Social Security Domestic Employment Tax Simplification Act of 1993

Summary: Social Security Domestic Employment Tax Simplification Act of 1993 - Amends title II (Old Age, Survivors and Disability Insurance) of the Social Security Act and the Internal Revenue Code (IRC) to raise the threshold amount of cash remuneration payable to a domestic employee in any year which is subject to social security employment taxes. 
Amends IRC to:  (1) provide for the coordination of the collection of domestic service employment taxes with the collection of income taxes; (2) subject domestic service employment taxes to estimated tax provisions; (3) exempt certain employers from the payment of such taxes; and (4) authorize the Secretary of the Treasury to enter into agreements to collect State unemployment taxes imposed on such remuneration. 
Requires the Secretaries of Health and Human Services and the Treasury to study and report to the Congress on the effects of this Act.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Social Security Domestic Employment 
Tax Simplification Act of 1993''.

SEC. 2. INCREASE IN MINIMUM AMOUNT OF CASH REMUNERATION FOR DOMESTIC 
              SERVICES SUBJECT TO SOCIAL SECURITY EMPLOYMENT TAXES.

    (a) Determination of Wages under the Social Security Act.--
Subparagraph (B) of section 209(a)(6) of the Social Security Act is 
amended to read as follows:
            ``(B)(i) Cash remuneration paid by an employer in any 
        calendar year to an employee for domestic service in a private 
        home of the employer, if the cash remuneration paid in such 
        year by the employer to the employee for such service is less 
        than the minimum assessed wages determined under this 
        subparagraph for such year.
            ``(ii) The minimum assessed wages for 1993 shall be the 
        product of $200 and the ratio of the average of the total wages 
        (as defined in regulations of the Secretary and computed 
        without regard to the limitations specified in section 
        209(a)(1)) for 1992 to the average of the total wages (as so 
        defined) for 1950, with such product, if not a multiple of $10, 
        being rounded to the next higher multiple of $10 where such 
        amount is a multiple of $5 but not of $10 and to the nearest 
        multiple of $10 in any other case.
            ``(iii) The Secretary shall, on or after November 1 of 1993 
        and of every year thereafter, determine and publish in the 
        Federal Register the minimum assessed wages for the succeeding 
        calendar year. The amount of such minimum assessed wages shall 
        be the larger of--
                    ``(I) the amount in effect for the calendar year in 
                which the determination under this clause is made, or
                    ``(II) the product of the minimum assessed wages 
                for 1993 and the ratio of the deemed average total 
                wages (as defined in section 209(k)(1)) for the 
                calendar year before the year in which the 
                determination under this clause is made to the deemed 
                average total wages (as so defined) for 1991,
        with such product, if not a multiple of $10, being rounded to 
        the next higher multiple of $10 where such amount is a multiple 
        of $5 but not of $10 and to the nearest multiple of $10 in any 
        other case.
            ``(iv) As used in this subparagraph, the term `domestic 
        service in a private home of the employer' does not include 
        service described in section 210(f)(5).''.
    (b) Determination of Wages Under the Internal Revenue Code of 
1986.--
            (1) In general.--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, if the cash remuneration 
                paid in such year by the employer to the employee for 
                such service is less than the minimum assessed wages 
                determined under section 209(a)(6)(B) of the Social 
                Security Act for such year. As used in this 
                subparagraph, the term `domestic service in a private 
                home of the employer' does not include service 
                described in subsection (g)(5);''.
            (2) Conforming amendment.--The second sentence of section 
        3102(a) of such Code (relating to deduction of tax from wages) 
        is amended--
                    (A) by striking ``calendar quarter'' each place it 
                appears and inserting ``calendar year'', and
                    (B) by striking ``$50'' and inserting ``the minimum 
                assessed wages determined under section 209(a)(6)(B) of 
                the Social Security Act for such year''.
    (c) Effective Date.--The amendments made by this section shall 
apply to remuneration paid in calendar years after 1992. As soon as 
practicable after the date of the enactment of this Act, the Secretary 
of Health and Human Services shall publish in the Federal Register the 
minimum assessed wages for 1993, determined under section 
209(a)(6)(B)(ii) of the Social Security Act (as amended by this Act).

SEC. 3. COORDINATION OF COLLECTION OF DOMESTIC SERVICE EMPLOYMENT WITH 
              COLLECTION OF INCOME TAXES.

    (a) 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 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 due date (including extensions) of the income 
        tax return for 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) 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).
            ``(3) Transitional rule.--For purposes of applying section 
        6654 to a taxable year beginning in 1993, 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 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' does not include 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) 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).''
    (b) Clerical Amendment.--The table of sections for chapter 25 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.''
    (c) Effective Date.--The amendments made by this section shall 
apply to remuneration paid in calendar years after 1992.

SEC. 4. STUDY REGARDING MINIMUM ASSESSED WAGES FOR DOMESTIC SERVICE.

    (a) In General.--The Secretary of Health and Human Services and the 
Secretary of the Treasury shall conduct a joint study of the effects of 
the amendments made by this Act. In the course of such study, the 
Secretaries shall--
            (1) analyze the effect of the amounts of minimum assessed 
        wages established pursuant to such amendments on the integrity 
        of the Federal Old-Age and Survivors Insurance Trust Fund, the 
        Federal Disability Insurance Trust Fund, and the Federal 
        Hospital Insurance Trust Fund,
            (2) evaluate the annual savings to the Government caused by 
        the annualization of the employment taxes provided in such 
        amendments, and
            (3) such other related matters as they consider 
        appropriate.
    (b) Report.--Not later than January 1, 1996, the Secretaries shall 
transmit a report to the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate setting 
forth the results of their study conducted pursuant to subsection (a). 
Such study shall include such recommendations for legislative changes 
as such Secretaries may consider appropriate.