Basic (11-81)

NL 00711.065 Coverage and Exceptions Paragraphs

1300. BEFORE 1951—SELF-EMPLOYMENT

The Social Security Act did not provide coverage for self-employed persons before 1951.

1305.A BEFORE 1951—AGRICULTURAL LABOR

Your employment before 1951 was of an agricultural nature. This type of employment was not covered by the Social Security Act at that time and pay received for your services may not be credited to your social security earnings record.

1305.B FARM WORK NOT COVERED

Before 1951, farm work was not covered by the Social Security Act.

1310. BEFORE 1951—DOMESTIC EMPLOYMENT

Your employment before 1951 was as a household worker in a private home. This type of employment was not covered by the Social Security Act at that time and may not be credited to your social security earnings record.

1320. BEFORE 1937—GENERAL

Employment before January 1, 1937, is not creditable under the Social Security Act because the Act did not become effective until that date.

1321. BEFORE 1951—OUTSIDE THE UNITED STATES

Beginning in 1951, the services of a U.S. citizen, performed outside the United States as an employee of an American employer, are covered by the Social Security Act.

1323. FOREIGN EMPLOYMENT DETERMINATION

The information you furnished is insufficient for us to determine whether you are employed by an American corporation or by a foreign subsidiary of an American corporation.

1323.1 FOREIGN EMPLOYMENT—EFFECTIVE 1951

(a) or (b) the United States is covered by the Social Security Act if the work is performed by a citizen of the United States as an employee of an American employer.

(a)

Beginning with 1951, employment outside

(b)

Employment outside

A foreign subsidiary of an American corporation is not an American employer under the Act.

1323.2 AMERICAN EMPLOYER

An American employer means an employer who is (1) in the United States or any of its instrumentalities; (2) a State or any political subdivision; (3) a person who is a resident of the United States; (4) a partnership, if two-thirds or more of the partners are residents of the United States; (5) a trust, if all of the trustees are residents of the United States; or (6) a corporation organized under the laws of the United States or of any State.

1323.3 WORK OUTSIDE THE U.S.—EFFECTIVE 1955

Beginning January 1, 1955, the Social Security Act made coverage available to citizens of the United States who are employed outside the United States by a foreign subsidiary of an American corporation. Such coverage may be affected if the American corporation voluntarily enters into an agreement with the Internal Revenue Service. The agreement applies to all citizens of the United States employed by the foreign subsidiary if their work would be covered if performed in the United States.

1. A. 

   Since the        did not enter into such an agreement, your employment is not creditable for social security purposes.

2. B. 

   Since your employment with        was before 1955, it is not creditable for social security purposes.

1323.4 FOREIGN SUBSIDIARY DEFINED

A foreign subsidiary is defined for social security purposes as a foreign corporation of which an American corporation owns 20 percent or more of the voting stock.

If the foreign subsidiary owns more than 50 percent of the voting stock of another foreign corporation, this corporation would also be considered a foreign subsidiary of the American corporation.

1323.5 CONTACT EMPLOYER

You should get in touch with your employer to find out if he has arranged for this coverage.

1325. SELF-EMPLOYMENT OUTSIDE THE UNITED STATES

A citizen of the United States living in a (a) or (b) may receive credit for his self-employment income derived from a covered trade, business, or profession, performed in a (a) or (b) under certain conditions. The Internal Revenue Service is responsible for determining whether such income is taxable for social security purposes. If you want more information about this matter, you may write to the Internal Revenue Service office with whom you filed your income tax returns while residing in the United States, or to the Director, Internal Revenue Service Center, 11601 Roosevelt Blvd., Philadelphia, PA 19155.

(a)

foreign country

(b)

possession of the United States

1325.1 NONRESIDENT ALIEN

Information obtained shows that you are not a citizen or a resident of the United States. Under the law, income earned by a nonresident alien may not be counted as self-employment income.

1330. MINISTER OUTSIDE THE UNITED STATES BEFORE 1968

Before 1968, a clergyman serving outside the United States in the exercise of his ministry could elect social security coverage if he met the following provisions of the law. The clergyman must have been a citizen of the United States and either performing services as an employee of the United States and either performing services as an employee of a United States employer or had a congregation which was composed predominately of citizens of the United States. To elect social security coverage, he must have filed a certificate with the Internal Revenue Service to waive his exemption from coverage.

1. A. 

   Since you did not file (a) or (b) waiver certificate, your self-employment income cannot be used for benefit purposes.

