DEPARTMENT OF THE TREASURY, OFFICE OF COMMISSIONER OF INTERNAL REVENUE, Washington 25, D.C. To Officers and Employees of the Internal Revenue Service and Others Concerned: On September 12, 1958, notice of proposed rulemaking with respect to the amendment of Subpart A of the Employment Tax Regulations (26 CFR Part 31), in order to supersede the Regulations on Monthly Returns and Payment of Employment Taxes (26 CFR Part 39) and insert certain other introductory material, and with respect to certain administrative regulations of special application to the employment taxes imposed by subtitle C (chapters 21 to 25, inclusive) of the Internal Revenue Code of 1954 was published in the Federal Register (23 F.R. 7071). After consideration of all such relevant matter as was presented by interested persons regarding the rules proposed, the amendment of Subpart A of the Employment Tax Regulations, and the administrative regulations of special application to the employment taxes, are hereby adopted. PARAGRAPH 1. Subpart A of the Employment Tax Regulations (26 CFR Part 31) is amended as follows: (A) By revising paragraph (a) (7) of § 31.0-2 to read as follows: (7) District director means district director of internal revenue. The term also includes the Director of International Operations in all cases where the authority to perform the functions which may be performed by a district director has been delegated to the Director of International Operations. (B) By striking the parenthetical material at the end of paragraph (e) of § 31.0-3 and inserting in lieu thereof the following: (For prior regulations on the subject matter of section 3503, see §§ 411.802 and 408.803 of Regulations 114 and Regulations 128, respectively; 26 CFR (1939) Parts 411 and 408. For prior regulations on the subject matter of section 3504, see §§ 406.807 and 408.906 of Regulations 120 and Regulations 128, respectively; 26 CFR (1939) Parts 406 and 408.) (C) By adding the following at the end of § 31.0-4: The Regulations on Monthly Returns and Payment of Employment Taxes (26 CFR Part 39) are also superseded. AUTHORITY: Amendment of Subpart A of the Employment Tax Regulations (26 CFR Part 31), issued under sec. 7805, I.R.C. 1954; 68A Stat. 917; 26 U.S.C. 7805). PAR. 2. The following regulations are prescribed under chapter 25 of the Internal Revenue Code of 1954 and under selected provisions of subtitle F of such Code: TABLE OF CONTENTS EMPLOYMENT TAXES SUBPART F.-GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES (CHAPTER 25, INTERNAL REVENUE CODE OF 1954) Section 31.3501 31.3502 Statutory provisions; collection and payment of taxes. Statutory provisions; nondeductibility of taxes in computing taxable income. Section 31.3502-1 31.3503 31.3503-1 31.3504 31.3504-1 Nondeductibility of taxes in computing taxable income. Tax under chapter 21 or 22 paid under wrong chapter. SUBPART G.-ADMINISTRATIVE PROVISIONS OF SPECIAL APPLICA- Statutory provisions; notice or regulations requiring records, statements, and special returns. Section 31.6001 31.6001-1 Records in general. 31.6001-2 31.6001-3 31.6001-4 31.6001-5 31.6011 (a) Additional records under Federal Insurance Contributions Act. Additional records in connection with collection of income tax at Statutory provisions; general requirement of return, statement, 31.6011(a)-1 Returns under Federal Insurance Contributions Act. 31.6011(a)-6 Final returns. 31.6011(a)-7 Execution of returns. 31.6071 (a) 31.6071(a)-1 31.6081 (a) 31.6081 (a)-1 31.6151 31.6151-1 31.6302 (c) 31.6302 (c)-1 Statutory provisions; time for filing returns and other documents. Statutory provisions; extension of time for filing returns. Statutory provisions; time and place for paying tax shown on Time for paying tax. Statutory provisions; mode or time of collection; use of Government depositaries. Use of Government depositaries in connection with taxes under Federal Insurance Contributions Act and income tax withheld. Use of Government depositaries in connection with employee and employer taxes under Railroad Retirement Tax Act. 31.6302(c)-3 Cross references. 31.6302(c)-2 AUTHORITY: §§ 31.3501 to 31.6302 (c)-3, incl., issued under sec. 7805, I.R.C. 1954; 68A Stat. 917; U.S.C. 7805. SUBPART F.