I
107TH CONGRESS
1ST SESSION
H. R. 1079
To amend the Internal Revenue Code of 1986 to change certain threshold
and other tests in order to decrease the amount of farm labor wages
that are subject to Social Security and Medicare taxes, and for other
purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 15, 2001
Mr. LEWIS of Kentucky (for himself and Mr. SCHAFFER) 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 change
certain threshold and other tests in order to decrease
the amount of farm labor wages that are subject to
Social Security and Medicare taxes, and for other pur-
poses.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. CHANGES IN THRESHOLD AND OTHER TESTS
FOR DETERMINING AMOUNT OF WAGES PAID
TO AGRICULTURAL WORKERS THAT ARE SUB-
JECT TO SOCIAL SECURITY AND MEDICARE
TAXES.
(a) INCREASE IN $150 REMUNERATION THRESHOLD
TO $1,000 AND INCREASE IN TOTAL FARM PAYROLL
TEST.—
(1) INTERNAL REVENUE CODE OF 1986.—Sub-
paragraph (B) of section 3121(a)(8) of the Internal
Revenue Code of 1986 (relating to definition of
wages) is amended—
(A) in clause (i), by striking ‘‘$150’’ and
inserting ‘‘$1,000’’; and
(B) in clause (ii), by striking ‘‘$2500’’ and
inserting ‘‘$50,000’’.
(2) SOCIAL SECURITY ACT.—Subparagraph (B)
of section 209(a)(7) of the Social Security Act (42
U.S.C. 409(a)(7)(B)) (relating to definition of
wages) is amended—
(A) in clause (i), by striking ‘‘$150’’ and
inserting ‘‘$1,000’’; and
(B) in clause (ii), by striking ‘‘$2500’’ and
inserting ‘‘$50,000’’.
(b) ADJUSTMENT FOR INFLATION.—
(1) INTERNAL REVENUE CODE OF 1986.—Sub-
section (i) of section 3121 of the Internal Revenue
Code of 1986 (relating to computation of wages in
certain cases) is amended by adding at the end the
following new paragraph:
‘‘(6) AGRICULTURAL LABOR.—
‘‘(A) IN GENERAL.—For purposes of this
chapter, in the case of agricultural labor re-
ferred to in subsection (a)(8), in the case of a
calendar year after 2001, the $1,000 amount
contained in subparagraph (B)(i), and the
$50,000 amount contained in subparagraph
(B)(ii), shall each be increased by an amount
equal to—
‘‘(i) such dollar amount, multiplied by
‘‘(ii) the cost-of-living adjustment de-
termined under section 1(f)(3) for the cal-
endar year in which the taxable year be-
gins by substituting ‘calendar year 2000’
for ‘calendar year 1992’ in subparagraph
(B) thereof.
‘‘(B) ROUNDING.—If any increase deter-
mined under subparagraph (A) is not a multiple
of $50, such increase shall be rounded to the
next lowest multiple of $50.’’.
(2) SOCIAL SECURITY ACT.—Section 209 of the
Social Security Act (42 U.S.C. 409) is amended by
adding at the end the following new subsection:
‘‘(l)(1) For purposes of this title, in the case of agri-
cultural labor referred to in subsection (a)(7), in the case
of a calendar year after 2001, the $1,000 amount con-
tained in subparagraph (B)(i), and the $50,000 amount
contained in subparagraph (B)(ii), shall each be increased
in the same manner as the $1,000 amount and the
$50,000 amount, respectively, contained in section
3121(a)(8)(B) of the Internal Revenue Code of 1986 are
increased pursuant to section 3121(i)(6) of such Code.’’.
(c) EXEMPTION FOR SERVICE PERFORMED BY CER-
TAIN FULL TIME STUDENTS.—
(1) INTERNAL REVENUE CODE OF 1986.—Sec-
tion 3121(b) of the Internal Revenue Code of 1986
(relating to definition of employment) is amended by
striking ‘‘or’’ at the end of paragraph (20), by strik-
ing the period at the end of paragraph (21) and in-
serting ‘‘; or’’, and by adding at the end the fol-
lowing new paragraph:
‘‘(22) agricultural labor performed by a full
time student who has not attained 18 years of age.’’.
(2) SOCIAL SECURITY ACT.—Section 210(a) of
the Social Security Act (42 U.S.C. 410(a)) is
amended—
(A) by striking ‘‘or’’ at the end of para-
graph (20),
(B) by striking the period at the end of
paragraph (21) and inserting ‘‘; or’’, and
(C) by inserting after paragraph (21) the
following new paragraph:
‘‘(22) Agricultural labor performed by a full
time student who has not attained 18 years of age.’’.
(d) EFFECTIVE DATE.—The amendments made by
this section shall apply to remuneration paid after Decem-
ber 31, 2001.
SEC. 2. COORDINATION OF COLLECTION OF AGRICUL-
TURAL LABOR EMPLOYMENT TAXES WITH
COLLECTION OF INCOME TAXES.
(a) IN GENERAL.—Subsection (c) of section 3510 of
the Internal Revenue Code of 1986 (relating to coordina-
tion of collection of domestic service employment taxes
with collection of income taxes) is amended to read as fol-
lows:
‘‘(c) ELIGIBLE EMPLOYMENT TAXES.—
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, the term ‘eligible employment taxes’ means—
‘‘(A) domestic service employment taxes,
and
‘‘(B) agricultural labor employment taxes.
‘‘(2) 
DOMESTIC
SERVICE
EMPLOYMENT
TAXES.—For purposes of paragraph (1), the term
‘domestic service employment taxes’ means—
‘‘(A) any taxes imposed by chapter 21 or
23 on remuneration paid for domestic service in
a private home of the employer, and
‘‘(B) any amount withheld from such re-
muneration pursuant to an agreement under
section 3402(p).
For purposes of this paragraph, the term ‘domestic
service in a private home of the employer’ includes
domestic service described in section 3121(g)(5).
‘‘(3) 
AGRICULTURAL
LABOR
EMPLOYMENT
TAXES.—For purposes of paragraph (1), the term
‘agricultural labor employment taxes’ means—
‘‘(A) any taxes imposed by chapter 21 or
23 on remuneration paid for agricultural labor,
and
‘‘(B) any amount withheld from such re-
muneration pursuant to an agreement under
section 3402(p).
For purposes of this paragraph, the term ‘agricul-
tural labor’ has the meaning provided in section
3121(g).’’.
(b) CONFORMING AMENDMENTS.—
(1) The heading of section 3510 of such Code
is amended by inserting ‘‘AND AGRICUL-
TURAL LABOR’’ after ‘‘DOMESTIC SERV-
ICE’’.
(2) Subsections (a)(1), (b)(1), (e), and (f)(1) of
such section are each amended by striking ‘‘domestic
service employment taxes’’ and inserting ‘‘eligible
employment taxes’’.
(3) The heading of subsection (b) of such sec-
tion is amended by striking ‘‘DOMESTIC SERVICE’’
and inserting ‘‘ELIGIBLE’’.
(4) Subsection (d) and the first sentence of sub-
section (f)(1) of such section are each amended by
inserting before the period at the end the following:
‘‘or for agricultural labor’’.
(5) Subsection (e) of such section is amended
by inserting before the period at the end the fol-
lowing: ‘‘and agricultural labor employers’ income
taxes’’.