   (a)

   a valid

   (b)

   the required

2. B. 

   If he elected coverage, his earnings must have been reported as if he were self-employed.

1330.1 MINISTERS—BEFORE 1955

Services performed prior to 1955 by a duly ordained, commissioned, or licensed minister of a church in the exercise of his ministry are not covered by the Social Security Act.

1331. MINISTERS—GENERAL UNDER 1967 AMENDMENTS

The Social Security Amendments of 1967 extended coverage to ministerial services performed by duly ordained, commissioned, or licensed ministers of churches, Christian Science practitioners, and members of religious orders who have not taken a vow of poverty. The law was effective for all taxable years ending after 1967, unless the clergyman obtained an exemption from such coverage by filing an application with the Internal Revenue Service stating that he was opposed to coverage on the basis of conscience or religious principle. A clergyman who elected coverage for any taxable year ending before 1968 by the filing of an effective waiver certificate (Form 2031) could not obtain an exemption from such coverage.

1331.1 COVERAGE OF MINISTERIAL SERVICES OUTSIDE THE U.S. — 1967 AMENDMENTS

The earnings from the ministry of a clergyman serving outside the United States for taxable years beginning after 1967 through 1972, are covered by the Social Security Act if he was a citizen of the United States and either performed services an employee of a United States employer or had a congregation which was composed predominately of United States citizens.

1331.2 COVERAGE OF MINISTERIAL SERVICES—1972 AMENDMENTS

For taxable years beginning in 1973, earnings of ministers and members of religious orders serving outside the United States will be covered for social security purposes if they are citizens of the United States.

It is no longer necessary that a minister or member of a religious order serving outside the United States be an employee of an American employer or serve a congregation composed predominately of United States citizens in order to report his income for social security purposes.

1331.3 COVERAGE OF MEMBERS OF RELIGIOUS ORDERS—VOWS OF POVERTY—1972 AMENDMENTS

A religious order whose members are required to take a vow of poverty may elect to have social security coverage for “members” performing services in the exercises of duties required by the order by filing a certificate with the Internal Revenue Service.

1. A. 

   A certificate of election filed by a religious order or by a subdivision, thereof, applies to all current and future members of the order or subdivision.

2. B. 

   A member of a religious order working outside the United States is covered, if:

   1. 1. 

      The order has elected coverage.

   2. 2. 

      The member is a United States citizen.

   3. 3. 

      The individual remains a member of the order.

1331.4 FILING OF WAIVER—GENERAL

A clergyman opposed to coverage who wished to obtain an exemption must have filed an application with the Internal Revenue Service by April 15, 1979, unless he entered the ministry in 1969 or later. In that case, he has until April 15 of the second year after the year in which he became a clergyman to request exemption.

1. A. 

   If you wish to file an application for exemption from social security coverage, you should get in touch with the District Director of Internal Revenue with whom you file your income tax returns.

2. B. 

   If you are uncertain where your returns are filed, you should file your application with the Director of International Operations, Internal Revenue Service, Washington, D.C. 20225.

1331.5 REVOCATION OF EXEMPTION

The 1977 amendments provided that a clergyman may revoke his exemption from coverage under certain specific rules.

1. A. 

   If you wish to file a revocation of your exemption, you should get in touch with the District Director of Internal Revenue with whom you file your income tax returns.

2. B. 

   If you are uncertain where your returns are filed, you should file your revocation with the Director of International Operations, Internal Revenue Service, Washington, D.C. 20225.

1332. SELF-EMPLOYMENT INCOME AFTER 1950

The (a) or (b) provides for the coverage of most self-employed persons whose net earnings from self-employment after 1950 are at least $400 in a taxable year (OPTION BELOW IF APPLICABLE) .

(a)

Social Security Act

(b)

Act

Enclosure, as explained in the (c) (enclosed) pamphlet.

1332.1 NET EARNINGS FROM SELF-EMPLOYMENT DEFINED

The term “net earnings from self-employment” means the gross income, as computed for income tax purposes.

(USE WHEN INDIVIDUAL INQUIRIES)

1. A. 

   derived by a person from his trade, business, or profession, less allowable business deductions.

2. B. 

   derived by a person from all trades, businesses, or professions, carried on by him, less allowable business deductions.

(USE WHERE PARTNERSHIP APPARENT)

1. C. 

   derived by a person from all trades, businesses, or professions, carried on by him, less allowable deductions, plus his distributive share (whether or not distributed) of the ordinary net income or loss from any trade, business, or profession, carried on by a partnership of which he is a member.

