Internal Revenue Code:Sec. 3111. Rate of tax
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Location in Internal Revenue Code
TITLE 26 - INTERNAL REVENUE CODE
Subtitle C - Employment Taxes
CHAPTER 21 - FEDERAL INSURANCE CONTRIBUTIONS ACT
Subchapter B - Tax on Employers
Statute
Sec. 3111. Rate of tax
(a) Old-age, survivors, and disability insurance
In addition to other taxes, there is hereby imposed on every
employer an excise tax, with respect to having individuals in his
employ, equal to the following percentages of the wages (as defined
in section 3121(a)) paid by him with respect to employment (as
defined in section 3121(b)) -
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In cases of wages paid during: The rate shall be:
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1984, 1985, 1986, or 1987 5.7 percent
1988 or 1989 6.06 percent
1990 or thereafter 6.2 percent.
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(b) Hospital insurance
In addition to the tax imposed by the preceding subsection, there
is hereby imposed on every employer an excise tax, with respect to
having individuals in his employ, equal to the following
percentages of the wages (as defined in section 3121(a)) paid by
him with respect to employment (as defined in section 3121(b)) -
(1) with respect to wages paid during the calendar years 1974
through 1977, the rate shall be 0.90 percent;
(2) with respect to wages paid during the calendar year 1978,
the rate shall be 1.00 percent;
(3) with respect to wages paid during the calendar years 1979
and 1980, the rate shall be 1.05 percent;
(4) with respect to wages paid during the calendar years 1981
through 1984, the rate shall be 1.30 percent;
(5) with respect to wages paid during the calendar year 1985,
the rate shall be 1.35 percent; and
(6) with respect to wages paid after December 31, 1985, the
rate shall be 1.45 percent.
(c) Relief from taxes in cases covered by certain international
agreements
During any period in which there is in effect an agreement
entered into pursuant to section 233 of the Social Security Act
with any foreign country, wages received by or paid to an
individual shall be exempt from the taxes imposed by this section
to the extent that such wages are subject under such agreement
exclusively to the laws applicable to the social
security system of such foreign country.
Sources
(Aug. 16, 1954, ch. 736, 68A Stat. 416; Sept. 1, 1954, ch. 1206,
title II, Sec. 208(c), 68 Stat. 1094; Aug. 1, 1956. ch. 836, title
II, Sec. 202(c), 70 Stat. 845; Pub. L. 85-840, title IV, Sec.
401(c), Aug. 28, 1958, 72 Stat. 1042; Pub. L. 87-64, title II, Sec.
201(c), June 30, 1961, 75 Stat. 141; Pub. L. 89-97, title I, Sec.
111(c)(6), title III, Sec. 321(c), July 30, 1965, 79 Stat. 343,
396; Pub. L. 90-248, title I, Sec. 109(a)(3), (b)(3), Jan. 2, 1968,
81 Stat. 836, 837; Pub. L. 92-5, title II, Sec. 204(a)(2), Mar. 17,
1971, 85 Stat. 11; Pub. L. 92-336, title II, Sec. 204(a)(3),
(b)(3), July 1, 1972, 86 Stat. 421, 422; Pub. L. 92-603, title I,
Sec. 135(a)(3), (b)(3), Oct. 30, 1972, 86 Stat. 1363, 1364; Pub. L.
93-233, Sec. 6(a)(2), (b)(3), Dec. 31, 1973, 87 Stat. 954, 955;
Pub. L. 94-455, title XIX, Sec. 1903(a)(1), Oct. 4, 1976, 90 Stat.
1806; Pub. L. 95-216, title I, Sec. 101(a)(2), (b)(2), title III,
Sec. 315(b), 317(b)(2), Dec. 20, 1977, 91 Stat. 1511, 1512, 1537,
1540; Pub. L. 98-21, title I, Sec. 123(a)(2), Apr. 20, 1983, 97
Stat. 88; Pub. L. 100-203, title IX, Sec. 9006(b)(1), Dec. 22,
1987, 101 Stat. 1330-289; Pub. L. 100-647, title VIII, Sec.
8016(a)(5), Nov. 10, 1988, 102 Stat. 3793.)
