(e)(3) of Pub. L. 99–514 ap- plicable to prizes and awards granted after Dec. 31, 1986, see section 151(c) of Pub. L. 99–514, set out as a note under section 1 of this title. Amendment by section 1108(g)(8) of Pub. L. 99–514 ap- plicable to years beginning after Dec. 31, 1986, see sec- tion 1108(h) of Pub. L. 99–514, set out as a note under section 219 of this title. Amendment by section 1151(d)(2)(B) of Pub. L. 99–514 applicable to taxable years beginning after Dec. 31, 1983, see section 1151(k)(5) of Pub. L. 99–514, set out as a note under section 79 of this title. Amendment by Pub. L. 99–509 effective, except as oth- erwise provided, with respect to payments due with re- spect to wages paid after Dec. 31, 1986, including wages paid after such date by a State (or political subdivision thereof) that modified its agreement pursuant to sec- tion 418(e)(2) of Title 42, The Public Health and Welfare, see section 9002(d) of Pub. L. 99–509, set out as a note under section 418 of Title 42. Amendment by Pub. L. 99–272 applicable to recoveries made on or after Apr. 7, 1986, and applicable with re- spect to overpayments made before, on, or after such date, see section 12401(c) of Pub. L. 99–272, set out as a note under section 503 of Title 42. EFFECTIVE DATE OF 1984 AMENDMENT Amendment by section 491(d)(37) of Pub. L. 98–369 ap- plicable to obligations issued after Dec. 31, 1983, see sec- tion 491(f)(1) of Pub. L. 98–369, set out as a note under section 62 of this title. Amendment by section 531(d)(3) of Pub. L. 98–369 ef- fective Jan. 1, 1985, see section 531(h) of Pub. L. 98–369, set out as an Effective Date note under section 132 of this title. Pub. L. 98–369, div. A, title X, § 1073(b), July 18, 1984, 98 Stat. 1053, provided that: ‘‘(1) IN GENERAL.—Except as provided in paragraph (2), the amendment made by subsection (a) [amending this section] shall take effect on January 1, 1986. ‘‘(2) EXCEPTION FOR CERTAIN STATES.—In the case of any State the legislature of which— ‘‘(A) did not meet in a regular session which begins during 1984 and after the date of the enactment of this Act [July 18, 1984], and ‘‘(B) did not meet in a session which began before the date of the enactment of this Act and remained in session for at least 25 calendar days after such date of enactment, the amendment made by subsection (a) shall take ef- fect on January 1, 1987.’’ Pub. L. 98–369, div. B, title VI, § 2661(o)(4), July 18, 1984, 98 Stat. 1159, provided that the amendment made by that section is effective Jan. 1, 1985. EFFECTIVE DATE OF 1983 AMENDMENTS Pub. L. 98–135, title II, § 201(b), Oct. 24, 1983, 97 Stat. 860, provided that: ‘‘The amendments made by sub- section (a) [amending this section] shall apply to remu- neration paid after the date of the enactment of this Act [Oct. 24, 1983].’’ Amendment by section 324(b)(1)–(4)(B) of Pub. L. 98–21 applicable to remuneration paid after Dec. 31, 1984, ex- cept for certain employer contributions made during 1984 under a qualified cash or deferred arrangement, and except in the case of an agreement with certain nonqualified deferred compensation plans in existence on Mar. 24, 1983, see section 324(d) of Pub. L. 98–21 set out as a note under section 3121 of this title. Amendment by section 327(c)(1)–(3) of Pub. L. 98–21 applicable to remuneration paid after Dec. 31, 1984, see section 327(d)(3) of Pub. L. 98–21, as amended, set out as a note under section 3121 of this title. Amendment by section 327(c)(4) of Pub. L. 98–21 appli- cable to remuneration (other than amounts excluded under 26 U.S.C. 119) paid after Mar. 4, 1983, and to any such