coverage of nonprofit organizations which failed to file waiver certificates

coverage of nonprofit organizations which failed to file waiver certificates Sec. 312. (a) (1) Section 3121 (k) (5) of the Internal Revenue Code of 1954 (relating to constructive filing of certificate where refund or credit has been made and new certificate is not filed) is amended— (A) by striking out “prior to the expiration of 180 days after the date of the enactment of this paragraph,” in subparagraph (B) and inserting in lieu thereof “prior to April 1, 1978,”; and (B) by striking out “the 181st day after the date of the enactment of this paragraph,” and “such 181st day” in the matter following subparagraph (B) and inserting in lieu thereof in each instance “April 1, 1978,”. (2) Section 3121 (k) (7) of such Code (relating to payment of both employee and employer taxes for retroactive period by organization in cases of constructive filing) is amended— (A) by striking out “prior to the expiration of 180 days after the date of the enactment of this paragraph” and inserting in lieu thereof “prior to April 1, 1978,”; (B) by striking out “the 181st day after such date,” and inserting in lieu thereof “April 1, 1978,” and (C) by striking out “prior to the first day of the calendar quarter in which such 181st day occurs” and inserting in lieu thereof “prior to that date”. (3) Section 3121 (k) (8) of such Code (relating to extended period for payment of taxes for retroactive coverage) is amended— (A) by striking out “by the end of the 180-day period following the date of the enactment of this paragraph” and inserting in lieu thereof “prior to April 1, 1978,”; (B) by striking out “within that period” and inserting in lieu thereof “prior to April 1, 1978”; and (C) by striking out “on the 181st day following that date” and inserting in lieu thereof “on that date”. (b) (1) Section 3121 (k) (4) of such Code (relating to constructive filing of certificate where no refund or credit of taxes has been made) is amended by adding at the end thereof the following new subparagraph: 91 STAT. 1533 “(C) In the case of any organization which is deemed under this paragraph to have filed a valid waiver certificate under paragraph (1), if— “(i) the period with respect to which the taxes imposed by sections 3101 and 3111 were paid by such organization (as described in subparagraph (A) (ii)) terminated prior to October 1, 1976, or “(ii) the taxes imposed by sections 3101 and 3111 were not paid during the period referred to in clause (i) (whether such period has terminated or not) with respect to remuneration paid by such organization to individuals who became its employees after the close of the calendar quarter in which such period began, taxes under sections 3101 and 3111— “(iii) in the case of an organization which meets the requirements of this subparagraph by reason of clause (i), with respect to remuneration paid by such organization after the termination of the period referred to in clause (i) and prior to July 1, 1977; or “(iv) in the case of an organization which meets the requirements of this subparagraph by reason of clause (ii), with respect to remuneration paid prior to July 1, 1977, to individuals who became its employees after the close of the calendar quarter in which the period referred to in clause (i) began, which remain unpaid on the date of the enactment of this subparagraph, or which were paid after October 19, 1976, but prior to the date of the enactment of this subparagraph, shall not be due or payable (or, if paid, shall be refunded); and the certificate which such organization is deemed under this paragraph to have filed shall not apply to any service with respect to the remuneration for which the taxes imposed by sections 3101 and 3111 (which remain unpaid on the date of the enactment of this subparagraph, or were paid after October 19, 1976, but prior to the date of the enactment of this subparagraph) are not due and payable (or are refunded) by reason of the preceding provisions of this subparagraph. In applying this subparagraph for purposes of title II of the Social Security Act, the period during which reports of wages subject to the taxes imposed by sections 3101 and 3111 were made by any organization may be conclusively treated as the period (described in subparagraph (A) (ii)) during which the taxes imposed by such sections were paid by such organization.”. (2) Section 3121 (k) (4) (A) of such Code is amended by inserting “(subject to subparagraph (C))” after “effective” in the matter following clause (ii). (3) Section 3121(k) (6) of such Code (relating to application of certain provisions to cases of constructive filing) is amended by inserting “(except as provided in paragraph (4) (C))” after “services involved” in the matter preceding subparagraph (A). (4) Section 3121 (k) (4) of such Code is amended by striking out “date” in subparagraph (B) (ii) and inserting in lieu thereof “first day of the calendar quarter”. (c) In any case, where— (1) an individual performed service, as an employee of an organization which is deemed under section 3121(k) (4) of the 91 STAT. 1534 Internal Revenue Code of 1954 to have filed a waiver certificate under section 3121 (k) (1) of such Code, on or after the first day of the applicable period described in subparagraph (A) (ii) of such section 3121(k) (4) and before July 1, 1977; and (2) the service so performed does not constitute employment (as defined in section 