http://www.whitehouse.gov/jobsact/read-the-bill
Full Text of the American Jobs Act
http://www.whitehouse.gov/jobsact/read-the-bill#SEC
227
*SECTION 101 - Reduces substantially the amount paid by businesses and
employees into the Social Security system. This will have the impact of
giving business the ability to reduce paying their share of employees Social
Security benefits and also reduces the amount employees pay toward this
program. When employees go to get their benefits in the near future they
will find that they have underpaid and may not eligible for full benefits
Social Security benefits in the future.
Imagine giving large corporations a tax break which undermines our Social
Security System. Write to your elected officials and
oppose giving our corporations another tax break at the expense of our Social
Security Program.
Oppose Section 101 of the American Jobs Act Today
Toll Free # for all of our elected officials: (1866)
220-0044
Contact the White House: http://www.whitehouse.gov/contact
In December 2010, Social Security payroll reductions were reduced in a bill
passed by Congress. Now they will be reduced again
this time giving corporations a big break at our expense. Indeed
taxpayers will have to pick up the differences in what is not collected
as the missing funds will now come out of our taxes paid into the general
fund. Thus, we are once again subsidizing our large
corporations.
Full Text below of Section 101 of the American Jobs
Act*
*SEC. 101. TEMPORARY PAYROLL TAX CUT FOR EMPLOYERS, EMPLOYEES AND THE
SELF-EMPLOYED *
(a) WAGES.-- Notwithstanding any other provision of law—
(1) with respect to remuneration received during the payroll tax holiday
period, the rate of tax under 3101(a) of the Internal Revenue Code of 1986
shall be 3.1 percent (including for purposes of determining the applicable
percentage under sections 3201(a) and 3211(a) of such Code), and
(2) with respect to remuneration paid during the payroll tax holiday period,
the rate of tax under 3111(a) of such Code shall be 3.1 percent (including
for purposes of determining the applicable percentage under sections 3221(a)
and 3211(a) of such Code).
(3)
Subsection (a)(2) shall only apply to
(A) employees performing services in a trade or business of a qualified
employer, or
(B) in the case of a qualified employer exempt from tax under section
501(a), in furtherance of the activities related to the purpose or function
constituting the basis of the employer’s exemption under section 501.
(4) Subsection (a)(2) shall apply only to the first $5 million of
remuneration or compensation paid by a qualified employer subject to section
3111(a) or a corresponding amount of compensation subject to 3221(a).
(b) SELF-EMPLOYMENT TAXES.—
(1) IN GENERAL.—Notwithstanding any other provision of law, with respect to
any taxable year which begins in the payroll tax holiday period, the rate of
tax under section 1401(a) of the Internal Revenue Code of 1986 shall be
(A) 6.2 percent on the portion of net earnings from self-employment
subject
to 1401(a) during the payroll tax period that does not exceed the amount of
the excess of $5 million over total remuneration, if any, subject to section
3111(a) paid during the payroll tax holiday period to employees of the
self-employed person, and
(B) 9.3 percent for any portion of net earnings from self-employment not
subject to subsection (b)(1)(A).
(2) COORDINATION WITH DEDUCTIONS FOR EMPLOYMENT TAXES.—For purposes of
the
Internal Revenue Code of 1986, in the case of any taxable year which begins
in the payroll tax holiday period—
(A) DEDUCTION IN COMPUTING NET EARNINGS FROM SELF-EMPLOYMENT.—The deduction
allowed under section 1402(a)(12) of such Code shall be the sum of (i) 4.55
percent times the amount of the taxpayer’s net earnings from self-employment
for the taxable year subject to paragraph (b)(1)(A) of this section, plus
(ii) 7.65 percent of the taxpayer’s net earnings from self-employment in
excess of that amount.
(B) INDIVIDUAL DEDUCTION.— The deduction under section 164(f) of such Code
shall be equal to the sum of ((i) one-half of the taxes imposed by section
1401(after the application of this section) with respect to the taxpayer’s
net earnings from self-employment for the taxable year subject to paragraph
(b)(1)(A) of this section plus (ii) 62.7 percent of the taxes imposed by
section 1401 (after the application of this section) with respect to the
excess.
(c) REGULATORY AUTHORITY.–The Secretary may prescribe any such regulations
or other guidance necessary or appropriate to carry out this section,
including the allocation of the excess of $5 million over total remuneration
subject to section 3111(a) paid during the payroll tax holiday period among
related taxpayers treated as a single qualified employer.
(d) DEFINITIONS.—
*(1) PAYROLL TAX HOLIDAY PERIOD.—The term ‘payroll tax holiday period’
means
calendar year 2012.*
(2) QUALIFIED EMPLOYER.—For purposes of this paragraph,
(A) In general. -- The term “qualified employer” means any employer other
than the United States, any State or possession of the United States, or any
political subdivision thereof, or any instrumentality of the foregoing.
(B) Treatment of employees of post-secondary educational institutions.--
Notwithstanding paragraph (A), the term “qualified employer” includes any
employer which is a public institution of higher education (as defined in
section 101 of the Higher Education Act of 1965).
(3) AGGREGATION RULES. – For purposes of this subsection rules similar to
sections 414(b), 414(c), 414(m) and 414(o) shall apply to determine when
multiple entities shall be treated as a single employer, and rules with
respect to predecessor and successor employers may be applied, in such
manner as may be prescribed by the Secretary.