-GENERAL PROVISIONS RELATING TO EMPLOYMENT TAXES (CHAPTER 25, INTERNAL REVENUE CODE OF 1954) § 31.3501 STATUTORY PROVISIONS; COLLECTION AND PAYMENT OF TAXES. SEC. 3501. COLLECTION AND PAYMENT OF TAXES. The taxes imposed by this subtitle shall be collected by the Secretary or his delegate and shall be paid into the Treasury of the United States as internal-revenue collections. § 31.3502 STATUTORY PROVISIONS; NONDEDUCTIBILITY OF TAXES IN COMPUTING TAXABLE INCOME. SEC. 3502. NONDEDUCTIBILITY OF TAXES IN COMPUTING TAX- (a) The taxes imposed by section 3101 of chapter 21, and by sections 3201 and 3211 of chapter 22 shall not be allowed as a deduction to the taxpayer in computing taxable income under subtitle A. (b) The tax deducted and withheld under chapter 24 shall not be allowed as a deduction either to the employer or to the recipient of the income in computing taxable income under subtitle A. § 31.3502-1 NONDEDUCTIBILITY OF TAXES IN COMPUTING TAXABLE INCOME.For provisions relating to the nondeductibility, in computing taxable income under subtitle A, of the taxes imposed by sections 3101, 3201, and 3211, and the tax deducted and withheld under chapter 24, see the provisions of the Income Tax Regulations (Part 1 of this chapter) under section 164. For provisions relating to the credit allowable to the recipient of the income in respect of the tax deducted and withheld under chapter 24, see the provisions of the Income Tax Regulations under section 31. § 31.3503 STATUTORY PROVISIONS; ERRONEOUS PAYMENTS. SEC. 3503. ERRONEOUS PAYMENTS. Any tax paid under chapter 21 or 22 by a taxpayer with respect to any period with respect to which he is not liable to tax under such chapter shall be credited against the tax, if any, imposed by such other chapter upon the taxpayer, and the balance, if any, shall be refunded. 8 31.3503-1 TAX UNDER CHAPTER 21 or 22 PAID UNDER WRONG CHAPTER.—If, for any period, an amount is paid as tax. (a) Under chapter 21 or corresponding provisions of prior law by a person who is not liable for tax for such period under such chapter or prior law, but who is liable for tax for such period under chapter 22 or corresponding provisions of prior law, or (b) Under chapter 22 or corresponding provisions of prior law by a person who is not liable for tax for such period under such chapter or prior law, but who is liable for tax for such period under chapter 21 or corresponding provisions of prior law, the amount so paid shall be credited against the tax for which such person is liable and the balance, if any, shall be refunded. Each claim for refund or credit under this section shall be made on Form 843 and in accordance with the applicable provisions of the regulations in this part and the applicable provisions of the Regulations on Procedure and Administration (Part 301 of this chapter) under section 6402. § 31.5304 STATUTORY PROVISIONS; ACTS TO BE PERFORMED BY AGENTS. SEC. 3504. ACTS TO BE PERFORMED BY AGENTS. In case a fiduciary, agent, or other person has the control, receipt, custody, or disposal of, or pays the wages of an employee or group of employees, employed by one or more employers, the Secretary or his delegate, under regulations prescribed by him, is authorized to designate such fiduciary, agent, or other person to perform such acts as are required of employers under this title and as the Secretary or his delegate may specify. Except as may be otherwise prescribed by the Secretary or his delegate, all provisions of law (including penalties) applicable in respect of an employer shall be applicable to a fiduciary, agent, or other person so designated but, except as so provided, the employer for whom such fiduciary, agent, or other person acts shall remain subject to the provisions of law (including penalties) applicable in respect of employers. [Sec. 3504 as amended by sec. 71, Technical Amendments Act 1958 (72 Stat. 1660)] § 31.3504-1 ACTS TO BE PERFORMED BY AGENTS.—(a) In general.-In the event wages as defined in chapter 21 or 24 of the Internal Revenue Code of 1954, or compensation as defined in chapter 22 of such Code, of an employee or group of employees, employed by one or more employers, is paid by a fiduciary, agent, or other person, or if such fiduciary, agent, or other person has the control, receipt, custody, or disposal of such wages or compensation, the district director may, subject to such terms and conditions as he deems proper, authorize such fiduciary, agent, or other person to perform such acts as are required of such employer or employers under those provisions of the Internal Revenue Code of 1951 and the regulations thereunder