the time at which such amount would normally be due.

Upon refusal to pay, or failure to pay or give bond, the collector shall proceed immediately to collect the tax, penalty, and interest, by distraint, without regard to the 10-day period after notice and demand prescribed in section 3690. (See § 323.53.)

SEC. 3304. REDEMPTION OF STAMPS.

(a) Authorization. The Commissioner, subject to regulations prescribed by the Secretary, may, upon receipt of satisfactory evidence of the facts, make allowance for or redeem such of the stamps, issued under authority of law, to denote the payment of any internal revenue tax where the rates or duties represented thereby have been excessive in amount, paid in error, or in any manner wrongfully collected.

*

(b) Method and conditions of allowance. Such allowance or redemption may be made * by refunding the amount or value to the owner thereof *; but no allowance or redemption shall be made in any case until the stamps shall have been returned to the Commissioner, or until satisfactory proof has been made showing the reason why the same can not be returned

(c) Time for filing claims. No claim for the redemption of or allowance for stamps shall be allowed unless presented within four years after the purchase of such stamps from the Government.

(d) Finality of Commissioner's decisions. The finding of facts in and the decision of the Commissioner upon the merits of any claim presented under or authorized by this section shall, in the absence of fraud or mistake in mathematical calculation, be final and not subject to revision by any accounting officer.

four years next after the payment of such tax, penalty, or sum. The amount of the refund · • shall not exceed the portion of the tax, penalty, or sum paid during the four years immediately preceding the filing of the claim

§ 323.55 Claims. (a) Claims for abatement or refund of special taxes and ad valorem penalties erroneously or illegally assessed or collected, and claims for the redemption of special tax stamps shall be filed on Form 843 with the collector. The claim must set forth in detail and under oath each ground upon which it is made, and facts sufficient to apprise the Commissioner of the exact basis thereof. If the claim is for redemption of a special tax stamp, such stamp shall be attached to and made a part of the claim.

(b) No claim for the refund of a special tax or penalty or for the redemption of a special tax stamp shall be allowed unless presented within four years next after the payment of such tax or penalty or the purchase of such stamp.

(c) A special tax payer who for any reason discontinues business is not entitled to any refund for the unexpired portion of the fiscal year for which the special tax stamp was issued.

SEC. 3793. PENALTIES AND FORFEITURES. (b) Fraudulent returns, affidavits, and claims.

(1) Assistance in preparation or presentation. Any person who willfully aids or assists in, or procures, counsels, or advises the preparation or presentation under, or in connection with any matter arising under, the internal revenue laws, of a false or fraudulent return, affidavit, claim, or document, shall (whether or not such falsity or fraud is with the knowledge or consent of the person authorized or required to present such return, affidavit, claim, or document) be guilty of a felony, and, upon conviction thereof, be fined not more than $10,000, or imprisoned for not more than five years, or both, together with the costs of prosecution.

SEC. 35. CRIMINAL CODE OF THE UNITED STATES, AS AMENDED BY THE ACT APPROVED APRIL 4, 1938 (52 Stat. 197, 18 U.S.C., and Sup., 80, 83).

(A) Whoever shall make or cause to be made or present or cause to be presented, for payment or approval, to or by any person or officer in the civil, military, or naval service of the United States, or any department thereof, or any corporation in which the United States of America is a stockholder, any claim upon or against the Government of the United States, or any department or officer thereof, or any corporation in which the United States of America is a stock

holder, knowing such claim to be false, fictitious, or fraudulent; or whoever shall knowingly and willfully falsify or conceal or cover up by any trick, scheme, or device a material fact, or make or cause to be made any false or fraudulent statements or representations, or make or use or cause to be made or used any false bill, receipt, voucher, roll, account, claim, certificate, affidavit, or deposition, knowing the same to contain any fraudulent or fictitious statement or entry in any matter within the jurisdiction of any department or agency of the United States or of any corporation in which the United States of America is a stockholder; or whoever shall enter into any agreement, combination, or conspiracy to defraud the Government of the United States, or any department or officer

Subpart H-Miscellaneous Provisions

402.801 Jeopardy assessments. 402.802 Interest.

402.803 Addition to tax for failure to pay an assessment after notice and demand.

402.804 Additions to tax for delinquent or false returns.

402.805 Promulgation of regulations.

AUTHORITY: §§ 402.1 to 402.805, inclusive, issued under I.R.C. 1429, 53 Stat. 178; 26 U.S.C. 1429, and are generally preceded by the statutory provisions to which they, respectively, refer.

SOURCE: §§ 402.1 to 402.805, inclusive, contained in Regulations 106, Secretary of the Treasury, Feb. 24, 1940; 5 F.R. 774. Exceptions are noted in brackets following sections affected.

INTRODUCTORY

an ex

§ 402.1 Chronological description of pertinent statutes and regulations—(a) Title VIII of the Social Security Act and regulations thereunder—(1) Statutes. Title VIII of the Social Security Act, approved August 14, 1935 (49 Stat. 636; 42 U.S.C. 1001-1011), imposes cise tax on employers of one or more employees, and an income tax on employees, measured by wages paid and received after December 31, 1936, with respect to employment after such date. (Title VIII of the Social Security Act has been superseded as indicated in paragraph (b) (1).)

