[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: 26CFR31.3231(e)-1]

[Page 148-149]
 
                       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 C_Railroad Retirement Tax Act (Chapter 22, Internal Revenue Code 
                                of 1954)
 
Sec. 31.3231(e)-1  Compensation.

    (a) Definition--(1) The term compensation has the same meaning as 
the term wages in section 3121(a), determined without regard to section 
3121(b)(9), except as specifically limited by the Railroad Retirement 
Tax Act (chapter 22 of the Internal Revenue Code) or regulation. The 
Commissioner may provide any additional guidance that may be necessary 
or appropriate in applying the definitions of sections 3121(a) and 
3231(e).
    (2) A payment made by an employer to an individual through the 
employer's payroll is presumed, in the absence of evidence to the 
contrary, to be compensation for services rendered as an employee of the 
employer. Likewise, a payment made by an employee organization to an 
employee representative through the organization's payroll is

[[Page 149]]

presumed, in the absence of evidence to the contrary, to be compensation 
for services rendered by the employee representative as such. For rules 
regarding the treatment of deductions by an employer from remuneration 
of an employee, see Sec. 31.3123-1.
    (3) The term compensation is not confined to amounts paid for active 
service, but includes amounts paid for an identifiable period during 
which the employee is absent from the active service of the employer 
and, in the case of an employee representative, amounts paid for an 
identifiable period during which the employee representative is absent 
from the active service of the employee organization.
    (4) Compensation includes amounts paid to an employee for loss of 
earnings during an identifiable period as the result of the displacement 
of the employee to a less remunerative position or occupation as well as 
pay for time lost.
    (5) For rules regarding the treatment of reimbursement and other 
expense allowance amounts, see Sec. 31.3121(a)-3. For rules regarding 
the inclusion of fringe benefits in compensation, see Sec. 31.3121(a)-
1T.
    (6) Split-dollar life insurance arrangements. See Sec. Sec. 1.61-22 
and 1.7872-15 of this chapter for rules relating to the treatment of 
split-dollar life insurance arrangements.
    (b) Special Rules. (1) If the amount of compensation earned in any 
calendar month by an individual as an employee in the service of a local 
lodge or division of a railway-labor-organization employer is less than 
$25, the amount is disregarded for purposes of determining the employee 
tax under section 3201 and the employer tax under section 3221.
    (2) Compensation for service as a delegate to a national or 
international convention of a railway-labor-organization employer is 
disregarded for purposes of determining the employee tax under section 
3201 and the employer tax under section 3221 if the individual rendering 
the service has not previously rendered service, other than as a 
delegate, which may be included in the individual's years of service for 
purposes of the Railroad Retirement Act.
    (3) For special provisions relating to the compensation of certain 
general chairs or assistant general chairs of a general committee of a 
railway-labor-organization employer, see paragraph (c)(3) of Sec. 
31.3231(b)-1.

[T.D. 8582, 59 FR 66191, Dec. 23, 1994, as amended by T.D. 9092, 68 FR 
54361, Sept. 17, 2003]