which have application, for purposes of the taxes imposed by such chapter or chapters, in respect of such wages or compensation. If the fiduciary, agent, or other person is authorized by the district director to perform such acts, all provisions of law (including penalties) and of the regulations prescribed in pursuance of law applicable to employers in respect of such acts shall be applicable to such fiduciary, agent, or other person. However, each employer for whom such fiduciary, agent, or other person performs such acts shall remain subject to all provisions of law (including penalties) and of the regulations prescribed in pursuance of law applicable to an employer in respect of such acts. Any application for authorization to perform such acts, signed by such fiduciary, agent, or other person, shall be filed with the district director with whom the fiduciary, agent, or other person will, upon approval of such application, file returns in accordance with such authorization. (b) Prior authorizations continued.-An authorization in effect under section 1632 of the Internal Revenue Code of 1939 on December 31, 1954, continues in effect under section 3504 and is subject to the provisions of paragraph (a) of this section. SUBPART G-ADMINISTRATIVE PROVISIONS OF SPECIAL APPLICATION TO EMPLOYMENT TAXES (SELECTED PROVISIONS OF SUBTITLE F, INTERNAL REVENUE CODE OF 1954) § 31.6001 STATUTORY PROVISIONS; NOTICE OR REGULATIONS REQUIRING, RECORDS, STATEMENTS, AND SPECIAL RETURNS. SEC. 6001. NOTICE OR REGULATIONS REQUIRING RECORDS, Every person liable for any tax imposed by this title, or for the collection thereof, shall keep such records, render such statements, make such returns, and comply with such rules and regulations as the Secretary or his delegate may from time to time prescribe. Whenever in the judgment of the Secretary or his delegate it is necessary, he may require any person, by notice served upon such person or by regulations, to make such returns, render such statements, or keep such recordss, as the Secretary or his delegate deems sufficient to show whether or not such person is liable for tax under this title. § 31.6001-1 RECORDS IN GENERAL.-(a) Form of records.-The records required by the regulations in this part shall be kept accurately, but no particular form is required for keeping the records. Such forms and systems of accounting shall be used as will enable the district director to ascertain whether liability for tax is incurred and, if so, the amount thereof. (b) Copies of returns, schedules, and statements. Every person who is required, by the regulations in this part or by instructions applicable to any form prescribed thereunder, to keep any copy of any return, schedule, statement, or other document, shall keep such copy as a part of his records. (c) Records of claimants.-Any person (including an employee) who, pursuant to the regulations in this part, claims a refund, credit, or abatement, shall keep a complete and detailed record with respect to the tax, interest, addition to the tax, additional amount, or assessable penalty to which the claim relates. Such record shall include any records required of the claimant by paragraph (b) of this section and by § § 31.6001-2 to 31.6001–5, inclusive, which relate to the claim. (d) Records of employees.-While not mandatory (except in the case of claims), it is advisable for each employee to keep permanent, accurate records showing the name and address of each employer for whom he performs services as an employee, the dates of beginning and termination of such services, the information with respect to himself which is required by the regulations in this subpart to be kept by employers, and the receipts furnished in accordance with the provisions of § 31.6051-1. (e) Place and period for keeping records.—(1) All records required by the regulations in this part shall be kept, by the person required to keep them, at one or more convenient and safe locations accessible to internal revenue officers, and shall at all times be available for inspection by such officers. (2) Except as otherwise provided in the following sentence, every person required by the regulations in this part to keep records in respect of a tax (whether or not such person incurs liability for such tax) shall maintain such records for at least four years after the due date of such tax for the return period to which the records relate, or the date such tax is paid, whichever is the later. The records of claimants required by paragraph (c) of this section shall be maintained for a period of at least four years after the date the claim is filed. (f) Cross reference.