Section 9 (a) of the Carriers Taxing Act of 1937, approved June 29, 1937 (50 Stat. 439; 45 U.S.C. 269 (a)), excludes the services of employees and employee representatives, as defined in such Act, from employment with respect to which the taxes under such Title VIII apply.

Section 902 (f) of the Social Security Act Amendments of 1939, approved August 10, 1939 (53 Stat. 1400), provides, in part, that no tax shall be collected under such Title VIII with respect to services performed in the employ of foreign governments and certain of their instrumentalities.

Section 2 of the Act of August 11, 1939 (53 Stat. 1420), provides, in part, that no tax shall be collected under such Title VIII with respect to certain services performed in salvaging timber and clearing debris left by a hurricane.

(2) Regulations. Regulations relating to the taxes under Title VIII of the Social Security Act are set forth in:

(i) Treasury Decision 4704, approved November 5, 1936, as amended, entitled "Identification of Taxpayers under Title VIII of the Social Security Act-Assignment of Identification Numbers to Employers and Account Numbers to Employees";

(ii) Regulations 91, approved November 9, 1936, as amended, entitled "Regulations 91 Relating to the Employees' Tax and the Employers' Tax under Title VIII of the Social Security Act"; and

(iii) Treasury Decision 4739, approved May 24, 1937, making returns under Title VIII of the Social Security Act available to the Social Security Board.

(For amendments to Treasury Decision 4704, see Treasury Decision 4720, approved December 11, 1936. For amendments to Regulations 91, see Treasury Decision 4756, approved July 22, 1937; Treasury Decision 4769, approved October 15, 1937; Treasury Decision 4771, approved October 29, 1937; Treasury Decision 4778, approved November 23, 1937; Treasury Decision 4786, approved December 29, 1937; Treasury Decision 4801, approved April 28, 1938; Treasury Decision 4862, approved September 21, 1938; Treasury Decision 4934, approved September 6, 1939; and Treasury Decision 4941, approved September 20, 1939.)

(b) Federal Insurance Contributions Act and regulations thereunder-(1) Statutes. Effective April 1, 1939, the provisions of Title VIII of the Social Security Act were reenacted in the Internal Revenue Code, approved February 10, 1939, as subchapter A of chapter 9 thereof (53 Stat. 175). Such subchapter, which supersedes Title VIII of the Social Security Act, may be cited as the "Federal Insurance Contributions Act," under the authority contained in section 1432 of such subchapter, as added by section 607 of the Social Security Act Amendments of 1939 (53 Stat. 1387). The Federal Insurance Contributions Act imposes an excise tax on employers of one or more employees, and an income tax on employees, measured by wages paid and received on and after April 1, 1939, with respect to employment after December 31, 1936; except that, in the case of wages for services performed by individuals after they have attained age 65, such Act (as amended by section 905 of the Social Security Act Amendments of 1939 (53 Stat. 1400)) imposes such taxes with respect to wages paid and received after December 31, 1938, with respect to employment after such date.

Substantial changes in the provisions of the Federal Insurance Contributions Act are effected by amendments thereto contained in sections 601 to 607, inclusive, and 903 to 905, inclusive, of the Social Security Act Amendments of 1939 (53 Stat. 1381, 1400). In addition, the application of the Act is modified by section 902 (f) of the Social Security Act Amendments of 1939 (53 Stat. 1400) and by section 2 of the Act of August 11, 1939 (53 Stat. 1420), in the same manner as such sections 902 (f) and 2 modify the application of Title VIII of the Social Security Act (see paragraph (a) (1)). The applicable provisions of the Federal Insurance Contributions Act, as so amended, and the provisions making such modifications, as well as certain applicable provisions of internal revenue laws of particular importance, have been inserted in the appropriate places in, and are to be read in connection with, the regulations in this part.

(2) Regulations. The regulations contained in Treasury Decision 4704, as amended, Regulations 91, as amended, and Treasury Decision 4739 are pre

scribed under, and made applicable to, the Federal Insurance Contributions Act and other provisions of the Internal Revenue Code, by Treasury Decision 4885, approved February 11, 1939. (For amendments to Regulations 91, as so made applicable to the Internal Revenue Code, see Treasury Decision 4934, approved September 6, 1939; Treasury Decision 4935, approved September 6, 1939; and Treasury Decision 4941, approved September 20, 1939. For the extent to which Treasury Decision 4704 and Regulations 91, as so made applicable to the Internal Revenue Code, are superseded by the regulations in this part, see § 402.102. See also § 402.101, relating to the scope of the regulations in this part.)

