Page:United States Statutes at Large Volume 100 Part 3.djvu/1107

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2915

for services which are described in section 3121(b)(8)(B) (and are not described in section 3121(b)(8)(A))." (B) TECHNICAL AND CONFORMING AMENDMENTS.—

(i) NET EARNINGS.—Paragraph (14) of section 1402(a) of such Code (defining net earnings from self-employment) is amended to read as follows: "(14) in the case of church employee income, the special rules of subsection (j)(1) shall apply." (ii) SELF-EMPLOYMENT INCOME.—Subsection (b) of section 1402 of such Code is amended by adding at the end thereof the following new sentence: "In the case of church employee income, the special rules of subsection (j)(2) shall apply for purposes of paragraph (2)." (iii) CONFORMING AMENDMENT.—The second sentence

of section 1402(b) of such Code is amended by striking out "clause (1)" and inserting in lieu thereof "paragraph (1)". (2) AMENDMENTS OF SOCIAL SECURITY ACT.—

(A) IN GENERAL.—Section 211 of the Social Security Act is amended by adding at the end thereof the following new subsection: "(i)(1) In applying subsection (a)— "(A) church employee income shall not be reduced by any deduction; "(B) church employee income and deductions attributable to such income shall not be taken into account in determining the amount of other net earnings from self-employment. "(2)(A) Subsection (b)(2) shall be applied separately— "(i) to church employee income, and "(ii) to other net earnings from self-employment. "(B) In applying subsection (b)(2) to church employee income, '$100' shall be substituted for '$400'. "(3) Paragraph (1) shall not apply to any amount allowable as a deduction under subsection (a)(ll), and paragraph (1) shall be applied before determining the amount so allowable. "(4) For purposes of this section, the term 'church employee income' means gross income for services which are described in section 210(a)(8)(B) (and are not described in section 210(a)(8)(A))." (B) TECHNICAL AND CONFORMING AMENDMENTS.—

(i) NET EARNINGS.—Section 211(a)(13) of such Act is amended to read as follows: "(13) In the case of church employee income, the special rules of subsection (i)(1) shall apply." (ii) SELF-EMPLOYMENT INCOME.—Section 211(b) of such Act is amended by adding at the end thereof the following new sentence: "In the case of church employee income, the special rules of subsection (i)(2) shall apply for purposes of paragraph (2)." (3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to remuneration paid or derived in taxable years beginning after December 31, 1985. (c) REVOCATION OF ELECTION UNDER SECTION 3121(W).—Paragraph

(2) of section 3121(w) of the Internal Revenue Code of 1954 (relating to timing and duration of election) is amended by striking out the last 2 sentences and inserting in lieu thereof the following: "The election may be revoked by the church or organization under regulations prescribed by the Secretary. The election shall be revoked by

