I 

110TH CONGRESS 

1ST SESSION H. R. 2238 

To amend the Internal Revenue Code of 1986 to provide for residents of 

Puerto Rico who participate in cafeteria plans under the Puerto Rican 

tax laws an exclusion from employment taxes which is comparable to 

the exclusion that applies to cafeteria plans under such Code. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 9, 2007 

Mr. BECERRA (for himself, Mr. WELLER of Illinois, Mr. CROWLEY, and Mr. 

FORTUN ̃O) introduced the following bill; which was referred to the Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to provide 

for residents of Puerto Rico who participate in cafeteria 

plans under the Puerto Rican tax laws an exclusion 

from employment taxes which is comparable to the exclusion that applies to cafeteria plans under such Code. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. EXCLUSION FROM EMPLOYMENT TAXES FOR 

2 RESIDENTS OF PUERTO RICO FOR PAYMENTS 

3 MADE UNDER A CAFETERIA PLAN WHICH 

4 ARE EXCLUDABLE FROM THE PUERTO RICAN 

5 INCOME TAX. 

6 (a) SOCIAL SECURITY TAXES.— 

7 (1) IN GENERAL.—Paragraph (5) of section 

8 3121(a) of the Internal Revenue Code of 1986 (de9 fining wages) is amended by striking ‘‘or’’ at the end 

10 of subparagraph (H), by striking the semicolon at 

11 the end of subparagraph (I) and inserting ‘‘, or’’, 

12 and by inserting after subparagraph (I) the fol13 lowing new subparagraph: 

14 ‘‘(J) under a plan established under sec15 tion 1022(l) of the Puerto Rico Internal Rev16 enue Code of 1994 if such payment would not 

17 be treated as wages without regard to such plan 

18 and it would be reasonable to believe that (if 

19 such section 1022(l) applied for purposes of 

20 this section) such section 1022(l) would not 

21 treat any wages as constructively received;’’. 

22 (2) SOCIAL SECURITY ACT.—Paragraph (4) of 

23 section 209(a) of the Social Security Act (defining 

24 wages) is amended by adding at the end the fol25 lowing: ‘‘or (L) under a plan established under sec26 tion 1022(l) of the Puerto Rico Internal Revenue 


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1 Code of 1994 if such payment would not be treated 

2 as wages without regard to such plan and it would 

3 be reasonable to believe that (if such section 1022(l) 

4 applied for purposes of this section) such section 

5 1022(l) would not treat any wages as constructively 

6 received;’’. 

7 (b) UNEMPLOYMENT INSURANCE.—Paragraph (5) of 

8 section 3306(b) of such Code (defining wages) is amended 

9 by striking ‘‘or’’ at the end of subparagraph (G), by add10 ing ‘‘or’’ at the end of subparagraph (H), and by inserting 

11 after subparagraph (H) the following new subparagraph: 

12 ‘‘(I) under a plan established under section 

13 1022(l) of the Puerto Rico Internal Revenue 

14 Code of 1994 if such payment would not be 

15 treated as wages without regard to such plan 

16 and it would be reasonable to believe that (if 

17 such section 1022(l) applied for purposes of 

18 this section) such section 1022(l) would not 

19 treat any wages as constructively received;’’. 

20 (c) EFFECTIVE DATE.—The amendments made by 

21 this section shall apply to remuneration paid after the date 

22 of the enactment of this Act. 

Æ 


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