Tier 1 tax
In addition to other taxes, there is hereby imposed on the income of each employee a tax equal to the applicable percentage of the compensation received during any calendar year by such employee for services rendered by such employee. For purposes of the preceding sentence, the term “applicable percentage” means the percentage equal to the sum of the rates of tax in effect under subsections (a) and (b) of section 3101 for the calendar year.
Tier 2 tax
In addition to other taxes, there is hereby imposed on the income of each employee a tax equal to the percentage determined under section 3241 for any calendar year of the compensation received during such calendar year by such employee for services rendered by such employee.
Cross reference
For application of different contribution bases with respect to the taxes imposed by subsections (a) and (b), see section 3231(e)(2).
Aug. 16, 1954, ch. 73668A Stat. 431Aug. 31, 1954, ch. 116468 Stat. 1040Pub. L. 86–2873 Stat. 28Pub. L. 88–133, title II, § 20177 Stat. 221Pub. L. 89–97, title I79 Stat. 335Pub. L. 89–21279 Stat. 861Pub. L. 89–699, title III, § 301(a)80 Stat. 1078Pub. L. 89–700, title III, § 301(v)80 Stat. 1088Pub. L. 93–69, title I, § 102(a)87 Stat. 162Pub. L. 94–93, title II, § 20189 Stat. 466Pub. L. 94–455, title XIX, § 1903(a)(6)90 Stat. 1807Pub. L. 97–34, title VII, § 741(a)95 Stat. 347Pub. L. 98–76, title II97 Stat. 419Pub. L. 100–203, title IX, § 9031(a)101 Stat. 1330–296Pub. L. 101–508, title V, § 5125(a)104 Stat. 1388–285Pub. L. 107–90, title II, § 204(c)115 Stat. 892Pub. L. 113–295, div. A, title II, § 221(a)(100)(A)128 Stat. 4052(, ; , pt. II, § 206(a), ; , pt. II, § 201(a), , ; , , ; , §§ 105(b)(1), 111(c)(1), , , 342; , §§ 4, 5(a), , ; , , ; , (vi), , , 1089; , , ; , , ; , , ; , , ; , §§ 211(a), 221, , , 420; , , ; , , ; , , ; , , .)
Editorial Notes
Amendments
Pub. L. 113–2952014—Subsec. (b). amended subsec. (b) generally. Prior to amendment, subsec. (b) consisted of pars. (1) and (2) establishing the tier 2 tax and its applicable percentage.
Pub. L. 107–902001—Subsec. (b). amended heading and text of subsec. (b) generally. Prior to amendment, text read as follows: “In addition to other taxes, there is hereby imposed on the income of each employee a tax equal to 4.90 percent of the compensation received during any calendar year by such employee for services rendered by such employee.”
Pub. L. 101–5081990—Subsec. (a). substituted “applicable” for “following” before “percentage of the” and provision defining the term “applicable percentage” for provision specifying that in the case of compensation received during 1985 the rate of tax was 7.05 percent, for 1986 or 1987 the rate was 7.15 percent, for 1988 or 1989 the rate was 7.51 percent, and 1990 or thereafter the rate was 7.65 percent.
Pub. L. 100–2031987—Subsec. (b). amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “In addition to other taxes, there is hereby imposed on the income of each employee a tax equal to the following percentage of the compensation received during any calendar year by such employee for services rendered by such employee:
“In the case of compensation received during: | The rate shall be: |
|---|---|
1985 | 3.50 |
1986 or thereafter | 4.25.” |
Pub. L. 98–76, § 221section 3231 of this title1983—, amended section generally, substituting a two tiered tax system with accompanying tax rate tables and a cross reference to , for provisions which had taxed an employee at 2.75 percent of so much of the compensation paid in any calendar month to such employee for services rendered by him as was not in excess of an amount equal to one-twelfth of the current maximum annual taxable “wages” as defined in section 3121 for any month and which had provided that the rate of tax imposed by subsection (a) be increased by the rate of the tax imposed with respect to wages by section 3101(a) plus the rate imposed by section 3101(b) of so much of the compensation paid in any calendar month to such employee for services rendered by him as was not in excess of an amount equal to one-twelfth of the current maximum annual taxable “wages” as defined in section 3121 for any month.