remuneration paid on or before such date which the employer treated as wages when paid, see section 327(d)(2) of Pub. L. 98–21, as amended, set out as a note under section 3121 of this title. Amendment by section 328(c) of Pub. L. 98–21 applica- ble to remuneration paid after Dec. 31, 1984, see section 328(d)(2) of Pub. L. 98–21, set out as a note under section 3121 of this title. EFFECTIVE AND TERMINATION DATES OF 1982 AMENDMENTS Amendment by section 271(a) of Pub. L. 97–248 appli- cable to remuneration paid after Dec. 31, 1982, see sec- tion 271(d)(1) of Pub. L. 97–248, as amended, set out as a note under section 3301 of this title. Pub. L. 97–248, title II, § 276(a)(2), Sept. 3, 1982, 96 Stat. 558, provided that: ‘‘The amendment made by para- graph (1) [amending this section] shall apply with re- spect to services performed after the date of the enact- ment of this Act [Sept. 3, 1982].’’ Pub. L. 97–248, title II, § 276(b)(3), Sept. 3, 1982, 96 Stat. 559, provided that: ‘‘The amendments made by this sub- section [amending this section] shall apply to remu- neration paid after December 31, 1982, and before Janu- ary 1, 1984.’’ EFFECTIVE DATE OF 1981 AMENDMENT Amendment by section 124(e)(2)(A) of Pub. L. 97–34 ap- plicable to remuneration paid after Dec. 31, 1981, see section 124(f) of Pub. L. 97–34, set out as an Effective Date of 1981 Amendment note under section 21 of this title. Pub. L. 97–34, title VIII, § 822(b), Aug. 13, 1981, 95 Stat. 351, as amended by Pub. L. 97–362, title II, § 203, Oct. 25, 1982, 96 Stat. 1733; Pub. L. 98–369, div. A, title X, § 1074, July 18, 1984, 98 Stat. 1053; Pub. L. 99–272, title XIII, § 13303(c)(1), Apr. 7, 1986, 100 Stat. 327, provided that: ‘‘The amendments made by subsection (a) [amending Page 2822 TITLE 26—INTERNAL REVENUE CODE § 3306 this section] shall apply to remuneration paid after De- cember 31, 1980.’’ EFFECTIVE DATE OF 1980 AMENDMENTS For effective date of amendment by Pub. L. 96–499, see section 1141(c) of Pub. L. 96–499, set out as a note under section 3121 of this title. Amendment by Pub. L. 96–222 applicable to payments made on or after Jan. 1, 1979, see section 101(b)(1)(E) of Pub. L. 96–222, set out as a note under section 3121 of this title. EFFECTIVE DATE OF 1979 AMENDMENT Pub. L. 96–84, § 4(c), Oct. 10, 1979, 93 Stat. 654, provided that: ‘‘The amendments made by this section [amend- ing this section] shall apply to remuneration paid after December 31, 1979, for services performed after such date.’’ EFFECTIVE DATE OF 1978 AMENDMENTS Amendment by Pub. L. 95–600 applicable with respect to taxable years beginning after Dec. 31, 1978, see sec- tion 164(d) of Pub. L. 95–600, set out as an Effective Date note under section 127 of this title. Amendment by Pub. L. 95–472 applicable with respect to taxable years beginning after Dec. 31, 1976, see sec- tion 3(d) of Pub. L. 95–472, set out as a note under sec- tion 3121 of this title. EFFECTIVE DATE OF 1977 AMENDMENT Amendment by Pub. L. 95–216 applicable with respect to wages paid after Dec. 31, 1978, see section 314(c) of Pub. L. 95–216, set out as a note under section 3121 of this title. EFFECTIVE DATE OF 1976 AMENDMENT Pub. L. 94–566, title I, § 111(c), Oct. 20, 1976, 90 Stat. 2667, provided that: ‘‘The amendments made by this section [amending this section] shall apply with re- spect to remuneration paid after December 31, 1977, for services performed after such date.’’ Pub. L. 94–566, title I, § 112(b), Oct. 20, 1976, 90 Stat. 2668, provided that: ‘‘The amendment made by sub- section (a) [amending this section] shall apply with re- spect to remuneration paid after December 31, 1977, for services performed after such date.’’ Pub. L. 94–566, title I, § 113(b), Oct. 20, 1976, 90 Stat. 2669, provided that: ‘‘The amendment made by sub- section (a) [amending this section] shall apply with re- spect to remuneration paid after December 31, 1977, for services performed after such date.’’ Pub. L. 94–566, title I, § 114(c), Oct. 20, 1976, 90 Stat. 2670, provided that: ‘‘The amendments made by this section [amending this section and section 6157 of this title] shall apply with respect to remuneration paid after December 31, 1977, for services performed after such date.’’ Amendment by section 116(b) of Pub. L. 94–566 appli- cable with respect to remuneration paid after Dec. 31 of the year in which the Secretary of Labor approves for the first time an unemployment compensation law sub- mitted to him by the Virgin Islands for approval, for services performed after such Dec. 31, see section 116(f)(2) of Pub. L. 94–566, set out as a note under sec- tion 3304 of this title. Pub. L. 94–566, title II, § 211(d)(1), Oct. 20, 1976, 90 Stat. 2677, provided that: ‘‘The amendment made by sub- section (a) [amending this section] shall apply to remu- neration paid after December 31, 1977.’’ EFFECTIVE DATE OF 1970 AMENDMENT Pub. L. 91–373, title I, § 101(c)(1), Aug. 10, 1970, 84 Stat. 696, provided that: ‘‘The amendments made by sub- sections (a) and (b)(1) [amending this section and sec- tion 6157 of this title] shall apply with respect to cal- endar years beginning after December 31, 1971.’’ Pub. L. 91–373, title I, § 102(c), Aug. 10, 1970, 84 Stat. 696, provided that: ‘‘The amendment made by sub- section (a) [amending this section] shall apply with re- spect to remuneration paid after December 31, 1971, for services performed after such date.’’ Pub. L. 91–373, title I, § 103(b), Aug. 10, 1970, 84 Stat. 697, provided that: ‘‘The amendment made by sub- section (a) [amending this section] shall apply with re- spect to remuneration paid after December 31, 1971, for services performed after such date.’’ Pub. L. 91–373, title I, § 105(c), Aug. 10, 1970, 84 Stat. 700, provided that: ‘‘The amendments made by this sec- tion [amending this section] shall apply with respect to service performed after December 31, 1971.’’ Pub. L. 91–373, title I, § 106(b), Aug. 10, 1970, 84 Stat. 701, provided that: ‘‘Subsection (a) [amending this sec- tion] shall apply with respect to remuneration paid after December 31, 1969.’’ Pub. L. 91–373, title III, § 302, Aug. 10, 1970, 84 Stat. 713, provided that the amendment made by that section is effective with respect to remuneration paid after Dec. 31, 1971. EFFECTIVE DATE OF 1969 AMENDMENT Amendment by Pub. L. 91–53 applicable with respect to calendar years beginning after Dec. 31, 1969, see sec- tion 4(a) of Pub. L. 91–53, set out as an Effective Date note under section 6157 of this title. EFFECTIVE DATE OF 1968 AMENDMENT Amendment by Pub. L. 90–248 applicable with respect to remuneration paid after Jan. 2, 1968, see section 504(d) of Pub. L. 90–248, set out as a note under section 3121 of this title. EFFECTIVE DATE OF 1964 AMENDMENT Amendment by Pub. L. 88–650 applicable with respect to remuneration paid on or after first day of first cal- endar month which begins more than ten days after Oct. 13, 1964, see section 4(d) of Pub. L. 88–650, set out as a note under section 3121 of this title. EFFECTIVE DATE OF 1962 AMENDMENT Amendment by Pub. L. 87–792 applicable to taxable years beginning after Dec. 31, 1962, see section 8 of Pub. L. 87–792, set out as a note under section 22 of this title. EFFECTIVE DATE OF 1961 AMENDMENT