-See §§ 31.6001-2 to 31.6001-5, inclusive, for additional records required with respect to the Federal Insurance Contributions Act, the Railroad Retirement Tax Act, the Federal Unemployment Tax Act, and the collection of income tax at source on wages, respectively. § 31.6001-2. ADDITIONAL RECORDS UNDER FEDERAL INSURANCE CONTRIBUTIONS ACT.-(a) In general.—(1) Every employer liable for tax under the Federal Insurance Contributions Act shall keep records of all remuneration, whether in cash or in a medium other than cash, paid to his employees after 1954 for services (other than agricultural labor which constitutes or is deemed to constitute employment, domestic service in a private home of the employer, or service not in the course of the employer's trade or business) performed for him after 1936. Such records shall show with respect to each employee receiving such remuneration (i) The name, address, and account number of the employee and such additional information with respect to the employee as is required by paragraph (c) of § 31.6011(b)-2 when the employee does not advise the employer what his account number and name are as shown on an account number card issued to the employee by the Social Security Administration. (ii) The total amount and date of each payment of remuneration (including any sum withheld therefrom as tax or for any other reason) and the period of services covered by such payment. (iii) The amount of each such remuneration payment which constitutes wages subject to tax. See §§ 31.3121 (a)-1 to 31.3121(a)(10)-1, inclusive, of Subpart B of the regulations in this part. (iv) The amount of employee tax, or any amount equivalent to employee tax, collected with respect to such payment, and, if collected at a time other than the time such payment was made, the date collected. See paragraph (b) of § 31.3102-1 of Subpart B of the regulations in this part for provisions relating to collections of amounts equivalent to employee tax. (v) If the total remuneration payment (subdivision (ii) of this subparagraph) and the amount thereof which is taxable (subdivision (iii) of this subparagraph) are not equal, the reason therefor. (2) Every employer shall keep records of the details of each adjustment or settlement of taxes under the Federal Insurance Contributions Act made pursuant to the regulations in this part. The employer shall keep as a part of his records a copy of each statement furnished pursuant to paragraph (c) of § 31.6011(a)-1. (b) Agricultural labor, domestic service, and service not in the course of employer's trade or business.-(1) Every employer who pays cash remuneration after 1954 for the performance for him after 1950 of agricultural labor which constitutes or is deemed to constitute employment, of domestic service in a private home of the employer not on a farm operated for profit, or of service not in the course of his trade or business shall keep records of all such cash remuneration with respect to which he incurs, or expects to incur, liability for the taxes imposed by the Federal Insurance Contributions Act, or with respect to which amounts equivalent to employee tax are deducted pursuant to section 3102(a). See §§ 31.3101-3, 31.3111-3, and 31.3121 (a)-2 of Subpart B of the regulations in this part for provisions relating, respectively, to the liability for employee tax which is incurred when wages are received, the liability for employer tax which is incurred when wages are paid, and the time when wages are paid and received. Such records shall show with respect to each employee receiving such cash remuneration (i) The name of the employee. (ii) The account number of each employee to whom wages for such services are paid within the meaning of § 31.3121 (a) -2 of Subpart B of the regulations in this part, and such additional information as is required by paragraph (c) of § 31.6011 (b)-2 when the employee does not advise the employer what his account number and name are as shown on an account number card issued to the employee by the Social Security Administration. (iii) The amount of such cash remuneration paid to the employee (including any sum withheld therefrom as tax or for any other reason) for agricultural labor |