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[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 1470 Introduced in Senate (IS)]

105th CONGRESS
  1st Session
                                S. 1470

  To amend the Internal Revenue Code of 1986 to clarify that certain 
         school bus contractors and drivers are not employees.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                            November 8, 1997

 Ms. Mikulski introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
  To amend the Internal Revenue Code of 1986 to clarify that certain 
         school bus contractors and drivers are not employees.

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

SECTION 1. TREATMENT OF CERTAIN SCHOOL BUS CONTRACTORS AND DRIVERS.

    (a) In General.--Chapter 25 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new section:

``SEC. 3511. TREATMENT OF CERTAIN SCHOOL BUS CONTRACTORS AND DRIVERS.

    ``(a) In General.--For purposes of this title, in the case of 
services performed as a qualified school bus contractor or as a 
qualified driver--
            ``(1) the qualified school bus contractor shall not be 
        treated as an employee,
            ``(2) the person for whom services as a qualified bus 
        contractor are performed shall not be treated as an employer, 
        and
            ``(3) the qualified driver shall not be treated as an 
        employee of any person (except that this paragraph shall not 
        prevent such qualified driver from being treated as an employee 
        of the qualified school bus contractor).
    ``(b) Definitions.--For purposes of this section--
            ``(1) Qualified school bus contractor.--The term `qualified 
        school bus contractor' means any individual who--
                    ``(A) owns 1 or more school buses,
                    ``(B) enters into a written agreement with a public 
                school board or district, or comparable entity, to 
                provide school bus transportation services with respect 
                to a public school using the bus or buses owned by such 
                contractor, and
                    ``(C) is not personally required to drive a bus as 
                part of such transportation service (but is permitted 
                to do so if qualified under applicable State and local 
                law to do so).
            ``(2) Qualified driver.--The term `qualified driver' means 
        any individual who--
                    ``(A) is qualified under applicable State and local 
                requirements to drive a public school bus, and
                    ``(B) is directly engaged by a qualified school bus 
                contractor to provide school bus transportation 
                services described in paragraph (1)(B).
            ``(3) Public school.--The term `public school' does not 
        include any school above the secondary school level.
    ``(c) Coordination With Retirement Plans for Self-Employed.--This 
section shall not apply for purposes of subtitle A to the extent that 
the individual is treated as an employee under section 401(c)(1) 
(relating to self-employed individuals).''
    (b) Clerical Amendment.--The table of sections for chapter 25 of 
such Code is amended by adding at the end the following new item:

                              ``Sec. 3511. Treatment of certain school 
                                        bus contractors and drivers.''
    (c) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to services performed by individuals after December 31, 
        1991, as qualified school bus contractors and qualified drivers 
        (as defined in section 3511 of such Code, as added by this 
        section).
            (2) Special rule.--If refund or credit of any overpayment 
        of tax resulting from the application of subsection (a) is 
        prevented at any time before the close of the 1-year period 
        beginning on the date of the enactment of this Act by the 
        operation of any law or rule of law (including res judicata or 
        any closing agreement between the Internal Revenue Service and 
        any taxpayer), refund or credit of such overpayment (to the 
        extent attributable to the application of subsection (a)) may, 
        nevertheless, be made or allowed if claim therefor is filed 
        before the close of such 1-year period.
                                 <all>
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