(5) 5-year benefit cost rate.. For purposes of subparagraph (C) of subsection (c) (3), the 5-year benefit cost rate applicable to any State for any taxable year is that percentage obtained by dividing (A) one-fifth of the total of the compensation paid under the State unemployment compensation law during the 5-year period ending at the close of the second calendar year preceding such taxable year, by (B) the total of the remuneration subject to contributions under the State unemployment compensation law with respect to the first calendar year preceding such taxable year. (6) Rounding. If any percentage referred to in either subparagraph (B) or (C) of subsection (c) (3) is not a multiple of .1 percent, it shall be rounded to the nearest multiple of .1 percent. (7) Determination and certification of percentages. The percentage referred to in subsection (c) (3) (B) or (C) for any taxable year for any State having a balance referred to therein shall be determined by the Secretary of Labor, and shall be certified by him to the Secretary of the Treasury before June 1 of such year, on the basis of a report furnished by such State to the Secretary of Labor before May 1 of such year. Any such State report shall be made as of the close of March 31 of the taxable year, and shall be made on such forms, and shall contain such information, as the Secretary of Labor deems necessary to the performance of his duties under this section. Subject to the limits provided by subsection (c), if (1) an employer acquires during any calendar year substantially all the property used in the trade or business of another person, or used in a separate unit of a trade or business of such other person, and immediately after the acquisition employs in his trade or business one or more individuals who immediately prior to the acquisition were employed in the trade or business of such other person, and (2) such other person is not an employer for the calendar year in which the acquisition takes place, then, for the calendar year in which the acquisition takes place, in addition to the credits allowed under subsections (a) and (b), such employer may credit against the tax imposed by section 3301 for such year an amount equal to the credits which (without regard to subsection (c)) would have been allowable to such other person under subsections (a) and (b) and this subsection for such year, if such other person had been an employer, with respect to remuneration subject to contributions under the unemployment compensation law of a State paid by such other person to the individual or individuals described in paragraph (1). (As amended Sept. 13, 1960, Pub. L. 86-778, title V, § 523(b), 74 Stat. 980; Mar. 24, 1961, Pub. L. 87-6, § 14(b), 75 Stat. 16; Sept. 26, 1961, Pub. L. 87-321, § 1(a), 75 Stat. 683; May 29, 1963, Pub. L. 88–31, § 2(b), 77 Stat. 51; Nov. 7, 1963, Pub. L. 88–173, § 1(a)—(c), 77 Stat. 305.) REFERENCES IN TEXT Title XII of the Social Security Act, referred to in subsec. (c), is classified to sections 1821-1823 of Title 42, The Public Health and Welfare. The date of the enactment of the Employment Security Act of 1960, referred to in subsec. (c), means the date of the enactment of title V of Pub. L. 86-778, which was approved on Sept. 18, 1960. Section 104 of the Temporary Unemployment Compensation Act of 1958, referred to in subsec. (d) (8), is classified to section 1400c of Title 42, The Public Health and Welfare. AMENDMENTS 1963 Subsec. (c). Pub. L. 88-173, in cl. (2), substituted "on January 1, 1963 (and in the case of any succeeding taxable year beginning before January 1, 1968)," for "with the fourth consecutive January ì", in subpar. (A), and "on or after January 1, 1968," for "with a consecutive January 1", in subpar. (B), and added paragraph following subpar. (B). Subsec. (d)(1). Pub. L. 88-31 substituted "the rate provided by such section" for "3.1 percent (or, in the case of the tax imposed with respect to the calendar years 1962 and 1963, in lieu of 3.5 percent)." 1961-Subsec. (d)(1). Pub. L. 87-6 provided for computation of the tax at the rate of 3 percent in lieu of 3.5 percent for calendar years 1962 and 1968. Subsec. (e). Pub. L. 87-321 added subsec. (e). 