210(a) of the Social Security Act and section 3121(b) of such Code) because the waiver certificate which the organization is deemed to have filed is made inapplicable to such service by section 3121 (k) (4) (C) of such Code, but would constitute employment (as so defined) in the absence of such section 3121(k) (4) (C), the remuneration paid for such service shall, upon the request of such individual (filed on or before April 15, 1980, in such manner and form, and with such official, as may be prescribed by regulations made under title II of the Social Security Act) accompanied by full payment of all of the taxes which would have been paid under section 3101 of such Code with respect to such remuneration but for such section 3121 (k) (4) (C) (or by satisfactory evidence that appropriate arrangements have been made for the payment of such taxes in installments as provided in section 3121(k) (8) of such Code), be deemed to constitute remuneration for employment as so defined. In any case where remuneration paid by an organization to an individual is deemed under the preceding sentence to constitute remuneration for employment, such organization shall be liable (notwithstanding any other provision of such Code) for payment of the, taxes which it would have been required to pay under section 3111 of such Code with respect to such remuneration in the absence of such section 3121 (k) (4) (C). (d) Section 3121(k) (8) of the Internal Revenue Code of 1954 (relating to extended period for payment of taxes for retroactive coverage), as amended by subsection (a) (3) of this section, is amended to read as follows: “(8) Extended period for payment of taxes for retroactive coverage.— Notwithstanding any other provision of this title, in any case where— “(A) an organization is deemed under paragraph (4) to have filed a valid waiver certificate under paragraph (1), but the applicable period described in paragraph (4) (A) (ii) has terminated and part or all of the taxes imposed by sections 3101 and 3111 with respect to remuneration paid by such organization to its employees after the close of such period remains payable notwithstanding paragraph (4) (C), or “(B) an organization described in paragraph (5) (A) files a valid waiver certificate under paragraph (1) by March 31, 1978, as described in paragraph (5) (B), or (not having filed such a certificate, by that date) is deemed under paragraph (5) to have filed such a certificate on April 1, 1978, or “(C) an individual files a request under section 3 of Public Law 94–563, or under section 312(c) of the Social Security Amendments of 1977, to have, service treated as constituting remuneration for employment (as defined in section 3121(b) and in section 210(a) of the Social Security Act), the taxes due under sections 3101 and 3111 with respect to services constituting employment by reason of such certificate for any period prior to the first day of the calendar quarter in which the date of such filing or constructive filing occurs, or with respect to service constituting employment by reason of such request, may 91 STAT. 1535be paid in installments over an appropriate period of time, as determined under regulations prescribed by the Secretary, rather than in a lump sum.”. (e) The first sentence of section 3 of Public Law 94–563 (in the matter following paragraph (3)) is amended— (1) by inserting “on or before April 15, 1980,” after “filed”; and (2) by inserting “(or by satisfactory evidence that appropriate arrangements have been made for the repayment of such taxes in installments as provided in section 3121(k) (8) of such Code)” after “so refunded or credited”. (f) Section 3121 (k) (4) (A) (i) of the Internal Revenue Code of 1954 (relating to constructive filing of certificate where no refund or credit of taxes has been made) is amended by striking out “or any subsequent date” and inserting in lieu thereof “(or, if later, as of the earliest date on which it satisfies clause (ii) of this subparagraph.)”. (g) Section 3121 (k) (4) (B) of such Code (relating to constructive filing of certificate where no refund or credit of taxes has been made) is amended— (1) by striking out the period at the end of clause (ii) and inserting in lieu thereof or”; and (2) by adding after clause (ii) the following new clause: “(iii) the organization, prior to the end of the period referred to in clause (ii) of such subparagraph (and, in the case of an organization organized on or before October 9, 1969, prior to October 19, 1976), had applied for a ruling or determination letter acknowledging it to be exempt from income tax under section 501 (c) (3), and it subsequently received such railing or determination letter and did not pay any taxes under sections 3101 and 3111 with respect to any employee with respect to any quarter ending after the twelfth month following the date of mailing of such ruling or determination letter and did not pay any such taxes with respect to any quarter beginning after the later of (I) December 31, 1975 or (II) the date on which such ruling or determination letter was issued.”. (h) The amendments made by subsections (a), (b), (d), (e), (f), and (g) of this section shall be effective as though they had been included as a part of the amendments made to section 3121 (k) of the Internal Revenue Code of 1954 by the first section of Public Law 94–563 (or, in the case of the amendments made by subsection (e), as a part of section 3 of such Public Law).