S. 1231 (103rd): Social Security Domestic Employment Reform Act of 1994

103rd Congress, 1993–1994. Text as of Apr 19, 1994 (Reported by Senate Committee).

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S 1231 RS

Calendar No. 415

103d CONGRESS

2d Session

S. 1231

[Report No. 103-252]

To provide for simplified collection of employment taxes on domestic services, and for other purposes.

IN THE SENATE OF THE UNITED STATES

July 14 (legislative day, JUNE 30), 1993

Mr. MOYNIHAN (for himself, Mr. DOLE, Mr. BOREN, Mr. WALLOP, Mr. GRASSLEY, Mr. CHAFEE, Mr. BREAUX, Mrs. MURRAY, Mr. ROCKEFELLER, Mr. PACKWOOD, Mr. MATHEWS, Mr. MITCHELL, Mr. CONRAD, Mr. RIEGLE, Mr. HATCH, and Mr. CAMPBELL) introduced the following bill; which was read twice and referred to the Committee on Finance

April 19 (legislative day, APRIL 11), 1994

Reported by Mr. MOYNIHAN, with amendments

[Omit the part struck through and insert the part printed in italic]


A BILL

To provide for simplified collection of employment taxes on domestic services, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ‘Social Security Domestic Employment Reform Act of [Struck out->] 1993 [<-Struck out] 1994’.

SEC. 2. SIMPLIFICATION OF EMPLOYMENT TAXES ON DOMESTIC SERVICES.

    (a) THRESHOLD REQUIREMENT FOR SOCIAL SECURITY TAXES-

      (1) AMENDMENTS OF INTERNAL REVENUE CODE-

        (A) GENERAL RULE- Subparagraph (B) of section 3121(a)(7) of the Internal Revenue Code of 1986 (defining wages) is amended to read as follows:

        ‘(B) cash remuneration paid by an employer in any calendar year to an employee for domestic service in a private home of the employer ( [Struck out->] other than service [<-Struck out] including domestic service described in subsection (g)(5)), if the cash remuneration paid in such year by the employer to the employee for such service is less than the applicable dollar threshold (as defined in subsection ( [Struck out->] y [<-Struck out] x)) for such year;’.

        (B) APPLICABLE DOLLAR THRESHOLD- Section 3121 of such Code is amended by adding at the end thereof the following new subsection:

    ‘( [Struck out->] y [<-Struck out] x) APPLICABLE DOLLAR THRESHOLD- For purposes of subsection (a)(7)(B), the term ‘applicable dollar threshold’ means the amount required for a quarter of coverage as determined under section 213(d)(2) of the Social Security Act for calendar year [Struck out->] 1994 [<-Struck out] 1995. In the case of calendar years after [Struck out->] 1994 [<-Struck out] 1995, the Secretary of Health and Human Services shall adjust such amount at the same time and in the same manner as the amount under section 213(d)(2) of the Social Security Act, except that such adjustment shall not take effect in any year in which the otherwise adjusted amount does not exceed the amount in effect under this subsection for the preceding calendar year by at least $50.’

        (C) EMPLOYMENT OF DOMESTIC EMPLOYEES UNDER AGE 18 EXCLUDED FROM COVERAGE- Section 3121(b) of such Code (defining employment) is amended--

          (i) by striking ‘or’ at the end of paragraph (19),

          (ii) by striking the period at the end of paragraph (20) and inserting ‘; or’, and

          (iii) by adding at the end the following new paragraph:

      ‘(21) domestic service in a private home of the employer performed in any year by an individual under the age of 18 during any portion of such year.’.

        (D) CONFORMING AMENDMENTS- The second sentence of section 3102(a) of such Code is amended--

          (i) by striking ‘calendar quarter’ each place it appears and inserting ‘calendar year’, and

          (ii) by striking ‘$50’ and inserting ‘the applicable dollar threshold (as defined in section 3121( [Struck out->] y [<-Struck out] x)) for such year’.

      (2) AMENDMENT OF SOCIAL SECURITY ACT-

        (A) GENERAL RULE- Subparagraph (B) of section 209(a)(6) of the Social Security Act (42 U.S.C. 409(a)(6)(B)) is amended to read as follows:

      ‘(B) Cash remuneration paid by an employer in any calendar year to an employee for domestic service in a private home of the employer ( [Struck out->] other than service [<-Struck out] including domestic service described in [Struck out->] subsection (g)(5) [<-Struck out] section 210(f)(5)), if the cash remuneration paid in such year by the employer to the employee for such service is less than the applicable dollar threshold (as defined in section 3121( [Struck out->] y [<-Struck out] x) of the Internal Revenue Code of 1986) for such year;’.

