§ 5520. Withholding of city or county income or employment taxes

1,885 words·~9 min read·/usc/title-5/section-5520

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)When a city or county ordinance—

(1)provides for the collection of a tax by imposing on employers generally the duty of withholding sums from the pay of employees and making returns of the sums to a designated city or county officer, department, or instrumentality; and

(2)imposes the duty to withhold generally on the payment of compensation earned within the jurisdiction of the city or county in the case of employees whose regular place of employment is within such jurisdiction;

the Secretary of the Treasury, under regulations prescribed by the President, shall enter into an agreement with the city or county within 120 days of a request for agreement by the proper city or county official. The agreement shall provide that the head of each agency of the United States shall comply with the requirements of the city or county ordinance in the case of any employee of the agency who is subject to the tax and

(i)whose regular place of Federal employment is within the jurisdiction of the city or county with which the agreement is made or

(ii)is a resident of such city or county. The agreement may not apply to pay for service as a member of the Armed Forces (other than service described in section 5517(d) of this title). The agreement may not permit withholding of a city or county tax from the pay of an employee who is not a resident of, or whose regular place of Federal employment is not within, the State in which that city or county is located unless the employee consents to the withholding.

(b)This section does not give the consent of the United States to the application of an ordinance which imposes more burdensome requirements on the United States than on other employers or which subjects the United States or its employees to a penalty or liability because of this section. An agency of the United States may not accept pay from a city or county for services performed in withholding city or county income or employment taxes from the pay of employees of the agency.

(c)For the purpose of this section—

(1)“city” means any unit of general local government which—

(A)is classified as a municipality by the Bureau of the Census, or

(B)is a town or township which, in the determination of the Secretary of the Treasury—

(i)possesses powers and performs functions comparable to those associated with municipalities,

(ii)is closely settled, and

(iii)contains within its boundaries no incorporated places, as defined by the Bureau of the Census,

within the political boundaries of which 500 or more persons are regularly employed by all agencies of the Federal Government;

(2)“county” means any unit of local general government which is classified as a county by the Bureau of the Census and within the political boundaries of which 500 or more persons are regularly employed by all agencies of the Federal Government;

(3)“ordinance” means an ordinance, order, resolution, or similar instrument which is duly adopted and approved by a city or county in accordance with the constitution and statutes of the State in which it is located and which has the force of law within such city or county; and

(4)“agency” means—

(A)an Executive agency;

(B)the judicial branch; and

(C)the United States Postal Service.

(Added Pub. L. 93–340, § 1(a), July 10, 1974, 88 Stat. 294; amended Pub. L. 94–358, § 1, July 12, 1976, 90 Stat. 910; Pub. L. 95–30, title IV, § 408(a), May 23, 1977, 91 Stat. 157; Pub. L. 95–365, § 1, Sept. 15, 1978, 92 Stat. 599; Pub. L. 100–180, div. A, title V, § 505(2), Dec. 4, 1987, 101 Stat. 1086.)