References in Text
REFERENCES IN TEXT
Section 233 of the Social Security Act, referred to in subsec.
(c), is classified to section 433 of Title 42, The Public Health
and Welfare.
Miscellaneous
AMENDMENTS
2004 - Pub. L. 108-203, Sec. 415. Section 3111(c)is amended by
striking ``to taxes or contributions for similar purposes under'' and
inserting ``exclusively to the laws applicable to''.
1988 - Subsecs. (a), (b). Pub. L. 100-647 made technical
correction to directory language of Pub. L. 100-203, Sec.
9006(b)(1), see 1987 Amendment note below.
1987 - Subsecs. (a), (b). Pub. L. 100-203, as amended by Pub. L.
100-647, struck out ''and (t)'' after ''3121(a)'' in introductory
provisions.
1983 - Subsec. (a). Pub. L. 98-21 substituted table of rates for
pars. (1) to (7) which had imposed a tax on every employer (1) with
respect to wages paid during the calendar years 1974 through 1977
at the rate of 4.95 percent, (2) with respect to wages paid during
the calendar year 1978 at the rate of 5.05 percent, (3) with
respect to wages paid during the calendar years 1979 and 1980 at
the rate of 5.08 percent, (4) with respect to wages paid during the
calendar year 1981 at the rate of 5.35 percent, (5) with respect to
wages paid during the calendar years 1982 through 1984 at the rate
of 5.40 percent, (6) with respect to wages paid during the calendar
years 1985 through 1989 at the rate of 5.70 percent, and (7) with
respect to wages paid after Dec. 31, 1989, at the rate of 6.20
percent.
1977 - Subsec. (a). Pub. L. 95-216, Sec. 101(a)(2), 315(b),
substituted ''(as defined in section 3121(a) and (t))'' for ''(as
defined in section 3121(a))'' in provisions preceding par. (1),
substituted ''1974 through 1977'' for ''1974 through 2010'' in par.
(1), substituted ''wages paid during the calendar year 1978, the
rate shall be 5.05 percent'' for ''wages paid after December 31,
2010, the rate shall be 5.95 percent'' in par. (2), and added pars.
(3) to (7).
Subsec. (b). Pub. L. 95-216, Sec. 101(b)(2), 315(b), substituted
''(as defined in section 3121(a) and (t))'' for ''(as defined in
section 3121(a))'' in provisions preceding par. (1), substituted
''wages paid during the calendar year 1978, the rate shall be 1.00
percent'' for ''wages paid during the calendar years 1978 through
1980, the rate shall be 1.10 percent'', in par. (2), substituted
''wages paid during the calendar years 1979 and 1980, the rate
shall be 1.05 percent'' for wages paid during the calendar years
1981 through 1985, the rate shall be 1.35 percent'' in par. (3),
substituted ''wages paid during the calendar years 1981 through
1984, the rate shall be 1.30 percent'' for ''wages paid after
December 31, 1985, the rate shall be 1.50 percent'' in par. (4),
and added pars. (5) and (6).
Subsec. (c). Pub. L. 95-216, Sec. 317(b)(2), added subsec. (c).
1976 - Subsec. (a). Pub. L. 94-455, Sec. 1903(a)(1)(A),
redesignated pars. (5) and (6) as (1) and (2). Former pars. (1) to
(4), which related to a tax rate of 3.8 percent with respect to
wages received during the taxable year 1968, a tax rate of 4.2
percent with respect to wages received during the calendar year
1969 and 1970, a tax rate of 4.6 percent with respect to wages
received during the calendar years 1971 and 1972, and a tax rate of
4.85 percent with respect to wages received during the calendar
year 1973, respectively, were struck out.
Subsec. (b). Pub. L. 94-455, Sec. 1903(a)(1)(B), redesignated
pars. (3) to (6) as (1) to (4), respectively. Former pars. (1) and
(2), which related to a tax rate of .60 percent with respect to
wages received during the calendar years 1968, 1969, 1970, 1971,
and 1972 and a tax rate of 1.0 percent with respect to wages
received during the calendar year 1973, respectively, were struck
out.
