§11504. Withholding State and local income tax by certain carriers

(a) No part of the compensation paid by a rail carrier providing transportation subject to the jurisdiction of the Commission under subchapter I of chapter 105 of this title to an employee who performs regularly assigned duties as such an employee on a railroad in more than one State shall be subject to the income tax laws of any State or subdivision of that State, other than the State or subdivision thereof of the employee's residence.

(b)(1) No part of the compensation paid by a motor carrier providing transportation subject to the jurisdiction of the Commission under subchapter II of chapter 105 of this title or by a motor private carrier to an employee who performs regularly assigned duties in 2 or more States as such an employee with respect to a motor vehicle shall be subject to the income tax laws of any State or subdivision of that State, other than the State or subdivision thereof of the employee's residence.

(2) In this subsection "employee" has the meaning given such term in section 31132 of this title.

(c)(1) In this subsection, an employee is deemed to have earned more than 50 percent of pay in a State or subdivision of that State in which the time worked by the employee in the State or subdivision is more than 50 percent of the total time worked by the employee while employed during the calendar year.

(2) A water carrier providing transportation subject to the jurisdiction of the Commission under subchapter III of chapter 105 of this title or a water carrier or class of water carriers providing transportation on inland or coastal waters under an exemption under this subtitle shall file income tax information returns and other reports only with-

(A) the State and subdivision of residence of the employee (as shown on the employment records of the carrier); and

(B) the State and subdivision in which the employee earned more than 50 percent of the pay received by the employee from the carrier during the preceding calendar year.

(3) This subsection applies to pay of a master, officer, or sailor who is a member of the crew on a vessel engaged in foreign, coastwise, intercoastal or noncontiguous trade or in the fisheries of the United States.

(d) A rail, motor, and motor private carrier withholding pay from an employee under subsection (a) or (b) of this section shall file income tax information returns and other reports only with the State and subdivision of residence of the employee.

( Pub. L. 95–473, Oct. 17, 1978, 92 Stat. 1446 ; Pub. L. 97–261, §29(d), Sept. 20, 1982, 96 Stat. 1128 ; Pub. L. 101–322, §7, July 6, 1990, 104 Stat. 296 ; Pub. L. 103–272, §5(m)(33), July 5, 1994, 108 Stat. 1378 .)

Historical and Revision Notes

Revised Section	Source (U.S. Code)	Source (Statutes at Large)
11504(a)	49:26a (less (a) words after semicolon).	Feb. 4, 1887, ch. 104, 24 Stat. 379 , §§26, 226A, 324; added Dec. 23, 1970, Pub. L. 91–569, §§1, 2(b), 3(a), 84 Stat. 1499 .
11504(b)	49:325a (less (a) words after semicolon).
11504(c)	49:922b.
11504(d)	49:26a ((a) words after semicolon).
	49:325a ((a) words after semicolon).

The section restates and consolidates the source provisions in one section for clarity. The word "pay" is substituted for "compensation" for consistency in view of chapter 55 of title 5. The words "motor private carrier" are substituted for "private carrier of property by motor vehicle" for consistency in view of the definition of "motor private carrier" in section 10102 of this title. The words "shall withhold" are substituted for "No . . . shall be withheld . . . other than" and "withholding shall be required" for clarity. The words "in at least 2 States" are substituted for "more than one State" for clarity and consistency. The words "received by the employee from the carrier" are inserted for clarity. The words "withholding pay from an employee under subsection (a) or (b) of this section" are inserted for clarity. The words "carrier . . . shall file" are substituted for "nor shall such carrier file . . . other than" for clarity.

Amendments

1994-Subsec. (b)(2). Pub. L. 103–272 substituted "section 31132 of this title" for "section 204 of the Motor Carrier Safety Act of 1984 (49 App. U.S.C. 2503)".

1990-Subsec. (a). Pub. L. 101–322, §7(a), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows:

"(1) In this subsection, an employee is deemed to have earned more than 50 percent of pay in a State or subdivision of a State if the employee-

"(A) performs regularly assigned duties on a locomotive, car, or other track-borne vehicle in at least 2 States and the mileage traveled in one State or subdivision of that State is more than 50 percent of the total mileage traveled by the employee while employed during the calendar year; or

"(B) is engaged principally in maintaining roadways, signals, communications, and structures or in operating motortrucks from railroad terminals in at least 2 States and the percent of the time worked by the employee in one State or subdivision of that State is more than 50 percent of the total time worked by the employee while employed during the calendar year.

"(2) A rail, express, or sleeping car carrier providing transportation subject to the jurisdiction of the Interstate Commerce Commission under subchapter I of chapter 105 of this title shall withhold from the pay of an employee referred to in paragraph (1) of this subsection only income tax required to be withheld by the laws of a State, or subdivision of that State-

"(A) in which the employee earns more than 50 percent of the pay received by the employee from the carrier; or

"(B) that is the residence of the employee (as shown on the employment records of the carrier), if the employee did not earn in one State or subdivision more than 50 percent of the pay received by the employee from the carrier during the preceding calendar year."

Subsec. (b). Pub. L. 101–322, §7(b), amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows:

"(1) In this subsection-

"(A) 'State' includes a State, territory, or possession of the United States, and the Commonwealth of Puerto Rico.

"(B) an employee is deemed to have earned more than 50 percent of pay in a State or subdivision of a State in which the mileage traveled by the employee in that State or subdivision is more than 50 percent of the total mileage traveled by the employee while employed during the calendar year.

"(2) A motor carrier providing transportation subject to the jurisdiction of the Commission under subchapter II of chapter 105 of this title and a motor private carrier shall withhold from the pay of an employee having regularly assigned duties on a motor vehicle in at least 2 States, only income tax required to be withheld by the laws of a State, or subdivision of that State-

"(A) in which the employee earns more than 50 percent of the pay received by the employee from the carrier; or

"(B) that is the residence of the employee (as shown on the employment records of the carrier), if the employee did not earn in one State or subdivision more than 50 percent of the pay received by the employee from the carrier during the preceding calendar year."

Subsec. (d). Pub. L. 101–322, §7(c), struck out "express, sleeping car," after "A rail," and substituted "with the State and subdivision of residence of the employee." for "with-

"(1) the State and subdivision of residence of the employee; and

"(2) the State and subdivision in which withholding of pay is required under subsection (a) or (b) of this section."

1982-Subsec. (c)(3). Pub. L. 97–261 substituted "sailor" for "seaman".

Effective Date of 1982 Amendment

Amendment by Pub. L. 97–261 effective on the 60th day after Sept. 20, 1982, see section 31(a) of Pub. L. 97–261, set out as a note under section 10101 of this title.

Applicability of 1990 Amendment

Pub. L. 103–440, title II, §209, Nov. 2, 1994, 108 Stat. 4621 , provided that: "The amendments made by section 7 of the Amtrak Reauthorization and Improvement Act of 1990 [section 7 of Pub. L. 101–322, amending this section] shall apply to all periods before and after the date of their enactment [July 6, 1990]."

Section Referred to in Other Sections

This section is referred to in section 10521 of this title.