1335. LAY MISSIONARY INQUIRIES

Lay missionaries may not elect coverage under the self-employment provisions of the Social Security Act. Their services are covered on the same bases as other employees of the organization for which they work.

1340.1 MILITARY SERVICE (MS)—BEFORE 1957

Prior to 1957, military service was not covered by the Social Security Act.

1340.2 MS AFTER 1956

Beginning January 1, 1957, social security coverage was extended to members of the Armed Forces of the United States on active duty or active duty for training.

1340.3 COMPONENTS COVERED

The coverage applies to:

1. A. 

   members of the regular components of the Army, Navy, Air Force, Marine Corps, and Coast Guard.

2. B. 

   members of the reserve components of the Armed Forces.

3. C. 

   ** commissioned officers of the United States Public Health Services and the National Oceanic and Atmospheric Administration.

4. D. 

   midshipmen and cadets of the service academies.

5. E. 

   members of the Reserve Officers Training Corps when ordered to annual training for 14 days or more.

**NOTE: The National Oceanic and Atmospheric Administration was formerly known as the Coast and Geodetic Survey and later as the Environmental Science Services Administration. Where the incoming shows one of the previous names, add (formerly known as (name used on incoming)).

1340.4 AMOUNT OF PAY COVERED—MILITARY SERVICE (MS)

Basic pay and deemed wage credits for military service may be used to figure the amount of social security benefits payable on an earnings record. For the years after 1956, deemed wage credits may be given in the amount of $300 per calendar quarter regardless of the amount of basic pay paid in the quarter for service as a member of the uniformed military service.

These deemed wage credits are subject to the maximum earnings limitations, but no additional social security contribution will be required for these credits.

1. A. 

   Deemed wage credits are not added to base pay for military service before 1957.

2. B. 

   Base pay does not include (a) (type of pay claimed) .

3. C. 

   The total amount shown on the Form W-2, Wage and Tax Statement, for (b) (year) apparently includes amounts that are not base pay.

1340.5 MS—AFTER 1977

For years after 1977, deemed wage credits may be given in the amount of $100 for each $300 of earnings reported for a member of the uniformed military service. A maximum of $1,200 of deemed wage credits may be granted in any one calendar year.

1340.6 WHO MAKES DETERMINATION

The  (name of service department)  determines whether a member performed services that are covered for social security purposes. If the services are covered, that Department also determines the period of such service, the amount of pay to be reported, and the calendar quarters for which pay is to be credited.

1340.7 PRIORITY USE OF MILITARY SERVICE CREDITS BY SSA AND CIVIL SERVICE COMMISSION

The Civil Service Commission has priority for periods of military service before 1957. Credit for any active service performed before that date will automatically be granted under that system.

Because military service is covered employment after 1956, Social Security Administration has priority over the use of this period of service. The Civil Service Commission will not grant credit for military service after 1956 under its system if the individual is eligible or upon application would be eligible for social security benefits.

The 1977 amendments to the Social Security Act modified the definition of a surviving divorced wife. Effective for benefits payable January 1979, in order for a claimant to be entitled as a surviving divorced wife, the claimant must:

1. a. 

   Be finally divorced from the wage earner (regardless of the date of the divorce); and

2. b. 

   Have been married to him for a period of at least 10 years immediately before the date the divorce became final.

1340.8 REQUESTING EVIDENCE OF MILITARY SERVICE

Your years of military service may increase the amount of benefits to which you are entitled. The military service must be verified, so please send the original or certified copy of “Statement of Service” (DD-13 or DD-14) for each period of your military service.

1340.9 CREDITS BEFORE 1957

A veteran may be given wage credits of $160 for each month of active service in the Armed Forces of the United States from September 16, 1940, through December 31, 1956.

1. A. 

   as explained in the   (enclosed) booklet.

2. B. 

   subject to the limitations explained in the   (enclosed) booklet.

However, credits are not given for short periods of active duty for training purposes limited to less than 90 days performed during this time.

NOTE TO TYPIST: Enclose SSA Publication No. 77-10044 (or current revision)

1340.10 WHEN NO CREDIT GIVEN FOR SERVICE BEFORE 1957

Ordinarily, if no service is performed after December 31, 1956, these wage credits may not be counted for social security purposes if any portion of the military service is used by another Federal agency, either civilian or military (except the Veterans Administration) in establishing entitlement to benefits payable by such agency.