1973 - Subsec. (a)(4). Pub. L. 93-233, Sec. 6(a)(2), struck out
provision for application of 4.85 percent rate of tax during
calendar years 1974, 1975, 1976, and 1977.
Subsec. (a)(5). Pub. L. 93-233, Sec. 6(a)(2), increased rate of
tax from 4.80 percent to 4.95 percent and substituted calendar year
''1974'' to ''1978'' as initial year for application of such rate.
Subsec. (a)(6). Pub. L. 93-233, Sec. 6(a)(2), increased rate of
tax from 5.85 percent to 5.95 percent.
Subsec. (b)(2). Pub. L. 93-233, Sec. 6(b)(3), struck out
provision for application of 1.0 percent rate of tax during
calendar years 1974, 1975, 1976, and 1977.
Subsec. (b)(3). Pub. L. 93-233, Sec. 6(b)(3), incorporated former
provision of par. (2) for taxation of wages received during
calendar years 1974, 1975, 1976, and 1977, decreased the applicable
rate of tax from 1.0 percent to 0.90 percent, and struck out
provision for 1.25 percent rate of tax for calendar years 1978,
1979, and 1980.
Subsec. (b)(4). Pub. L. 93-233, Sec. 6(b)(3), incorporated former
provision of par. (3) for taxation of wages received during
calendar years 1978, 1979, and 1980, decreased the applicable rate
of tax from 1.25 percent to 1.10 percent, and struck out provision
for 1.35 percent rate of tax for calendar years 1981, 1982, 1983,
1984, and 1985.
Subsec. (b)(5). Pub. L. 93-233, Sec. 6(b)(3), incorporated former
provision of par. (4) for taxation of wages received during
calendar years 1981 through 1985 at applicable 1.35 percent rate of
tax and struck out provision for 1.45 percent rate of tax for wages
received after Dec. 31, 1985.
Subsec. (b)(6). Pub. L. 93-233, Sec. 6(b)(3), incorporated former
provision of par. (5) for taxation of wages received after Dec. 31,
1985 and increased the applicable rate of tax from 1.45 percent to
1.50 percent.
1972 - Subsec. (a)(3). Pub. L. 92-603, Sec. 135(a)(3)(A),
substituted ''the calendar years 1971 and 1972'' for ''any of the
calendar years 1971 through 1977''.
Subsec. (a)(3) to (5). Pub. L. 92-336, Sec. 204(a)(3),
substituted ''any of the calendar years 1971 through 1977'' for
''the calendar years 1971 and 1972'' in par. (3), ''any of the
calendar years 1978 through 2010'' for ''the calendar years 1973,
1974, and 1975'' and ''4.5'' for ''5.0'' in par. (4), and
''December 31, 2010'' for ''December 31, 1975'' and ''5.35'' for
''5.15'' in par. (5).
Subsec. (a)(4). Pub. L. 92-603, Sec. 135(a)(3)(B), substituted
''received during the calendar years 1973, 1974, 1975, 1976, and
1977, the rate shall be 4.85 percent;'' for ''received during any
of the calendar years 1978 through 2010, the rate shall be 4.5
percent; and''.
Subsec. (a)(5). Pub. L. 92-603, Sec. 135(a)(3)(B), substituted
''received during the calendar years 1978 through 2010, the rate
shall be 4.80 percent; and'' for ''received after December 31,
2010, the rate shall be 5.35 percent''.
Subsec. (a)(6). Pub. L. 92-603, Sec. 135(a)(3)(B), added par.
(6).
Subsec. (b)(2). Pub. L. 92-603, Sec. 135(b)(3), increased rate to
1.0 percent from 0.9 percent.
Subsec. (b)(2) to (5). Pub. L. 92-336, Sec. 204(b)(3), inserted
references to 1976 and 1977 and substituted ''0.9'' for ''0.65'' in
par. (2), substituted references for the calendar years 1978
through 1985 for references to the calendar years 1976 through 1979
and substituted ''1.0'' for ''0.70'' in par. (3), substituted
references for the calendar years 1986 through 1992 for references
to the calendars 1980 through 1986 and substituted ''1.1'' for
''0.80'' in par. (4), and substituted ''1992'' and ''1986'' and
''1.2'' for ''0.9'' in par. (5).
