Internal Revenue Code:Sec. 3127. Exemption for employers and their employees where both are members of religious faiths opposed to participation in Social Security Act programs

From TaxAlmanac

Location in Internal Revenue Code

     TITLE 26 - INTERNAL REVENUE CODE
      Subtitle C - Employment Taxes
       CHAPTER 21 - FEDERAL INSURANCE CONTRIBUTIONS ACT
        Subchapter C - General Provisions
      

Statute

    Sec. 3127. Exemption for employers and their employees where both
        are members of religious faiths opposed to participation in
        Social Security Act programs
 
    (a) In general
      Notwithstanding any other provision of this chapter (and under
    regulations prescribed to carry out this section), in any case
    where -
        (1) an employer (or, if the employer is a partnership, each
      partner therein) is a member of a recognized religious sect or
      division thereof described in section 1402(g)(1) and an adherent
      of established tenets or teachings of such sect or division as
      described in such section, and has filed and had approved under
      subsection (b) an application (in such form and manner, and with
      such official, as may be prescribed by such regulations) for an
      exemption from the taxes imposed by section 3111, and
        (2) an employee of such employer who is also a member of such a
      religious sect or division and an adherent of its established
      tenets or teachings has filed and had approved under subsection
      (b) an identical application for exemption from the taxes imposed
      by section 3101,
    such employer shall be exempt from the taxes imposed by section
    3111 with respect to wages paid to each of the employees thereof
    who meets the requirements of paragraph (2) and each such employee
    shall be exempt from the taxes imposed by section 3101 with respect
    to such wages paid to him by such employer.
    (b) Approval of application
      An application for exemption filed by an employer (or a partner)
    under subsection (a)(1) or by an employee under subsection (a)(2)
    shall be approved only if -
        (1) such application contains or is accompanied by the evidence
      described in section 1402(g)(1)(A) and a waiver described in
      section 1402(g)(1)(B),
        (2) the Commissioner of Social Security makes the findings
      (with respect to such sect or division) described in section
      1402(g)(1)(C), (D), and (E), and
        (3) no benefit or other payment referred to in section
      1402(g)(1)(B) became payable (or, but for section 203 or 222(b)
      (FOOTNOTE 1) of the Social Security Act, would have become
      payable) to the individual filing the application at or before
      the time of such filing.
       (FOOTNOTE 1) See References in Text note below.
    (c) Effective period of exemption
      An exemption granted under this section to any employer with
    respect to wages paid to any of the employees thereof, or granted
    to any such employee, shall apply with respect to wages paid by
    such employer during the period -
        (1) commencing with the first day of the first calendar
      quarter, after the quarter in which such application is filed,
      throughout which such employer (or, if the employer is a
      partnership, each partner therein) or employee meets the
      applicable requirements specified in subsections (a) and (b), and
        (2) ending with the last day of the calendar quarter preceding
      the first calendar quarter thereafter in which (A) such employer
      (or, if the employer is a partnership, any partner therein) or
      the employee involved does not meet the applicable requirements
      of subsection (a), or (B) the sect or division thereof of which
      such employer (or, if the employer is a partnership, any partner
      therein) or employee is a member is found by the Commissioner of
      Social Security to have ceased to meet the requirements of
      subsection (b)(2).
 

Sources

    (Added Pub. L. 100-647, title VIII, Sec. 8007(a)(1), Nov. 10, 1988,
    102 Stat. 3781; amended Pub. L. 101-239, title X, Sec. 10204(b)(1),
    Dec. 19, 1989, 103 Stat. 2474; Pub. L. 103-296, title I, Sec.
    108(h)(3), Aug. 15, 1994, 108 Stat. 1487.)
 

References in Text

                             REFERENCES IN TEXT
      Sections 203 and 222(b) of the Social Security Act, referred to
    in subsec. (b)(3), are classified to sections 403 and 422(b),
    respectively, of Title 42, The Public Health and Welfare. Section
    222(b) was repealed by Pub. L. 106-170, title I, Sec. 101(b)(1)(C),
    Dec. 17, 1999, 113 Stat. 1873.
 

Miscellaneous

                              PRIOR PROVISIONS
      A prior section 3127 was renumbered section 3128 of this title.
                                 AMENDMENTS
      1994 - Subsecs. (b)(2), (c)(2). Pub. L. 103-296 substituted
    ''Commissioner of Social Security'' for ''Secretary of Health and
    Human Services''.
      1989 - Subsec. (a). Pub. L. 101-239, Sec. 10204(b)(1)(B),
    substituted ''the employees thereof'' for ''his employees'' in
    concluding provisions.
      Subsec. (a)(1). Pub. L. 101-239, Sec. 10204(b)(1)(A), inserted
    ''(or, if the employer is a partnership, each partner therein)''
    after ''an employer''.
      Subsec. (b). Pub. L. 101-239, Sec. 10204(b)(1)(C), inserted ''(or
    a partner)'' after ''an employer'' in introductory provisions.
      Subsec. (c). Pub. L. 101-239, Sec. 10204(b)(1)(D), substituted
    ''the employees thereof'' for ''his employees'' in introductory
    provisions.
      Subsec. (c)(1). Pub. L. 101-239, Sec. 10204(b)(1)(E), inserted
    ''(or, if the employer is a partnership, each partner therein)''.
      Subsec. (c)(2). Pub. L. 101-239, Sec. 10204(b)(1)(F), substituted
    ''such employer (or, if the employer is a partnership, any partner
    therein) or the employee involved does not meet'' for ''such
    employer or the employee involved ceases to meet'' in cl. (A) and
    inserted ''(or, if the employer is a partnership, any partner
    therein)'' after ''such employer'' in cl. (B).
                      EFFECTIVE DATE OF 1994 AMENDMENT
      Amendment by Pub. L. 103-296 effective Mar. 31, 1995, see section
    110(a) of Pub. L. 103-296, set out as a note under section 401 of
    Title 42, The Public Health and Welfare.
                      EFFECTIVE DATE OF 1989 AMENDMENT
      Section 10204(b)(2) of Pub. L. 101-239 provided that: ''The
    amendments made by this subsection (amending this section) shall be
    effective as if they were included in the amendments made by
    section 8007(a)(1) of the Technical and Miscellaneous Revenue Act
    of 1988 (102 Stat. 3781) (Pub. L. 100-647).''
                               EFFECTIVE DATE
      Section applicable to wages paid after Dec. 31, 1988, see section
    8007(d) of Pub. L. 100-647, set out as an Effective Date of 1988
    Amendment note under section 1402 of this title.
 

References

                   SECTION REFERRED TO IN OTHER SECTIONS
      This section is referred to in title 42 section 402.