Pub. L. 98–76, § 211(a), substituted “2.75 percent” for “2.0 percent”.
Pub. L. 97–341981—Subsec. (a). added subsec. (a).
Pub. L. 97–34Subsec. (b). designated existing provisions as subsec. (b) and substituted “The rate of tax imposed by subsection (a) shall be increased by” for “In addition to other taxes, there is hereby imposed on the income of every employee a tax rate equal to”.
Pub. L. 94–4551976— struck out “of the Internal Revenue Code of 1954” after “wages by section 3101(a)”, “of such Code” after “rate imposed by section 3101(b)”, “after ,” after “for services rendered by him”, “of the Internal Revenue Code of 1954” after “as defined in section 3121”, and “after ” after “for any month”.
Pub. L. 94–931975— inserted “in any calendar month” after “compensation paid”.
Pub. L. 93–69Provided1973— substituted new tax rate provisions on income of employee for services rendered after , for former provisions which prescribed 6¼, 6½, 7, 7¼, and 7½ percent on income for services rendered after , , , , and , respectively, as is not in excess of (i) $450, or (ii) an amount equal to one-twelfth of the current maximum annual taxable “wages” as defined in section 3121 of the Internal Revenue Code of 1954, whichever is greater, for any month after : , That the rate of tax imposed by this section shall be increased, with respect to compensation paid for services rendered after , by a number of percentage points (including fractional points) equal at any given time to the number of percentage points (including fractional points) by which the rate of the tax imposed with respect to wages by section 3101(a) plus the rate imposed by section 3101(b) at such time exceeds 2¾ percent (the rate provided by paragraph (2) of section 3101 as amended by the Social Security Amendments of 1956).
Pub. L. 89–7001966— substituted “rendered after ” for “rendered after ”, and “(i) $450, or (ii) an amount equal to one-twelfth of the current maximum annual taxable ‘wages’ as defined in section 3121 of the Internal Revenue Code of 1954, whichever is greater, for any month after ” for “$400 for any calendar month before the calendar month next following the month in which this provision was amended in 1963, or $450 for any calendar month after the month in which this provision was so amended and before the calendar month next following the calendar month in which this provision was amended in 1965, or (i) $450, or (ii) an amount equal to one-twelfth of the current maximum annual taxable ‘wages’ as defined in section 3121 of the Internal Revenue Code of 1954, whichever is greater, for any month after the month in which this provision was so amended”.
Pub. L. 89–699 substituted “7 percent” for “6¾ percent” in subd. (3), “7¼ percent” for “7 percent” in subd. (4), and “7½ percent” for “7¼ percent” in subd. (5).
Pub. L. 89–2121965— substituted pars. (1) to (5) for former pars. (1) and (2) which imposed a tax equal to 6¾ percent of so much of the compensation paid to such employee for services rendered by him after the month in which this provision was amended in 1959, and before , and 7¼ percent of so much of the compensation paid to such employee for services rendered by him after , and inserted “and before the calendar month next following the calendar month in which this provision was amended in 1965, or (i) $450, or (ii) an amount equal to one-twelfth of the current maximum annual taxable ‘wages’ as defined in section 3121 of the Internal Revenue Code of 1954, whichever is greater, for any month after the month in which this provision was so amended”.
Pub. L. 89–97 substituted “the rate of the tax imposed with respect to wages by section 3101(a) at such time exceeds 2¾ percent (the rate provided by paragraph (2) of section 3101 as amended by the Social Security Amendments of 1956)” for “the rate of the tax imposed with respect to wages by section 3101 at such time exceeds the rate provided by paragraph (2) of such section 3101 as amended by the Social Security Amendments of 1956” and inserted “plus the rate imposed by section 3101(b)” after “section 3101(a)”, respectively.