1960 Subsec. (c). Pub. L. 86-778 restricted cl. (2) to advances made before the date of the enactment of the Employment Security Act of 1960, added cl. (3), and eliminated provisions which related to the attributing of wages to a particular State, which provisions are now covered by subsec. (d) (2). Subsec. (d). Pub. L. 86-778 added subsec. (d). EFFECTIVE DATE OF 1963 AMENDMENT Section 1(d) of Pub. L. 88-173 provided that: "The amendments made by subsections (a), (b), and (c) of this section [to subsec. (c) (2) of this section] shall apply only with respect to taxable years beginning on or after January 1, 1963.” EFFECTIVE DATE OF 1961 AMENDMENT Section 1(b) of Pub. L. 87-321 provided that: "The amendment made by subsection (a) [adding subsec. (e) to this section] shall apply with respect to the calendar year 1961 and each calendar year thereafter." § 3304. Approval of State laws. UNEMPLOYMENT COMPENSATION LAW OF COMMONWEALTH OF PUERTO RICO Section 543(b) of Pub. L. 86-778, title V, Sept. 13, 1960, 74 Stat. 986, provided that: "The unemployment compensation law of the Commonwealth of Puerto Rico shall be considered as meeting the requirements of "(1) Section 3304 (a) (2) of the Federal Unemployment Tax Act [subsec. (a) (2) of this section), if such law provides that no compensation is payable with respect to any day of unemployment occurring before January 1, 1959. "(2) Section 3304(a)(3) of the Federal Unemployment Tax Act [subsec. (a) (3) of this section] and section 303 (a) (4) of the Social Security Act [section 503 (a) (4) of Title 42], if such law contains the provisions required by those sections and if it requires that, on or before February 1, 1961, there be paid over to the Secretary of the Treasury, for credit to the Puerto Rico account in the Unemployment Trust Fund, an amount equal to the excess of "(A) the aggregate of the moneys received in the Puerto Rico unemployment fund before January 1, 1961, over "(B) the aggregate of the moneys paid from such fund before January 1, 1961, as unemployment compensation or as refunds of contributions erroneously paid." § 3305. Applicability of State law. (b) Federal instrumentalities in general. The legislature of any State may require any instrumentality of the United States (other than an instrumentality to which section 3306(c) (6) applies), and the individuals in its employ, to make contributions to an unemployment fund under a State unemployment compensation law approved by the Secretary of Labor under section 3304 and (except as provided in section 5240 of the Revised Statutes, as amended (12 U.S.C., sec. 484), and as modified by subsection (c)), to comply otherwise with such law. The permission granted in this subsection shall apply (A) only to the extent that no discrimination is made against such instrumentality, so that if the rate of contribution is uniform upon all other persons subject to such law on account of having individuals in their employ, and upon all employees of such persons, respectively, the contributions required of such instrumentality or the individuals in its employ shall not be at a greater rate than is required of such other persons and such employees, and if the rates are determined separately for different persons or classes of persons having individuals in their employ or for different classes of employees, the determination shall be based solely upon unemployment experience and other factors bearing a direct relation to unemployment risk; (B) only if such State law makes provision for the refund of any contributions required under such law from an instrumentality of the United States or its employees for any year in the event such State is not certified by the Secretary of Labor under section 3304 with respect to such year; and (C) only if such State law makes provision for the payment of unemployment compensation to any employee of any such instrumentality of the United States in the same amount, on the same terms, and subject to the same conditions as unemployment compensation is payable to employees of other employers under the State unemployment compensatior law. (g) Vessels operated by general agents of United States. The permission granted by subsection (f) shall apply in the same manner and under the same conditions (including the obligation to comply with all requirements of State unemployment compensation laws) to general agents of the Secretary of Commerce with respect to service performed on or after July 1, 1953, by officers and members of the crew on or in connection with American vessels (1) owned by or bareboat chartered to the United States, and (2) whose business is conducted by such general agents. As to any such vessel, the State permitted to require contributions on account of such service shall be the State to which the general agent would make contributions if the vessel were operated for his own account. Such general agents are designated, for this purpose, instrumentalities of the United States neither wholly nor partially owned by it and shall not be exempt from the tax imposed by section 3301. The permission granted by this subsection is subject to the same conditions and limitation as are imposed in subsection (f), except that clause (B) of the second sentence of subsection (b) shall apply. (As amended Sept. 13, 1960, Pub. L. 86-778, title V, § 531 (a), (b), 74 Stat. 983.) AMENDMENTS 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 provision of law," and added cl. (C). Subsec. (g). Pub. L. 86–778, § 531(b), substituted "neither wholly nor partially" for "not wholly." EFFECTIVE