(e) TRANSFERS OF FUNDS.--
*(1) Transfers to federal old-age and survivors insurance trust fund.—There
are hereby appropriated to the Federal Old-Age and Survivors Trust Fund and
the Federal Disability Insurance Trust Fund established under section 201 of
the Social Security Act (42 U.S.C. 401) amounts equal to the reduction in
revenues to the Treasury by reason of the application of subsections (a) and
(b) to employers other than those described in (e)(2). Amounts appropriated
by the preceding sentence shall be transferred from the general fund at such
times and in such manner as to replicate to the extent possible the
transfers which would have occurred to such Trust Fund had such amendments
not been enacted.*
**
*(2) Transfers to social security equivalent benefit Account. –There are
hereby appropriated to the Social Security Equivalent Benefit Account
established under section 15A(a) of the Railroad Retirement Act of 1974 (45
U.S.C. 231n-1(a)) amounts equal to the reduction in revenues to the Treasury
by reason of the application of subsection (a) to employers subject to the
Railroad Retirement Tax. Amounts appropriated by the preceding sentence
shall be transferred from the general fund at such times and in such manner
as to replicate to the extent possible the transfers which would have
occurred to such Account had such amendments not been enacted.*
(f) COORDINATION WITH OTHER FEDERAL LAWS.—For purposes of applying any
provision of Federal law other than the provisions of the Internal Revenue
Code of 1986, the rate of tax in effect under section 3101(a) of such Code
shall be determined without regard to the reduction in such rate under this
section.
SEC. 102. TEMPORARY TAX CREDIT FOR INCREASED PAYROLL.
(a) In General.—Notwithstanding any other provision of law, each qualified
employer shall be allowed, with respect to wages for services performed for
such qualified employer, a payroll increase credit determined as follows:
(1) With respect to the period from October 1, 2011 through December 31,
2011, 6.2 percent of the excess, if any, (but not more than $12.5 million of
the excess) of the wages subject to tax under section 3111(a) of the
Internal Revenue Code of 1986 for such period over such wages for the
corresponding period of 2010.
(2) With respect to the period from January 1, 2012 through December 31,
2012,
(A) 6.2 percent of the excess, if any, (but not more than $50 million of
the excess) of the wages subject to tax under section 3111(a) of the
Internal Revenue Code of 1986 for such period over such wages for
calendar
year 2011, minus
(B) 3.1 percent of the result (but not less than zero) of subtracting from
$5 million such wages for calendar year 2011.
(3) In the case of a qualified employer for which the wages subject to tax
under section 3111(a) of the Internal Revenue Code of 1986 (a) were zero for
the corresponding period of 2010 referred to in subsection (a)(1), the
amount of such wages shall be deemed to be 80 percent of the amount of wages
taken into account for the period from October 1, 2011 through December 31,
2011 and (b) were zero for the calendar year 2011 referred to in subsection
(a)(2), then the amount of such wages shall be deemed to be 80 percent of
the amount of wages taken into account for 2012.
(4) This subsection (a) shall only apply with respect to the wages of
employees performing services in a trade or business of a qualified employer
or, in the case of a qualified employer exempt from tax under section 501(a)
of the Internal Revenue Code of 1986, in furtherance of the activities
related to the purpose or function constituting the basis of the employer’s
exemption under section 501.
(b) Qualified employers. – For purposes of this section—
(1) In general.—The term `qualified employer' means any employer other than
the United States, any State or possession of the United States, or any
political subdivision thereof, or any instrumentality of the foregoing.
(2) Treatment of employees of post-secondary educational
institutions.—Notwithstanding subparagraph (1), the term “qualified
employer” includes any employer which is a public institution of higher
education (as defined in section 101 of the Higher Education Act of 1965).
(c)
Aggregation rules. – For purposes of this subsection rules
similar to sections 414(b), 414(c), 414(m) and 414(o) of the Internal
Revenue Code of 1986 shall apply to determine when multiple entities shall
be treated as a single employer, and rules with respect to predecessor and
successor employers may be applied, in such manner as may be prescribed by
the Secretary.
(d)
Application of credits. – The payroll increase credit shall
be treated as a credit allowable under Subtitle C of the Internal Revenue
Code of 1986 under rules prescribed by the Secretary of the Treasury,
provided that the amount so treated for the period described in section
(a)(1) or section (a)(2) shall not exceed the amount of tax imposed on the
qualified employer under section 3111(a) of such Code for the relevant
period. Any income tax deduction by a qualified employer for amounts
paid
under section 3111(a) of such Code or similar Railroad Retirement Tax
provisions shall be reduced by the amounts so credited.
* (e) Transfers
to Federal Old-Age and Survivors Insurance Trust
Fund.—There are hereby appropriated to the Federal Old-Age and Survivors
Trust Fund and the Federal Disability Insurance Trust Fund established under
section 201 of the Social Security Act (42 U.S.C. 401) amounts equal to the
reduction in revenues to the Treasury by reason of the amendments made by
subsection (d). Amounts appropriated by the preceding sentence shall be
transferred from the general fund at such times and in such manner as to
replicate to the extent possible the transfers which would have occurred to
such Trust Fund had such amendments not been enacted.
*
(f)
Application to Railroad Retirement Taxes. For purposes of
qualified employers that are employers under section 3231(a)of the Internal
Revenue Code of 1986, subsections (a)(1) and (a)(2) of this section shall
apply by substituting section 3221 for section 3111, and substituting the
term “compensation” for “wages” as appropriate.