Amendment by Pub. L. 87–256 applicable with respect to service performed after Dec. 31, 1961, see section 110(h)(3) of Pub. L. 87–256, set out as a note under sec- tion 3121 of this title. EFFECTIVE DATE OF 1960 AMENDMENTS Amendment by sections 531(c) and 532 to 534 of Pub. L. 86–778 applicable with respect to remuneration paid after 1961 for services performed after 1961, see section 535 of Pub. L. 86–778, set out as a note under section 3305 of this title. Pub. L. 86–778, title V, § 543(a), Sept. 13, 1960, 74 Stat. 986, provided that the amendment made by that section is effective with respect to remuneration paid after Dec. 31, 1960, for services performed after such date. Amendment by Pub. L. 86–624 effective on Aug. 21, 1959, see section 18(k) of Pub. L. 86–624, set out as a note under section 3121 of this title. EFFECTIVE DATE OF 1959 AMENDMENT Amendment by Pub. L. 86–70 effective Jan. 3, 1959, see section 22(i) of Pub. L. 86–70, set out as a note under section 3121 of this title. EFFECTIVE DATE OF 1954 AMENDMENT Act Sept. 1, 1954, ch. 1212, § 1, 68 Stat. 1130, provided that the amendment made by that section is effective with respect to services performed after Dec. 31, 1955. Act Sept. 1, 1954, ch. 1212, § 4(c), 68 Stat. 1135, provided that the amendment made by that section is effective with respect to services performed after Dec. 31, 1954. Page 2823 TITLE 26—INTERNAL REVENUE CODE § 3307 TECHNICAL ASSISTANCE AND GUIDANCE FOR SHORT-TIME COMPENSATION PROGRAMS Pub. L. 116–127, div. D, § 4104, Mar. 18, 2020, 134 Stat. 194, which required the Secretary of Labor to provide States with technical assistance and guidance for short-time compensation programs, was repealed by Pub. L. 116–136, div. A, title II, § 2111(d), Mar. 27, 2020, 134 Stat. 333. See section 9029 of Title 15, Commerce and Trade. NO INFERENCE TO BE DRAWN FROM AMENDMENT BY PUB. L. 108–121 No inference to be drawn from amendment to subsec. (b)(13) of this section by section 106 of Pub. L. 108–121 with respect to tax treatment of any amounts under program described in section 134(b)(4) of this title for any taxable year beginning before Jan. 1, 2003, see sec- tion 106(d) of Pub. L. 108–121, set out as a note under section 134 of this title. REPORTING REQUIREMENTS Pub. L. 103–182, title V, § 507(c), (d), Dec. 8, 1993, 107 Stat. 2154, which set out reporting requirements related to self-employment assistance programs, was repealed by Pub. L. 116–113, title VI, § 601, Jan. 29, 2020, 134 Stat. 78, effective on the date the USMCA entered into force (July 1, 2020). EXCLUSION FROM WAGES AND COMPENSATION OF RE- FUNDS REQUIRED FROM EMPLOYERS TO COMPENSATE FOR DUPLICATION OF MEDICARE BENEFITS BY HEALTH CARE BENEFITS PROVIDED BY EMPLOYERS For purposes of this chapter, the term ‘‘wages’’ shall not include the amount of any refund required under section 421 of Pub. L. 100–360, 42 U.S.C. 1395b note, see section 10202 of Pub. L. 101–239, set out as a note under section 1395b of Title 42, The Public Health and Wel- fare. NONENFORCEMENT OF AMENDMENT MADE BY SECTION 1151 OF PUB. L. 99–514 FOR FISCAL YEAR 1990 No monies appropriated by Pub. L. 101–136 to be used to implement or enforce section 1151 of Pub. L. 99–514 or the amendments made by such section, see section 528 of Pub. L. 101–136, set out as a note under section 89 of this title. PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1998 For provisions directing that if any amendments made by subtitle D [§§ 1401–1465] of title I of Pub. L. 104–188 require an amendment to any plan or annuity contract, such amendment shall not be required to be made