Rev. Rul. 55-470

Advice has been requested whether foreign and home mission boards sponsored by a particular religious organization may be considered separate autonomous entities for purposes of waiving exemption from the taxes imposed under the Federal Insurance Contributions Act (subchapter A, chapter 9, Internal Revenue Code of 1939) as provided by section 1426(1) of the Act.

In the instant case, a religious organization engages persons to serve on the home and foreign mission boards which it operates. It has filed a waiver of exemption certificate (Form SS-15) pursuant to section 1426(1) of the Act certifying that it desires to have the insurance system established by Title II of the Social Security Act extended to services performed by its employees. However, in filing such certificate, only employees in the organization's home office were considered to be eligible for coverage under the Act and were listed on the accompanying Form SS-15a.

Section 1426(1) of the Act relating to the exemption of religious, charitable, etc., organizations provides, in part, that an organization exempt from income tax under section 101(6) of the Internal Revenue Code of 1939 may file a certificate certifying that it desires to have the insurance system established by Title II of the Social Security Act extended to services performed by its employees and that at least two-thirds of its employees concur in the filing of the certificate. Such certificate may be filed only if it is accompanied by a list containing the signature, address, and social security account number (if any) of each employee who concurs in the filing of the certificate.

Although the home and foreign staffs of the instant organization operate on separate budgets and the qualifications respecting the employment and remuneration of their personnel may vary, the ultimate control over employees on the staffs of foreign missions is vested in the organization in the United States and the foreign missions are not separate entities, but are in effect branches or departments of the home (United States) missions or offices.

Since the organization in this case is an organization exempt from Federal income taxes under section 101(6) of the Internal Revenue Code which desires to have the insurance system established by Title II of the Social Security Act extended to services performed by its employees, it must have obtained the concurring signatures of at least two-thirds of the total number of all its employees (including foreign as well as home employees) computed at the time of filing. See T.D. 5823, C.B. 1951-1, 89. In the absence of meeting this requirement, social security coverage may not be extended to its employees. However, if it can meet the conditions specified by section 3121(k) of the Internal Revenue Code of 1954, as amended by the Social Security Amendments of 1954, social security coverage may be available for certain periods of such services