COLLECTION OF EMPLOYEE SOCIAL SECURITY AND RAILROAD RETIREMENT TAXES ON TAXABLE GROUP-TERM LIFE INSURANCE PROVIDED TO RETIREES.

SEC. 5124. COLLECTION OF EMPLOYEE SOCIAL SECURITY AND RAILROAD RETIREMENT TAXES ON TAXABLE GROUP-TERM LIFE INSURANCE PROVIDED TO RETIREES. (a) Social Security Taxes.—Section 3102 of the Internal Revenue Code of 1986 (relating to deduction of tax from wages) is amended by adding at the end thereof the following new subsection: “(d) Special Rule for Certain Taxable Group-Term Life Insurance Benefits.— “(1) In general.—In the case of any payment for group-term life insurance to which this subsection applies— “(A) subsection (a) shall not apply, “(B) the employer shall separately include on the statement required under section 6051— “(i) the portion of the wages which consists of payments for group-term life insurance to which this subsection applies, and 104 STAT. 1388–285 “(ii) the amount of the tax imposed by section 3101 on such payments, and “(C) the tax imposed by section 3101 on such payments shall be paid by the employee. “(2) Benefits to which subsection applies.—This subsection shall apply to any payment for group-term life insurance to the extent— “(A) such payment constitutes wages, and “(B) such payment is for coverage for periods during which an employment relationship no longer exists between the employee and the employer.” (b) Railroad Retirement Taxes.—Section 3202 of such Code (relating to deduction of tax from compensation) is amended by adding at the end thereof the following new subsection: “(d) Special Rule for Certain Taxable Group-Term Life Insurance Benefits.— “(1) In general.— In the case of any payment for group-term life insurance to which this subsection applies— “(A) subsection (a) shall not apply, “(B) the employer shall separately include on the statement required under section 6051— “(i) the portion of the compensation which consists of payments for group-term life insurance to which this subsection applies, and “(ii) the amount of the tax imposed by section 3201 on such payments, and “(C) the tax imposed by section 3201 on such payments shall be paid by the employee. “(2) Benefits to which subsection applies.—This subsection shall apply to any payment for group-term life insurance to the extent— “(A) such payment constitutes compensation, and “(B) such payment is for coverage for periods during which an employment relationship no longer exists between the employee and the employer.” (c) Effective Date.—The amendments made by this section shall apply to coverage provided after December 31, 1990.