[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 2373 Introduced in Senate (IS)]







110th CONGRESS
  1st Session
                                S. 2373

To amend the Internal Revenue Code of 1986 to provide for residents of 
 Puerto Rico who participate in cafeteria plans under the Puerto Rican 
tax laws an exclusion from employment taxes which is comparable to the 
       exclusion that applies to cafeteria plans under such Code.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           November 15, 2007

Mr. Salazar (for himself and Mr. Kerry) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to provide for residents of 
 Puerto Rico who participate in cafeteria plans under the Puerto Rican 
tax laws an exclusion from employment taxes which is comparable to the 
       exclusion that applies to cafeteria plans under such Code.

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

SECTION 1. EXCLUSION FROM EMPLOYMENT TAXES FOR RESIDENTS OF PUERTO RICO 
              FOR PAYMENTS MADE UNDER A CAFETERIA PLAN WHICH ARE 
              EXCLUDABLE FROM THE PUERTO RICAN INCOME TAX.

    (a) Social Security Taxes.--
            (1) In general.--Paragraph (5) of section 3121(a) of the 
        Internal Revenue Code of 1986 (defining wages) is amended by 
        striking ``or'' at the end of subparagraph (H), by striking the 
        semicolon at the end of subparagraph (I) and inserting ``, 
        or'', and by inserting after subparagraph (I) the following new 
        subparagraph:
                    ``(J) under a plan established under section 
                1022(l) of the Puerto Rico Internal Revenue Code of 
                1994 if such payment would not be treated as wages 
                without regard to such plan and it would be reasonable 
                to believe that (if such section 1022(l) applied for 
                purposes of this section) such section 1022(l) would 
                not treat any wages as constructively received;''.
            (2) Social security act.--Paragraph (4) of section 209(a) 
        of the Social Security Act (defining wages) is amended by 
        adding at the end the following: ``or (L) under a plan 
        established under section 1022(l) of the Puerto Rico Internal 
        Revenue Code of 1994 if such payment would not be treated as 
        wages without regard to such plan and it would be reasonable to 
        believe that (if such section 1022(l) applied for purposes of 
        this section) such section 1022(l) would not treat any wages as 
        constructively received;''.
    (b) Unemployment Insurance.--Paragraph (5) of section 3306(b) of 
such Code (defining wages) is amended by striking ``or'' at the end of 
subparagraph (G), by adding ``or'' at the end of subparagraph (H), and 
by inserting after subparagraph (H) the following new subparagraph:
                    ``(I) under a plan established under section 
                1022(l) of the Puerto Rico Internal Revenue Code of 
                1994 if such payment would not be treated as wages 
                without regard to such plan and it would be reasonable 
                to believe that (if such section 1022(l) applied for 
                purposes of this section) such section 1022(l) would 
                not treat any wages as constructively received;''.
    (c) Effective Date.--The amendments made by this section shall 
apply to remuneration paid after the date of the enactment of this Act.
                                 <all>