1340.11 WHEN CREDITS ARE USED

A formal determination as to whether these military service wage credits may be granted in a particular case is made by the Social Security Administration from the information furnished by the other agency at the time a claim is filed for social security benefits.

1340.12 HOW CREDITS ARE USED

Where these credits for military service may be used, they count the same as earnings in covered employment, but they are not added to an earnings record until an application for benefits is filed. At that time, the necessary proofs and information concerning military service may be submitted to the representatives of the Social Security Administration.

1340.13 REQUIREMENTS MET

If you meet the requirements for these military wage credits, (a) or (b).

(a)

you may be entitled to additional quarters of coverage which, together with the quarters you have acquired in covered employment, may give you an insured status.

(b)

you may be entitled to        additional quarters of coverage.

1340.15 QC AND MS FOR THE SAME PERIOD

Since you are credited with a quarter of coverage for the period ended         , on the basis of earnings in covered employment, you will not be entitled to a quarter for this same period based on your military service.

1350. EARNINGS OF ALIEN OUTSIDE U.S.

Income received from employment or self-employment outside the United States by a person who is neither a citizen nor a resident of the United States is not creditable under the Social Security Act.

1360. EMPLOYMENT OF ALIEN BY U.S. EMPLOYER OUTSIDE U.S.

Since you are not a citizen of the United States, your employment while outside the United States is not covered under the Social Security Act even though you may work for an American employer.

1371. BOOKLET REFERRAL—FARM EMPLOYEES

Page   of the enclosed publication explains how farm employees may receive social security credit for their earnings.

NOTE TO TYPIST: Enclose SSA Publication No. 73-10021 (or current revision)

1372. EMPLOYMENT DOES NOT MEET TEST

The pay you received for farm work from   (a)   in the calendar quarter ended   (b)   , cannot be credited to your earnings record because (c), (d), or (e) .

(c)

you were paid less than $50 cash in that quarter.

(d)

you worked less than 60 days in that quarter.

(e)

you did not serve a qualifying quarter.

1373. COVERAGE—1951-1954

For the years 1951 through 1954, farm work was covered by the (a) or (b) when the following requirements were met. First, a farmworker must have served a qualifying quarter by being employed an entire calendar quarter by the employer, in any kind of job. Farm work performed during this qualifying quarter was not covered. Second, he must have performed farm work for the same employer on at least 60 days in the following quarter and have been paid $50 or more in cash. Farm work in this quarter was covered and the cash pay counted for social security purposes.

(a)

Act

(b)

Social Security Act

1373.1 COVERAGE CONTINUES

Once a farm worker met these requirements, his services for this employer continued to be covered in the second following quarter if he was paid $50 or more in cash, even though he did not work at least 60 days.

If the farm worker was employed the entire quarter, this employment served as a qualifying quarter for his work in the next quarter. However, if he worked less than 60 days in the quarter, he had to serve another qualifying quarter and meet the 60-day-$50 test in the next quarter before his services in that quarter would be covered.

1373.2 COVERAGE—1955-1956

For the years 1955 and 1956, cash pay for farm work counts for social security purposes if the employer paid the farm worker $100 or more in a calendar year.

1373.3 COVERAGE—1957 TO DATE

Beginning with 1957, cash pay for farm work counts for social security purposes if the worker is paid $150 or more in a calendar year by an employer, or he works for that employer on 20 or more days during the calendar year for cash pay figured on a time basis such as by the hour, day, or week.

1374. EARNINGS NOT COVERED BY PARTICULAR EMPLOYER

Our records do not show that  (a)  reported your earnings for (b) . It appears that you may have been a farm worker for this employer. If so, your earnings record may not be credited with the pay received because such work was not covered by the Social Security Act before 1951.

The pay you received from (a) in (b) as a farm worker cannot be credited to your earnings record because (c), (d), (e), or (f).

(c)

agricultural labor was not covered by the Social Security Act before 1951.

(d)

you were not paid cash wages. Only cash pay for farm work counts for social security purposes.

(e)

you were paid less than $100 cash in (a) (that) (b) (either) year. For the years 1955 and 1956, cash pay for farm work counts for social security purposes if the employer paid the farm worker $100 or more in a calendar year.

