Basic (12-03)

SL 80001.801 State Reporting Responsibilities

A. PRE-1987

Prior to 1987, SSA was responsible for ensuring that each State paid the correct amount of Social Security contributions for all employees covered under its Section 218 Agreement. The State Social Security Administrators were responsible for ensuring that State and local government employers filed timely and accurate returns and that they collected and paid the proper amount of Social Security and Medicare contributions to the Federal government.


With few exceptions, all required wage reports have been filed by all States for years prior to 1987 and all audits closed. Therefore, information regarding the reporting of pre-1987 wages, liability, auditing, adjustments and corrections to pre-1987 wage reports is not included in the SLCH. However, this information is still pertinent with respect to wages paid before 1987. Similarly, the statute of limitations rules concerning the extent of time under which States are held liable for contributions on wages paid prior to 1987 are not included in the SLCH.

B. POST-1986

Effective January 1, 1987, Public Law 99-509 transferred responsibility for collecting FICA taxes for wages paid under Section 218 Agreements from SSA and the States to the IRS. State and local employers are required to file quarterly Form 941, Employer's Quarterly Federal Tax Return, with IRS. IRS is responsible for collecting Social Security and Medicare taxes, verifying the amount owed and determining that the amount owed has been deposited.


The following subsections of Section 218 of the Act were repealed but still remain applicable to wages paid before 1987:

  • Section 218(e)-Payments and Reports by States

  • Section 218(h)-Deposits in Trust Funds

  • Section 218(i)-Regulations

  • Section 218(j)-Failure to Make Payments

  • Section 218(q)-Time Limitation on Assessments

  • Section 218(r)-Time Limitation on Credits and Refunds

  • Section 218(s)-Review by Secretary

  • Section 218(t)-Review by Court

  • Section 218(w)-Payments of Medicare Tax.


Although the State’s liability and collection responsibility ended after 1986, States are still responsible for resolving Social Security payment and wage reporting questions concerning wages paid before 1987.

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SL 80001.801 - State Reporting Responsibilities - 12/09/2003
Batch run: 12/09/2003