        (B) EMPLOYMENT OF DOMESTIC EMPLOYEES UNDER AGE 18 EXCLUDED FROM COVERAGE- Section 210(a) of such Act (42 U.S.C. 410(a)) is amended--

          (i) by striking ‘or’ at the end of paragraph (19),

          (ii) by striking the period at the end of paragraph (20) and inserting ‘; or’, and

          (iii) by adding at the end the following new paragraph:

      ‘(21) [Struck out->] domestic [<-Struck out] Domestic service in a private home of the employer performed in any year by an individual under the age of 18 during any portion of such year.’.

      [Struck out->] (3) EFFECTIVE DATE- The amendments made by this subsection shall apply to remuneration paid in calendar years beginning after December 31, 1993. [<-Struck out]

      (3) EFFECTIVE DATES-

        (A) IN GENERAL- Except as provided in subparagraph (B), the amendments made by this subsection shall apply to remuneration paid in calendar years beginning after December 31, 1994.

        (B) EXCLUDED EMPLOYMENT- The amendments made by paragraphs (1)(C) and (2)(B) shall apply to services performed after December 31, 1994.

    (b) COORDINATION OF COLLECTION OF DOMESTIC SERVICE EMPLOYMENT WITH COLLECTION OF INCOME TAXES-

      (1) IN GENERAL- Chapter 25 of the Internal Revenue Code of 1986 (relating to general provisions relating to employment taxes) is amended by adding at the end thereof the following new section:

‘SEC. 3510. COORDINATION OF COLLECTION OF DOMESTIC SERVICE EMPLOYMENT TAXES WITH COLLECTION OF INCOME TAXES.

    ‘(a) GENERAL RULE- Except as otherwise provided in this section--

      ‘(1) returns with respect to domestic service employment taxes shall be made on a calendar year basis,

      ‘(2) any such return for any calendar year shall be filed on or before the 15th day of the 4th month following the close of the employer’s taxable year which begins in such calendar year, and

      ‘(3) no requirement to make deposits (or to pay installments under section 6157) shall apply with respect to such taxes.

    ‘(b) DOMESTIC SERVICE EMPLOYMENT TAXES SUBJECT TO ESTIMATED TAX PROVISIONS-

      ‘(1) IN GENERAL- Solely for purposes of section 6654, domestic service employment taxes imposed with respect to any calendar year shall be treated as a tax imposed by chapter 2 for the taxable year of the employer which begins in such calendar year.

      ‘(2) SPECIAL RULE WHERE TAXES ARE PAID ON OR BEFORE APRIL 15- If, on or before the date described in subsection (a)(2) or, if earlier, the date the return is filed, the employer pays in full the domestic service employment taxes computed on such return as payable for any calendar year, then no addition to tax shall be imposed under section 6654(a) with respect to any underpayment of any required installment of such taxes for the taxable year beginning in such calendar year.

      ‘(3) ANNUALIZATION- Under regulations prescribed by the Secretary, appropriate adjustments shall be made in the application of section 6654(d)(2) in respect of the amount treated as tax under paragraph (1).

      ‘(4) TRANSITIONAL RULE- For purposes of applying section 6654 to a taxable year beginning in [Struck out->] 1994 [<-Struck out] 1995, the amount referred to in clause (ii) of section 6654(d)(1)(B) shall be increased by 90 percent of the amount treated as tax under paragraph (1) for such preceding taxable year.

    ‘(c) DOMESTIC SERVICE EMPLOYMENT TAXES- For purposes of this section, the term ‘domestic service employment taxes’ means--

      ‘(1) any taxes imposed by chapter 21 or 23 on remuneration paid for domestic service in a private home of the employer, and

      ‘(2) any amount withheld from such remuneration pursuant to an agreement under section 3402(p).

    For purposes of this subsection, the term ‘domestic service in a private home of the employer’ [Struck out->] does not include service [<-Struck out] includes domestic service described in section 3121(g)(5).

    ‘(d) EXCEPTION WHERE EMPLOYER LIABLE FOR OTHER EMPLOYMENT TAXES- To the extent provided in regulations prescribed by the Secretary, this section shall not apply to any employer for any calendar year if such employer is liable for any tax under this subtitle with respect to remuneration for services other than domestic service in a private home of the employer.

    ‘(e) GENERAL REGULATORY AUTHORITY- The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section. Such regulations may treat domestic service employment taxes as taxes imposed by chapter 1 for purposes of coordinating the assessment and collection of such employment taxes with the assessment and collection of domestic employers’ income taxes.

    ‘(f) AUTHORITY TO ENTER INTO AGREEMENTS TO COLLECT STATE UNEMPLOYMENT TAXES-

      ‘(1) IN GENERAL- The Secretary is hereby authorized to enter into an agreement with any State to collect, as the agent of such State, such State’s unemployment taxes imposed on remuneration paid for domestic service in a private home of the employer. Any taxes to be collected by the Secretary pursuant to such an agreement shall be treated as domestic service employment taxes for purposes of this section.