Subsec. (b)(3). Pub. L. 92-603, Sec. 135(b)(3), substituted ''and
1980, the rate shall be 1.25 percent'' for ''1980, 1981, 1982,
1983, 1984, and 1985, the rate shall be 1.0 percent''.
Subsec. (b)(4). Pub. L. 92-603, Sec. 135(b)(3), substituted
''1981, 1982, 1983, 1984, and 1985, the rate shall be 1.35
percent'' for ''1986, 1987, 1988, 1989, 1990, 1991, and 1992, the
rate shall be 1.1 percent''.
Subsec. (b)(5). Pub. L. 92-603, Sec. 135(b)(3), substituted
''1985, the rate shall be 1.45 percent'' for ''1992, the rate shall
be 1.2 percent''.
1971 - Subsec. (a)(4). Pub. L. 92-5 substituted ''with respect to
wages paid during the calendar years 1973, 1974, and 1975, the rate
shall be 5.0 percent; and'' for ''with respect to wages paid after
December 31, 1972, the rate shall be 5.0 percent''.
Subsec. (a)(5). Pub. L. 92-5 added par. (5).
1968 - Subsec. (a)(1) to (4). Pub. L. 90-248, Sec. 109(a)(3),
substituted ''1968'' and ''3.8'' for ''1966'' and ''3.85'' in par.
(1) and ''1969 and 1970'' and ''4.2'' for ''1967 and 1968'' and
''3.9'' in par. (2), struck out reference to calendar years 1969
and 1970 from par. (3) and substituted therein ''4.6'' for ''4.4'',
and substituted ''5.0'' for ''4.85'' in par. (4).
Subsecs. (b)(1) to (5). Pub. L. 90-248, Sec. 109(b)(3), struck
out par. (1) provision for employer rate of 0.35 percent of wages
paid with respect to employment during calendar year 1966,
redesignated pars. (2) to (6) as (1) to (5), struck out reference
to ''1967'' in such par. (1) and increased the rate by 0.10 percent
to 0.60, 0.65, 0.70, 0.80, and 0.90 in pars. (1) to (5),
respectively.
1965 - Pub. L. 89-97, Sec. 321(c), divided the total excise tax
imposed under the entire section upon employers through a tax equal
to percentages of wages paid by him into two separate taxes by
dividing the section into subsecs. (a) and (b), with subsec. (a)
reflecting the tax for old-age, survivors, and disability
insurance, and subsec. (b) reflecting the tax for hospital
insurance, but, in the case of subsec. (b), without regard to the
provisions of section 3121(b)(9) insofar as it relates to
employees; increased from 4 1/8 percent to 4.20 percent the rate of
total tax imposed by the entire section upon wages paid during
calendar year 1966 (resulting from a tax of 3.85 percent under
subsec. (a) and 0.35 percent under subsec. (b)), increased from 4
1/8 percent to 4.40 percent the rate of total tax imposed by the
entire section upon wages paid during calendar year 1967 (resulting
from a tax of 3.9 percent under subsec. (a) and 0.50 percent under
subsec. (b)), reduced from 4 5/8 percent to 4.40 percent the rate
of total tax imposed by the entire section upon wages paid during
calendar year 1968 (resulting from a tax of 3.9 percent under
subsec. (a) and 0.50 percent under subsec. (b)), increased from 4
5/8 percent to 4.90 percent the rate of total tax imposed by the
entire section upon wages paid during the calendar years 1969,
1970, 1971, and 1972 (resulting from a tax of 4.4 percent under
subsec. (a) and 0.50 percent under subsec. (b)), increased from 4
5/8 percent to 5.40 percent the rate for calendar years 1973, 1974,
and 1975 (resulting from a tax of 4.85 percent under subsec. (a)
and 0.55 percent under subsec. (b)), increased from 4 5/8 percent
to 5.45 percent the rate for calendar years 1976, 1977, 1978, and
1979 (resulting from a tax of 4.85 percent under subsec. (a) and
0.60 percent under subsec. (b)), increased from 4 5/8 percent to
5.55 percent the rate for calendar years 1980 through 1986
(resulting from a tax of 4.85 percent under subsec. (a) and 0.70
percent under subsec. (b)), and increased the rate from 4 5/8
percent to 5.65 percent for calendar years after December 31, 1986
(resulting from a tax of 4.85 percent under subsec. (a) and 0.80
percent under subsec. (b)).