Subpart A-Scope of Regulations

§ 402.101

Scope of regulations-(a) Taxes with respect to wages paid after 1939. The regulations in this part relate to the employees' tax and employers' tax with respect to wages paid and received on or after January 1, 1940, imposed by the Federal Insurance Contributions Act (subchapter A of chapter 9 of the Internal Revenue Code), as amended and modified by the Social Security Act Amendments of 1939 and other provisions of law. (See § 402.1 (b) (1) for a chronological description of the pertinent statutes.)

(b) Additional subjects covered—(1) Adjustments, settlements, and claims. In addition to adjustments, settlements, and claims made in connection with the taxes with respect to wages paid and received on or after January 1, 1940, the regulations in this part also relate to adjustments, settlements, and claims made on or after such date in connection with the taxes under Title VIII of the Social Security Act or under the Federal Insurance Contributions Act in force prior to January 1, 1940, with respect to wages paid and received prior to such date, but not to any adjustment reported in whole or in part on any return (except an adjustment reported by means of a supplemental return) for a tax-return period ended prior to such date.

(2) Identification of taxpayers. The regulations in this part also relate to the use after December 31, 1939, of account numbers and identification numbers as

signed to employees and employers under Title VIII of the Social Security Act or the Federal Insurance Contributions Act in force before or after the first moment of January 1, 1940, and to applications for and assignment of such numbers under the Federal Insurance Contributions Act in force after December 31, 1939.

(3) Employment. In addition to employment in the case of remuneration therefor paid and received on or after January 1, 1940, the regulations in this part also relate to employment performed on or after such date in the case of remuneration therefor paid and received prior to such date.

§ 402.102 Extent to which the regulations in this part supersede Regulations 91 and Treasury Decision 4704. The regulations in this part with respect to the subjects to which they relate, supersede:

(1) Regulations 91, approved November 9, 1936, as amended, as made applicable to the Federal Insurance Contributions Act and other provisions of the Internal Revenue Code by Treasury Decision 4885, approved February 11, 1939, together with any amendments to such regulations as so made applicable to the Internal Revenue Code; and

(2) Treasury Decision 4704, approved November 5, 1936, as amended, as made applicable to the Federal Insurance Contributions Act and other provisions of the Internal Revenue Code by such Treasury Decision 4885, together with any amendments to such Treasury Decision 4704 as so made applicable to the Internal Revenue Code.

Subpart B-Definitions

SECTION 607 OF THE SOCIAL SECURITY ACT AMENDMENTS OF 1939

FEDERAL INSURANCE CONTRIBUTIONS ACT Subchapter A of chapter 9 of the Internal Revenue Code is amended by adding at the end thereof the following new section:

SEC. 1432. This subchapter may be cited as the "Federal Insurance Contributions Act". SECTION 2 OF THE ACT OF FEBRUARY 10, 1939 (53 STAT. 1)

INTERNAL REVENUE CODE

This act and the internal revenue title incorporated herein shall be known as the Internal Revenue Code and may be cited as "I.R.C."

SECTION 1426 OF THE ACT AS AMENDED BY SECTIONS 606 AND 905 OF THE SOCIAL SECURITY ACT AMENDMENTS OF 1939

DEFINITIONS

When used in this subchapter

(a) WAGES. The term "wages" means all remuneration for employment, including the cash value of all remuneration paid in any medium other than cash; except that such term shall not include

(1) That part of the remuneration which, after remuneration equal to $3,000 has been paid to an individual by an employer with respect to employment during any calendar year, is paid to such individual by such employer with respect to employment during such calendar year;

(2) The amount of any payment made to, or on behalf of, an employee under a plan or system established by an employer which makes provision for his employees generally or for a class or classes of his employees (including any amount paid by an employer for insurance or annuities, or into a fund, to provide for any such payment), on account of (A) retirement, or (B) sickness or accident disability, or (C) medical and hospitalization expenses in connection with sickness or accident disability, or (D) death, provided the employee (1) has not the option to receive, instead of provision for such death benefit, any part of such payment or, if such death benefit is insured, any part of the premiums (or contributions to premiums) paid by his employer, and (ii) has not the right, under the provisions of the plan or system or policy of insurance providing for such death benefit, to assign such benefit, or to receive a cash consideration in lieu of such benefit either upon his withdrawal from the plan or system providing for such benefit or upon termination of such plan or system or policy of insurance or of his employment with such employer;

(3) The payment by an employer (without deduction from the remuneration of the employee) (A) of the tax imposed upon an employee under section 1400 or (B) of any payment required from an employee under a State unemployment compensation law; or

(4) Dismissal payments which the employer is not legally required to make.

(b) EMPLOYMENT. The term "employment" means any service performed prior to January 1, 1940, which was employment as defined in this section prior to such date, and any service, of whatever nature, performed after December 31, 1939, by an employee for the person employing him, irrespective of the citizenship or residence of either, (A) within the United States, or (B) on or in connection with an American vessel under a contract of service which is entered into within the United States or during the performance of which the vessel touches at a port in the United States, if the employee is employed on and in connection with such vessel when outside the United States, except

(1) Agricultural labor (as defined in subsection (h) of this section);