      ‘(2) TRANSFERS TO STATE ACCOUNT- Any amount collected under an agreement referred to in paragraph (1) shall be transferred by the Secretary to the account of the State in the Unemployment Trust Fund.

      ‘(3) SUBTITLE F MADE APPLICABLE- For purposes of subtitle F, any amount required to be collected under an agreement under paragraph (1) shall be treated as a tax imposed by chapter 23.

      ‘(4) STATE- For purposes of this subsection, the term ‘State’ has the meaning given such term by section 3306(j)(1).’

      (2) CLERICAL AMENDMENT- The table of sections for chapter 25 of such Code is amended by adding at the end thereof the following:

‘Sec. 3510. Coordination of collection of domestic service employment taxes with collection of income taxes.’

      (3) EFFECTIVE DATE- The amendments made by this subsection shall apply to remuneration paid in calendar years beginning after December 31, [Struck out->] 1993 [<-Struck out] 1994.

      (4) EXPANDED INFORMATION TO EMPLOYERS- The Secretary of the Treasury or his delegate shall prepare and make available information on the Federal tax obligations of employers with respect to employees performing domestic service in a private home of the employer. Such information shall also include a statement that such employers may have obligations with respect to such employees under State laws relating to unemployment insurance and workers compensation.

SEC. 3. ADDITIONAL DEBT COLLECTION PRACTICES.

    (a) IN GENERAL- Section 204 of the Social Security Act (42 U.S.C. 404) is amended by adding at the end the following new subsection:

    ‘(f)(1) With respect to any delinquent amount, the Secretary may use the collection practices described in sections 3711(f), 3716, and 3718 of title 31, United States Code, as in effect on April 1, 1994.

    ‘(2) For purposes of paragraph (1), the term ‘delinquent amount’ means an amount--

      ‘(A) in excess of the correct amount of payment under this title;

      ‘(B) paid to a person after such person has attained 18 years of age; and

      ‘(C) determined by the Secretary, under regulations, to be otherwise unrecoverable under this section after such person ceases to be a beneficiary under this title.’.

    (b) CONFORMING AMENDMENT- Section 3701(d) of title 31, United States Code, is amended by inserting ‘, except to the extent provided under section 204(f) of such Act (42 U.S.C. 404(f)),’ after ‘the Social Security Act (42 U.S.C. 301 et seq.)’.

    (c) EFFECTIVE DATE- The amendments made by this section shall apply to collection activities begun on or after the date of the enactment of this Act and before October 1, 1999.

SEC. 4. PROHIBITION ON PAYMENT OF BENEFITS TO CERTAIN INDIVIDUALS CONFINED BY COURT ORDER TO PUBLIC INSTITUTIONS.

    (a) IN GENERAL- Section 202(x)(1) of the Social Security Act (42 U.S.C. 402(x)(1)) is amended--

      (1) by inserting ‘(A)’ after ‘(1)’, and

      (2) by adding at the end the following new subparagraph:

    ‘(B) Notwithstanding any other provision of this title, no monthly benefits shall be paid under this section or under section 223 to any individual for any month during which such individual is confined in any public institution by a court order pursuant to a verdict or finding that the individual is--

      ‘(i) guilty of an offense described in subparagraph (A), but insane (or having a similar condition, such as a mental disease, a mental defect, or mental incompetence); or

      ‘(ii) not guilty of such an offense by reason of insanity (or by reason of a similar finding, such as a mental disease, a mental defect, or mental incompetence).’.

    (b) CONFORMING AMENDMENTS-

      (1) Section 202(x)(3) of the Social Security Act (42 U.S.C. 402(x)(3)) is amended by striking ‘any individual’ and all that follows and inserting ‘any individual confined as described in paragraph (1) if the jail, prison, penal institution, correctional facility, or other public institution to which such individual is so confined is under the jurisdiction of such agency and the Secretary requires such information to carry out the provisions of this section.’.

      (2) The heading for section 202(x) of such Act is amended by inserting ‘and Certain Other Inmates of Public Institutions’ after ‘Prisoners’.

    (c) EFFECTIVE DATE- The amendments made by this section shall apply with respect to benefits for months commencing after 90 days after the date of the enactment of this Act.

SEC. 5. NURSING HOMES REQUIRED TO REPORT ADMISSIONS OF SSI RECIPIENTS.

    (a) IN GENERAL- Section 1631(e)(1) (42 U.S.C. 1383(e)(1)) is amended by adding at the end the following new subparagraph:

    ‘(C) For purposes of making determinations under section 1611(e), the requirements prescribed by the Secretary pursuant to subparagraph (A) shall require each administrator of a nursing home, extended care facility, or intermediate care facility to report to the Secretary of the admission of any eligible individual or eligible spouse receiving benefits under this title within 2 weeks of such admission.’.

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to admissions occurring on or after October 1, 1995.