Pub. L. 88–1331963— limited existing taxable compensation base of $400 to any calendar month before Nov. 1963 and increased such base to $450 for any calendar month after Oct. 1963.
Pub. L. 86–28section 3101 of this title1959— increased tax from 6¼ percent of compensation not in excess of $350 for any calendar month to 6¾ percent of the compensation not in excess of $400 for any calendar month for services rendered before , and to 7¼ percent for services rendered after , and required an increase in the rate of tax with respect to compensation paid for services rendered after , by a number of percentage points equal at any given time to the number of percentage points by which the rate of tax imposed by at such time exceeds the rate provided by par. (2) of such section 3101 as amended by the Social Security Amendments of 1956.
1954—Act , substituted “$350” for “$300”.
Statutory Notes and Related Subsidiaries
Effective Date of 2014 Amendment
Pub. L. 113–295section 221(b) of Pub. L. 113–295section 1 of this titleAmendment by effective , subject to a savings provision, see , set out as a note under .
Effective Date of 2001 Amendment
Pub. L. 107–90section 204(f) of Pub. L. 107–90section 24 of this titleAmendment by applicable to calendar years beginning after , see , set out as a note under .
Effective Date of 1987 Amendment
Pub. L. 100–203, title IX, § 9031(b)101 Stat. 1330–296
Effective and Termination Dates of 1983 Amendment
Pub. L. 98–76, title II, § 21297 Stat. 419
Pub. L. 98–76, title II, § 227(a)97 Stat. 426
Effective Date of 1981 Amendment
Pub. L. 97–34, title VII, § 741(e)95 Stat. 347
Effective Date of 1976 Amendment
Pub. L. 94–455section 1903(d) of Pub. L. 94–455section 3101 of this titleAmendment by applicable with respect to compensation paid for services rendered after , see , set out as a note under .
Effective Date of 1975 Amendment
Pub. L. 94–93, title II, § 20789 Stat. 467
Effective Date of 1973 Amendment
Pub. L. 93–69, title I, § 109(b)87 Stat. 165
Effective Date of 1965 Amendments
Pub. L. 89–212, § 679 Stat. 862
Pub. L. 89–97, title I, § 105(b)(4)79 Stat. 336
section 111(c)(1) of Pub. L. 89–97section 111(e) of Pub. L. 89–97section 1395i–1 of Title 42Amendment by applicable to calendar year 1966, or to any subsequent calendar year but only if by October 1 immediately preceding such calendar year the Railroad Retirement Tax Act [this chapter] provides for a maximum amount of monthly compensation taxable under such Act during all months of such calendar year equal to one-twelfth of maximum wages which Federal Insurance Contributions Act [section 3101 et seq. of this title] provides may be counted for such calendar year, see , set out as an Effective Date note under , The Public Health and Welfare.
Effective Date of 1959 Amendment
Pub. L. 86–28, title II, § 20273 Stat. 30
Effective Date of 1954 Amendment
Act Aug. 31, 1954, ch. 116468 Stat. 1042Pub. L. 99–514, § 2100 Stat. 2095
Separability
Pub. L. 93–69, title III, § 30187 Stat. 168
Pub. L. 97–123Penalties and Interest Not Assessed for Failure To Make Timely Payment During Period , to , of Taxes Attributable to Amendments by
section 3 of Pub. L. 97–123section 3(f) of Pub. L. 97–123section 3101 of this titleFor provision that no penalties or interest shall be assessed on account of any failure to make timely payment of taxes imposed by subsec. (b) of this section with respect to payments made for the period , and ending , to the extent that such taxes are attributable to or the amendments made by that section, see , set out as a note under .