DATE OF 1960 AMENDMENT Section 535 of Pub. L. 86-778 provided that: "The amendments made by this part [adding section 3308 of this title, amending subsecs. (b) and (g) of this section and sections 3306 (c), 3306(c) (4), (8), (10) and 3306(m) of this title] (other than the amendments made by subsections (e) and (f) of section 531 [to sections 1361(a) and 1367 of title 42]) shall apply with respect to remuneration paid after 1961 for services performed after 1961. The amendments made by subsections (e) and (f) of section 531 shall apply with respect to any week of unemployment which begins after December 31, 1960." APPLICABILITY TO FEDERAL LAND BANKS, FEDERAL INTERMEDIATE CREDIT BANKS, AND BANKS FOR COOPERATIVES Section 531 (g) of Pub. L. 86-778 provided that: "Notwithstanding section 203(b) of the Farm Credit Act of 1959 [set out as a note under section 6401 of title 12], sections 3305(b), 3306(c) (6), and 3308 of the Internal Revenue Code of 1954 [subsec. (b) of this section and sections 3306(c)(6) and 3308 of this title], and sections 1501 (a) and 1507(a) of the Social Security Act [sections 1361(a) and 1367 of title 42] shall be applicable, according to their terms, to the Federal land banks, Federal intermediate credit banks, and banks for cooperatives." § 3306. Definitions. (b) Wages. For purposes of this chapter, the term "wages" means all remuneration for employment, including the cash value of all remuneration paid in any medium other than cash; except that such term shall not include_ (5) any payment made to, or on behalf of, an employee or his beneficiary— (B) under or to an annuity plan which, at the time of such payment, is a plan described in section 403 (a), or (C) under or to a bond purchase plan which, at the time of such payment, is a qualified bond purchase plan described in section 405(a); (c) Employment. For purposes of this chapter, the term “employment" means any service performed prior to 1955, which was employment for purposes of subchapter C of chapter 9 of the Internal Revenue Code of 1939 under the law applicable to the period in which such service was performed, and any service, of whatever nature, performed after 1954 by an employee for the person employing him, irrespective of the citizenship or residence of either, (A) within the United States, or (B) 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 aircraft it touches at a port in the United States, if the employee is employed on and in connection with such vessel or aircraft when outside the United States, except (4) service performed on or in connection with a vessel or aircraft not an American vessel or American aircraft, if the employee is employed on and in connection with such vessel or aircraft when outside the United States: (6) service performed in the employ of the United States Government or of an instrumentality of the United States which is (A) wholly or partially owned by the United States, or (B) exempt from the tax imposed by section 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; (8) service 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); (10) (A) service performed in any calendar quarter in the employ of any organization exempt from income tax under section 501 (a) (other than an organization described in section 401(a)) or under section 521, if the remuneration 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 by a student who is enrolled and is regularly attending classes at such school, college, or university; (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, seaweeds, 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 (determined in the manner provided for determining the register tonnage of merchant vessels under the laws of the United States); or (18) Service which is performed by a nonresident alien individual for the period he is temporarily present in the United States as a nonimmigrant under subparagraph (F) or (J) of section 101 (a) (15) of the Immigration and Nationality Act, as amended, and which is performed to carry out the purpose specified in subparagraph (F) or (J), as the case may be. (j) State, United States, and citizen. For purposes of this chapter (1) State. The term "State" includes the District of Columbia and the Commonwealth of Puerto Rico. (2) United States. The term "United States" when used in a geographical sense includes the States, the District of Columbia, and the Commonwealth of Puerto Rico. An individual who is a citizen of the Commonwealth of Puerto Rico (but not otherwise a citizen of the United States) shall be considered for purposes of this section, as a citizen of the United States. (m) American vessel and aircraft. For purposes of this chapter, the term "American vessel" means any vessel documented or numbered under the laws of the United States; and includes any vessel which is neither documented 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 