before the first day of the first plan year begin- ning on or after Jan. 1, 1998, see section 1465 of Pub. L. 104–188, set out as a note under section 401 of this title. PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1994 For provisions directing that if any amendments made by subtitle B [§§ 521–523] of title V of Pub. L. 102–318 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1994, see section 523 of Pub. L. 102–318, set out as a note under section 401 of this title. PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989 For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of this title. APPLICABILITY OF UNEMPLOYMENT COMPENSATION TAX TO CERTAIN SERVICES PERFORMED FOR CERTAIN IN- DIAN TRIBAL GOVERNMENTS Pub. L. 99–514, title XVII, § 1705, Oct. 22, 1986, 100 Stat. 2780, provided that: ‘‘(a) IN GENERAL.—For purposes of the Federal Unem- ployment Tax Act [26 U.S.C. 3301 et seq.], service per- formed in the employ of a qualified Indian tribal gov- ernment shall not be treated as employment (within the meaning of section 3306 of such Act) if it is serv- ice— ‘‘(1) which is performed— ‘‘(A) before, on, or after the date of the enactment of this Act [Oct. 22, 1986], but before January 1, 1988, and ‘‘(B) during a period in which the Indian tribal government is not covered by a State unemploy- ment compensation program, and ‘‘(2) with respect to which the tax imposed under the Federal Unemployment Tax Act has not been paid. ‘‘(b) DEFINITION.—For purposes of this section, the term ‘qualified Indian tribal government’ means an In- dian tribal government the service for which is not cov- ered by a State unemployment compensation program on June 11, 1986.’’ REMUNERATION PAID AFTER SEPT. 30, 1985, TO FULL- TIME STUDENTS EMPLOYED BY SUMMER CAMPS Pub. L. 99–272, title XIII, § 13303(b), Apr. 7, 1986, 100 Stat. 327, provided that: ‘‘Notwithstanding paragraph (3) of section 276(b) of the Tax Equity and Fiscal Re- sponsibility Act of 1982 [see Effective Date of 1982 Amendments note above], the amendments made by paragraphs (1) and (2) of such section 276(b) [amending this section] shall also apply to remuneration paid after September 19, 1985.’’ ADMINISTRATION OF PROVISIONS COVERING PAYMENTS TO EMPLOYEES ON ACCOUNT OF SICKNESS OR ACCI- DENT DISABILITY Pub. L. 98–21, title III, § 324(b)(4)(C), Apr. 20, 1983, 97 Stat. 124, provided that: ‘‘Rules similar to the rules of subsections (d) and (e) of section 3 of the Act entitled ‘An Act to amend the Omnibus Reconciliation Act of 1981 to restore minimum benefits under the Social Se- curity Act’ (Public Law 97–123), approved December 29, 1981 [set out as notes under section 3121 of this title], shall apply in the administration of section 3306(b)(2)(A) of such Code (as amended by subparagraph (A)).’’ APPLICABILITY TO FEDERAL LAND BANKS, FEDERAL IN- TERMEDIATE CREDIT BANKS, AND BANKS FOR CO- OPERATIVES Applicability of subsec. (c)(6) of this section to Fed- eral land banks, Federal intermediate credit banks, and banks for cooperatives, see section 531(g) of Pub. L. 86–778, set out as a note under section 3305 of this title. § 3307. Deductions as constructive payments Whenever under this chapter or any act of Congress, or under the law of any State, an em- ployer is required or permitted to deduct any amount from the remuneration of an employee and to pay the amount deducted to the United States, a State, or any political subdivision thereof, then for purposes of this chapter the amount so deducted shall be considered to have been paid to the employee at the time of such deduction. (Aug. 16, 1954, ch. 736, 68A Stat. 454.)