Subsec. (b). Pub. 89-97, Sec. 111(c)(6), struck out '', but
without regard to the provisions of paragraph (9) thereof insofar
as it relates to employees'' after ''as defined in section
3121(b)''.
1961 - Pub. L. 87-64 increased rate of tax for calendar year 1962
from 3 to 3 1/8 percent, calendar years 1963 to 1965, inclusive,
from 3 1/2 to 3 5/8 percent, calendar years 1966 and 1967 from 4 to
4 1/8 percent, calendar year 1968 from 4 to 4 5/8 percent, and for
calendar years after December 31, 1968, from 4 1/2 to 4 5/8
percent.
1958 - Pub. L. 85-840 increased rate of tax by substituting
provisions imposing a tax of 2 1/2 percent for calendar year 1959,
3 percent for calendar years 1960-62, 3 1/2 percent for calendar
years 1963-65, 4 percent for calendar years 1966-68, and 4 1/2
percent for calendar years beginning after Dec. 31, 1968, for
provisions which imposed a tax of 2 1/4 percent for calendar years
1957-59, 2 3/4 percent for calendar years 1960-64, 3 1/4 percent
for calendar years 1965-69, 3 3/4 percent for calendar years
1970-74, and 4 1/4 percent for calendar years beginning after Dec.
31, 1974.
1956 - Act Aug. 1, 1956, increased rate of tax with respect to
wages paid during calendar years 1957 to 1959, and for all calendar
years thereafter, by one-quarter percent.
1954 - Act Sept. 1, 1954, increased 3 1/4 percent rate of tax for
calendar year 1970 and subsequent years to 3 1/2 percent for
calendar years 1970 to 1974 and 4 percent for 1975 and subsequent
years.
EFFECTIVE DATE OF 1988 AMENDMENT
Section 8016(b) of Pub. L. 100-647 provided that:
''(1) Except as provided in paragraph (2), the amendments made by
this section (amending this section, sections 3121 and 3306 of this
title, and sections 405, 410, and 411 of Title 42, The Public
Health and Welfare) shall be effective on the date of the enactment
of this Act (Nov. 10, 1988).
''(2) Any amendment made by this section to a provision of a
particular Public Law which is referred to by its number, or to a
provision of the Social Security Act (42 U.S.C. 301 et seq.) or the
Internal Revenue Code of 1986 as added or amended by a provision of
a particular Public Law which is so referred to, shall be effective
as though it had been included or reflected in the relevant
provisions of that Public Law at the time of its enactment.''
EFFECTIVE DATE OF 1987 AMENDMENT
Section 9006(c) of Pub. L. 100-203 provided that: ''The
amendments made by this section (amending this section and section
3121 of this title) shall apply with respect to tips received (and
wages paid) on and after January 1, 1988.''
EFFECTIVE DATE OF 1983 AMENDMENT
Amendment by Pub. L. 98-21 applicable to remuneration paid after
Dec. 31, 1983, see section 123(a)(3) of Pub. L. 98-21, set out as a
note under section 3101 of this title.
EFFECTIVE DATE OF 1977 AMENDMENT
Amendment by section 101(a)(2), (b)(2) of Pub. L. 95-216
applicable with respect to remuneration paid or received, and
taxable years beginning, after 1977, see section 104 of Pub. L.
95-216, set out as a note under section 1401 of this title.
Section 315(c) of Pub. L. 95-216 provided that: ''The amendments
made by this section (amending this section and section 3121 of
this title) shall apply with respect to wages paid with respect to
employment performed in months after December 1977.''
EFFECTIVE DATE OF 1976 AMENDMENT
Amendment by Pub. L. 94-455 applicable with respect to wages paid
after Dec. 31, 1976, see section 1903(d) of Pub. L. 94-455, set out
as a note under section 3101 of this title.