aircraft registered under the laws of the United States. (As amended June 25, 1959, Pub. L. 86–70, § 22(a), 73 Stat. 146; July 12, 1960, Pub. L. 86-624, § 18(d), 74 Stat. 417; Sept. 13, 1960, Pub. L. 86-778, title V, §§ 531 (c), 532—534, 543(a), 74 Stat. 983, 984, 986; Sept. 21, 1961, Pub. L. 87-256, § 110 (f), 75 Stat. 537; Oct. 10, 1962, Pub. L. 87-792, § 7(k), 76 Stat. 830.) REFERENCES IN TEXT Section 101(a)(15) of the Immigration and Nationality Act, as amended, referred to in subsec. (c) (18), is classified to section 1101 (a) (15) of Title 8, Aliens and Nationality. AMENDMENTS 1962 Subsec. (b) (5). Pub. L. 87-792 substituted "is a plan described in section 403 (a)" for "meets the requirements 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 subsec. (c) (18). 1960 Subsec. (c). Pub. L. 86-778, § 532(a), included employment on or in connection with an American aircraft 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 words "which specifically refers to such section (or the corresponding section of prior law) in granting such exemption" in cl. (B). Subsec. (c) (8). Pub. L. 86-778, § 533, substituted "service 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 perforced in the employ of a corporation, community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational 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 attempting, to influence legislation." Subsec. (c) (10). Pub. L. 86-778, § 534, eliminated provisions which excepted from the definition of the term "employment" service in connection with the collection of dues or premiums for a fraternal beneficiary society, order, or association which is performed away from the home office or is ritualistic service in connection with any such society, order, or association, service performed in the employ of an agricultural or horticultural organization 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 service performed in the employ of a school, college, or university, not exempt from income tax under section 501(a) of this title if such service is performed by a student who is enrolled and regularly attending classes. Subsec. (1). Pub. L. 86-778, § 543 (a), included the Commonwealth of Puerto Rico and eliminated the word "Hawaii" from the definition of "State", defined the term "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 considered for purposes of this section, as a citizen of the United States. Pub. L. 86-624 eliminated "Hawali, and" preceding "the District of Columbia." Subsec. (m). Pub. L. 86-778, § 532 (c), included aircraft in the catchline and defined the term "American aircraft." 1959 Subsec. (1). Pub. L. 86-70 eliminated "Alaska," preceding "Hawaii." EFFECTIVE DATE OF 1962 AMENDMENT Amendment of section 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 37 of this title. EFFECTIVE DATE OF 1961 AMENDMENT Amendment of section by Pub. L. 87-256 applicable with respect to service performed after Dec. 31, 1981, see section 110(h) (3) of Pub. L. 87-256, set out as a note under section 3121 of this title. EFFECTIVE DATE OF 1960 AMENDMENTS Amendment of subsecs. (c), (c) (4), (6), (8), (10), and (m) of this section by 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. Section 543 (a) of Pub. L. 86-778 provided in part that the amendment of subsec. (1) of this section by Pub. L. 86-778 shall be effective with respect to remuneration paid after Dec. 31, 1960, for services performed after such date. Amendment of subsec. (j) by Pub. L. 86-624 effective on August 21, 1959, see section 18(k) of Pub. L. 86-624, set out as a note under section 2202 of this title. EFFECTIVE DATE OF 1959 AMENDMENT Amendment of section by Pub. L. 86-70 effective Jan. 3, 1959, see section 22(1) of Pub. L. 86–70, set out as a note under section 2202 of this title. APPLICABILITY TO FEDERAL LAND BANKS, FEDERAL INTERMEDIATE CREDIT BANKS, AND BANKS FOR COOPERATIVES Applicability of subsec. (c) (6) of this section to Federal 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. § 3308. Instrumentalities of the United States. Notwithstanding any other provision of law (whether enacted before or after the enactment of this section) which grants to any instrumentality of the United States an exemption from taxation, such instrumentality shall not be exempt from the tax imposed by section 3301 unless such other provision of law grants a specific exemption, by reference to section 3301 (or the corresponding section of prior law), from the tax imposed by such section. (Added Pub. L. 86-778, title V, § 531(d) (1), Sept. 13, 1960, 74 Stat. 983.) REFERENCES IN TEXT Enacted before or after the enactment of this section, referred to in the text, means enacted before or after Sept. 13, 1960, the date of approval of Pub. L. 86-778. EFFECTIVE DATE Section 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. APPLICABILITY TO FEDERAL LAND BANKS, FEDERAL INTERMEDIATE CREDIT BANKS, AND BANKS FOR COOPERATIVES Applicability of this section to Federal 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. § 3309. Short title. Pub. L. 86-778, title V, § 531 (d) (1), Sept. 13, 1960, 74 Stat. 983, redesignated former section 3308 as 3309. Chapter 24.