[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2034 Introduced in House (IH)]







108th CONGRESS
  1st Session
                                H. R. 2034

To amend the Internal Revenue Code of 1986 to provide that an employer 
shall be liable for Social Security taxes on unreported tips paid to an 
employee only after the Internal Revenue Service establishes the amount 
                   of tips received by that employee.


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                    IN THE HOUSE OF REPRESENTATIVES

                              May 8, 2003

Mr. Herger (for himself and Mr. Tanner) introduced the following bill; 
         which was referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to provide that an employer 
shall be liable for Social Security taxes on unreported tips paid to an 
employee only after the Internal Revenue Service establishes the amount 
                   of tips received by that employee.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Tip Tax Fairness Act of 2003''.

SEC. 2. EMPLOYER LIABLE FOR FICA TAX ON TIPS RECEIVED BY EMPLOYEE ONLY 
              AFTER IRS ESTABLISHES AMOUNT OF TIPS RECEIVED BY THAT 
              EMPLOYEE.

    (a) In General.--Subsection (q) of section 3121 of the Internal 
Revenue Code of 1986 (relating to tips included for both employee and 
employer taxes) is amended by adding at the end the following new 
sentence: ``The Secretary may issue a notice and demand to an employer 
for taxes imposed by section 3111 with respect to tips referred to in 
the exception in the preceding sentence only after the Secretary has 
determined the liability of each employee for taxes imposed by section 
3101 on such tips.''
    (b) Effective Date.--The amendment made by this section shall take 
effect on the date of the enactment of this Act.
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