EFFECTIVE DATE OF 1973 AMENDMENT
Amendment by Pub. L. 93-233 applicable only with respect to
remuneration paid after December 31, 1973, see section 6(c) of Pub.
L. 93-233, set out as a note under section 1401 of this title.
EFFECTIVE DATE OF 1972 AMENDMENTS
Amendment by Pub. L. 92-603 applicable only with respect to
remuneration paid after Dec. 31, 1972, see section 135(c) of Pub.
L. 92-603, set out as a note under section 1401 of this title.
Amendment by Pub. L. 92-336 applicable only with respect to
remuneration paid after December 31, 1972, see section 204(c) of
Pub. L. 92-336, set out as a note under section 1401 of this title.
EFFECTIVE DATE OF 1971 AMENDMENT
Amendment by Pub. L. 92-5 applicable only with respect to
remuneration paid after Dec. 31, 1971, see section 204(b) of Pub.
L. 92-5, set out as a note under section 3101 of this title.
EFFECTIVE DATE OF 1968 AMENDMENT
Amendment by Pub. L. 90-248 applicable only with respect to
remuneration paid after Dec. 31, 1967, see section 109(c) of Pub.
L. 90-248, set out as a note under section 1401 of this title.
EFFECTIVE DATE OF 1965 AMENDMENT
Amendment by section 111(c)(6) of Pub. L. 89-97 applicable to
calendar year 1966 or to any subsequent calendar year but only if
by October 1 immediately preceding such calendar year the Railroad
Retirement Tax Act (section 3201 et seq. of this title) provides
for a maximum amount of monthly compensation taxable under such Act
during all months of such calendar year equal to one-twelfth of
maximum wages which Federal Insurance Contributions Act (section
3101 et seq. of this title) provides may be counted for such
calendar year, see section 111(e) of Pub. L. 89-97, set out as an
Effective Date note under section 1395i-1 of Title 42, The Public
Health and Welfare.
Amendment by section 321(c) of Pub. L. 89-97 applicable with
respect to remuneration paid after December 31, 1965, see section
321(d) of Pub. L. 89-97, set out as a note under section 1401 of
this title.
EFFECTIVE DATE OF 1961 AMENDMENT
Amendment by Pub. L. 87-64 applicable with respect to
remuneration paid after Dec. 31, 1961, see section 201(d) of Pub.
L. 87-64, set out as a note under section 1401 of this title.
EFFECTIVE DATE OF 1958 AMENDMENT
Amendment by Pub. L. 85-840 applicable with respect to
remuneration paid after Dec. 31, 1958, see section 401(d) of Pub.
L. 85-840, set out as a note under section 1401 of this title.
EFFECTIVE DATE OF 1956 AMENDMENT
Amendment by act Aug. 1, 1956, applicable with respect to
remuneration paid after Dec. 31, 1956, see section 202(d) of such
act Aug. 1, 1956, set out as a note under section 1401 of this
title.
PENALTIES AND INTEREST NOT ASSESSED FOR FAILURE TO MAKE TIMELY
PAYMENT DURING PERIOD JANUARY 1, 1982, TO JUNE 30, 1982, OF TAXES
ATTRIBUTABLE TO AMENDMENTS BY PUB. L. 97-123
For provision that no penalties or interest shall be assessed on
account of any failure to make timely payment of taxes imposed by
this section with respect to payments made for the period Jan. 1,
1982, and ending June 30, 1982, to the extent that such taxes are
attributable to section 3 of Pub. L. 97-123 or the amendments made
by that section, see section 3(f) of Pub. L. 97-123, set out as a
note under section 3101 of this title.
References
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 45B, 401, 3112, 3121,
3122, 3125, 3126, 3127, 3211, 3221, 3507, 6051, 6205, 6413, 6674,
6690 of this title; title 2 sections 162b, 658a, 1503; title 10
section 2467; title 40 section 214d; title 42 sections 401, 401a,
418, 429, 910, 1395i, 1395i-2, 1395ww, 12594.