-COLLECTION OF INCOME TAX AT SOURCE ON WAGES § 3401. Definitions. (a) Wages. For purposes of this chapter, the term "wages" means all remuneration (other than fees paid to a public official) for services performed by an employee for his employer, including the cash value of all remuneration paid in any medium other than cash; except that such term shall not include remuneration paid (6) for services performed by a nonresident alien individual, other than (C) an individual who is temporarily present in the United States as a nonimmigrant under subparagraph (F) or (J) of section 101(a) (15) of the Immigration and Nationality Act, as amended, if such remuneration is exempt, under section 1441 (c) (4) (B), from deduction and withholding under section 1441(a), and is not exempt from taxation under section 872(b) (3), or (12) 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 section 501 (a) at the time of such payment unless such payment is made to an employee of the trust as remuneration for services rendered as such employee and not as a beneficiary of the trust; or (B) under or to an annuity plan which, at the time of such payment, is a plan described in section 403 (a); or (C) under or to a bond purchase plan which, at the time of such payment, is a qualified bond purchase plan described in section 405(a). (13) pursuant to any provision of law other than section 5(c) or 6(1) of the Peace Corps Act, for service performed as a volunteer or volunteer leader within the meaning of such Act. (As amended Sept. 21, 1961, Pub. L. 87-256, § 110 (g) (1), 75 Stat. 537; Sept. 22, 1961, Pub. L. 87-293, title II, § 201(c), 75 Stat. 625; Oct. 10, 1962, Pub. L. 87-792, § 7(1), 76 Stat. 830.) REFERENCES IN TEXT Section 101 (a) (15) of the Immigration and Nationality Act, as amended, referred to in subsec. (a) (6) (C), is classified to section 1101(a)(15) of Title 8, Aliens and Nationality. Sections 5(c) and 6(1) of the Peace Corps Act, referred to in subsec. (a) (13), are sections 5(c) and 6(1) of Pub. L. 87-293, which are classified to sections 2504(c) and 2505 (1) of Title 22, Foreign Relations and Intercourse, respectively. Such Act, referred to in subsec. (a) (13), refers to the Peace Corps Act, which is classified to chapter 34 of Title 22, Foreign Relations and Intercourse. AMENDMENTS 1962 Subsec. (a)(12). Pub. L. 87-792 substituted "is a plan described in section 403 (a)" for "meets the requirements of section 401(a) (3), (4), (5), and (6)", in subpar. (B), and added subpar. (C). 1961-Subsec. (a) (6). Pub. L. 87-256 added subpar. (C). Subsec. (a) (13). Pub. L. 87-293 added subsec. (a) (13). EFFECTIVE DATE OF 1962 AMENDMENT Amendment of section 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 37 of this title. EFFECTIVE DATE OF 1961 AMENDMENTS Amendment of this section by Pub. L. 87-293 applicable with respect to remuneration paid after Sept. 22, 1961, see section 201(d) of Pub. L. 87-293, set out as a note under section 912 of this title. Section 110(h) (4) of Pub. L. 87-256 provided that: "The amendments made by subsection (g) of this section [to this section and section 3402 of this title] shall apply with respect to wages paid after December 31, 1961.". § 3402. Income tax collected at source. AMENDMENTS 1961-Subsec. (f) (6). Pub. L. 87-256 added subsec. (1) (6). EFFECTIVE DATE OF 1961 AMENDMENT Amendment of section by Pub. L. 87-256 applicable with respect to wages paid after Dec. 31, 1961, see section 110(h) (4) of Pub. L. 87-256, set out as a note under section 3401 of this title. Subtitle D.-Miscellaneous Excise Taxes Chapter 31.-RETAILERS EXCISE TAXES Subchapter A.-Jewelry and Related Items § 4001. Imposition of tax. There is hereby imposed upon the following articles sold at retail a tax equivalent to 10 percent of the price for which so sold: All articles commonly or commercially known as jewelry, whether real or imitation. The following stones, by whatever name called, whether real or synthetic: Amber. Beryl of the following types: Aquamarine. Emerald. Golden Beryl. Heliodor. Morganite. Chrysoberyl of the following types: Alexandrite. Cat's eye. Chrysolite. Corundum of the following types: Diamond. Feldspar of the following type: Moonstone. Garnet. Jadeite (Jade). Jet. Lapis Lazuli. Nephrite (Jade). Opal. Pearls (natural and cultured). Quartz of the following types: Citrine. Moss agate. Sardonyx. Spinel. Topaz. Tourmaline. Turquoise. Zircon. Articles made of, or ornamented, mounted or Cases and movements for watches and clocks. Gold, gold-plated, silver, or sterling flatware or hollow ware and silver-plated hollow ware. |