(f)

you were paid less than $150 cash and you did not work on 20 or more days during the year for this employer. Beginning with 1957, cash pay for farm work counts for social security purposes if the worker is paid $150 or more in a calendar year by an employer, or if he worked for that employer on 20 or more days during the calendar year for cash pay figured on a time basis such as by the hour, day, or week.

1375. DOMESTIC WORKERS—BEFORE 1951

Before 1951, the Social Security Act excluded from coverage all services of a household nature in or about the private home of the employer.

1376. COVERAGE—1951-1954

For the years 1951 through 1954, household services performed on or about the private home of the employer were covered under the Social Security Act only if the individual was paid cash wages of at least $50 in a calendar quarter by one employer, and worked for that employer 24 or more days in that quarter or the preceding quarter.

1377. COVERAGE—1955 TO DATE

Beginning with 1955, household services may be covered under the (a) or (b) if (c) or (d) paid cash wages of at least $50 by one employer in a calendar quarter (e) .

(a)

Social Security Act

(b)

Act

(c)

the individual

(d)

you are

(e)

, regardless of the number of days worked.

1378. REFERENCE TO BOOKLET—HOUSEHOLD WORKERS

The enclosed publication explains how domestic workers may receive credit for their earnings.**

**NOTE TO TYPIST: Enclose SSA Publication No. 73-10021 (or current revision)

1379. PAYMENT IN OTHER THAN CASH

The value of        that you received from this employer for domestic service cannot be credited to your earnings record. Only cash pay for such service counts for social security purposes.

1380. EMPLOYMENT DOES NOT MEET TEST

The pay you received for household work from (a) (Name of employer) (b), (c), or (d) cannot be credited to your earnings record because you (e) or (f) in (g), (h), or (i) .

(b)

in the calendar quarter ending   .

(c)

in the calendar quarters ending   and   .

(d)

from        through       

(e)

were not paid at least $50 in cash.

(f)

did not work at least 24 days.

(g)

that quarter

(h)

either of these quarters.

(i)

any of the calendar quarters in that period.

1. A. 

   From 1951 through 1954, pay for domestic service in or about the employer's private home counts for social security purposes if the employer paid the employee cash wages of $50 or more in the calendar quarter. In addition, the employee must have worked for this employer on at least some part of 24 days in this calendar quarter or in the quarter immediately preceding it.

2. B. 

   For the years after 1954, the 24-day requirement was removed. Beginning with 1955, a domestic worker's cash wages count if they amount to $50 or more from an employer in a calendar quarter.

3. C. 

   Pay for domestic service in an employer's private household counts for social security purposes only if the employer paid the employee cash wages of $50 or more in a calendar quarter.

1385. FEDERAL GOVERNMENT—BEFORE 1951

Services performed before 1951 for the Federal Government were not covered by the Social Security Act and remuneration received for such services may not be counted toward benefits.

1385.1 FEDERAL EMPLOYMENT—EFFECTIVE 1951

Beginning with 1951, the Social Security Act extended social security coverage to most Federal employees who were not covered under a Federal retirement system.

1390. RAILROAD (RR) EMPLOYMENT (SSN)

Social security number   is in the series assigned to railroad employees. Since the Railroad Retirement Board, 844 Rush Street, Chicago, Illinois 60611, has the records on this series of numbers, we have forwarded your letter to that office for reply.

1390.1 RR BOARD (RRB) ADDRESS

Earnings received for employment covered by the Railroad Retirement Act are reported to the Railroad Retirement Board and not to the Social Security Administration. We suggest that you write to the Railroad Retirement Board for information about earnings in railroad or carrier employment. The address is 844 Rush Street, Chicago, Illinois 60611.

1390.2 RR EMPLOYMENT—LESS THAN 10 YEARS

If a person has less than 10 years of employment covered by the Railroad Retirement Act, a railroad retirement annuity is not payable. Instead, his railroad earnings after 1936 are added to any earnings he had under social security to determine whether he is eligible for social security benefits.

1390.3 BOTH RR&SS BENEFITS

A worker may receive both railroad retirement and social security benefits is he meets the eligibility requirements of each program.

1390.4 RR ANNUITANT

Since (a) claims to have worked in railroad employment for more than 10 years, it appears that (b) is an annuitant under the Railroad Retirement Act.

1390.5 REFERRAL TO RRB

We are, therefore, referring your letter and a copy of (a) letter to (b) , Director, Bureau of Retirement Claims, Railroad Retirement Board, 844 Rush Street, Chicago, Illinois 60611. You may expect a complete report from that office about (c) railroad employment.