[Code of Federal Regulations]
[Title 26, Volume 15]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR31.3121(b)(10)-2]

[Page 59-60]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 31_EMPLOYMENT TAXES AND COLLECTION OF INCOME TAX AT SOURCE--Table of Contents
 
  Subpart B_Federal Insurance Contributions Act (Chapter 21, Internal 
                          Revenue Code of 1954)
 
Sec. 31.3121(b)(10)-2  Services performed by certain students in the 

employ of a school, college, or university, or of a nonprofit organization 
auxiliary to a school, college, or university.

    (a) (1) Services performed in the employ of a school, college, or 
university (whether or not such organization is exempt from income tax) 
are excepted from employment, if the services are performed by a student 
who is enrolled and is regularly attending classes at such school, 
college, or university.

[[Page 60]]

    (2) Services performed after 1972 in the employ of an organization 
which is--
    (i) Described in section 509(a)(3) and Sec. 1.509(a)-4;
    (ii) Organized, and at all times thereafter operated, exclusively 
for the benefit of, to perform the functions of, or to carry out the 
purposes of a school, college, or university; and
    (iii) Operated, supervised, or controlled by or in connection with 
such school, college, or university;

are excepted from employment, if the services are performed by a student 
who is enrolled and is regularly attending classes at such school, 
college, or university. The preceding sentence shall not apply to 
services performed in the employ of a school, college, or university of 
a State or a political subdivision thereof by a student referred to in 
section 218(c)(5) of the Social Security Act (42 U.S.C. 418(c)(5)) if 
such services are covered under the agreement between the Secretary of 
Health, Education, and Welfare and such State entered into pursuant to 
section 218 of such Act. For the definitions of ``operated, supervised, 
or controlled by'', ``supervised or controlled in connection with'', and 
``operated in connection with'', see paragraphs (g), (h), and (i), 
respectively, of Sec. 1.509(a)-4.
    (b) For purposes of this exception, the amount of remuneration for 
services performed by the employee in the calendar quarter, the type of 
services performed by the employee, and the place where the services are 
performed are immaterial. The statutory tests are (1) the character of 
the organization in the employ of which the services are performed as a 
school, college, or university, or as an organization described in 
paragraph (a)(2) of this section, and (2) the status of the employee as 
a student enrolled and regularly attending classes at the school, 
college, or university by which he is employed or with which his 
employer is affiliated.
    (c) The status of the employee as a student performing the services 
shall be determined on the basis of the relationship of such employee 
with the organization for which the services are performed. An employee 
who performs services in the employ of a school, college, or university, 
as an incident to and for the purpose of pursuing a course of study at 
such school, college, or university has the status of a student in the 
performance of such services. An employee who performs services in the 
employ of an organization described in paragraph (a)(2) of this section, 
as an incident to and for the purpose of pursuing a course of study at a 
school, college, or university with which such organization is 
affiliated, has the status of a student in the performance of such 
services.
    (d) The term ``school, college, or university'' within the meaning 
of this exception is to be taken in its commonly or generally accepted 
sense.
    (e) For provisions relating to domestic service performed by a 
student in a local college club, or local chapter of a college 
fraternity or sorority, see Sec. 31.3121(b)(2)-1.

[T.D. 6516, 25 FR 13032, Dec. 20, 1960; 25 FR 14021, Dec. 31, 1960, as 
amended by T.D. 7373, 40 FR 30958, July 24, 1975]