A bill to amend the Internal Revenue Code of 1986 to provide for employee benefits for work site employees of certain corporations operating on a cooperative basis.

Amends the Internal Revenue Code to state that employee benefit plans maintained by cooperative employing units shall be treated as single employer plans.

[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 2852 Introduced in Senate (IS)]







107th CONGRESS
  2d Session
                                S. 2852

  To amend the Internal Revenue Code of 1986 to provide for employee 
benefits for work site employees of certain corporations operating on a 
                           cooperative basis.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             August 1, 2002

Mr. Torricelli introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
  To amend the Internal Revenue Code of 1986 to provide for employee 
benefits for work site employees of certain corporations operating on a 
                           cooperative basis.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. COOPERATIVE EMPLOYING UNIT.

    (a) In General.--Section 414 of the Internal Revenue Code of 1986 
(relating to definitions and special rules) is amended by adding at the 
end the following new subsection:
    ``(w) Cooperative Employing Unit.--
            ``(1) Plans maintained by cooperative employing unit.--If a 
        cooperative employing unit establishes or maintains one or more 
        plans to provide employee benefits to work site employees, 
        then, for purposes of applying the provisions of this title 
        applicable to such benefits--
                    ``(A) each such plan shall be treated as a single 
                employer plan established and maintained by the 
                cooperative employing unit, and
                    ``(B) the cooperative employing unit shall be 
                treated as the employer of the work site employees 
                eligible to participate in each such plan.
            ``(2) Definitions.--For purposes of this subsection--
                    ``(A) Cooperative employing unit.--The term 
                `cooperative employing unit' means any corporation to 
                which part I of subchapter T applies pursuant to 
                section 1381(a) if--
                            ``(i) all the shareholders of the 
                        corporation report business operations using 
                        the same standard industrial classification 
                        code (or successor method of economic 
                        classification adopted by the Office of 
                        Management and Budget),
                            ``(ii) the corporation has at least 21 
                        shareholders, and
                            ``(iii) the corporation has entered into a 
                        written agreement with each shareholder which 
                        provides, with respect to every work site 
                        employee providing services to such 
                        shareholder, that the corporation shall--
                                    ``(I) assume responsibility for 
                                payment of wages to the work site 
                                employee,
                                    ``(II) with respect to such wages, 
                                assume responsibility for the 
                                withholding and payment of any 
                                applicable taxes under subtitle C, and 
                                for complying with the reporting 
                                requirements under this title relating 
                                to such taxes,
                                    ``(III) assume responsibility for 
                                any employee benefits provided under 
                                the agreement,
                                    ``(IV) assume shared responsibility 
                                with the shareholder for terminating 
                                the employment of the work site 
                                employee and for recruiting and hiring 
                                any new worker, and
                                    ``(V) maintain employee records 
                                relating to the work site employee.
                Clause (iii) shall be applied without regard to the 
                receipt or adequacy of payment from the shareholder for 
                services to such shareholder.
                    ``(B) Work site employee.--The term `work site 
                employee' means every individual providing services to 
                one or more shareholders of the cooperative employing 
                unit pursuant to an agreement described in paragraph 
                (2)(A)(iii) between the shareholder and the cooperative 
                employing unit.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2002.
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