Form 2032 Form 2032 Contract Coverage Under Title II of the Social Security

Form

2032 1I

(Rev. June 2007)

Depaffment ot the Treasury
Internal Revenue Sewlee

C

Contract Coverage Under Title II
of the Social Security Act

OMB NO. 1545-0137

File three copies

(For use by an American employer t o extend social security coverage to
U.S. citizens and resident aliens employed by its foreign affiliates.)

I

Name of American employer

of this form
Employer identification number

This Form 2032 is filed as (check applicable box(es)):
1
A n original (new) agreement.
This agreement is effective for services performed on and after (for original agreements only, check one):
director signs this agreement.
a
The first day of the calendar quarter in which the
director signs this agreement.
b
The first day of the calendar quarter following the calendar quarter in which the
2
An amendment to an agreement previously entered into.
3
An election t o apply the rules in effect after April 20, 1983, to agreements in effect on that date. By making this election,
U.S. resident aliens as well as U.S. citizens will be covered by social security.

a

If this is an amended election or agreement, provide the following information:

on
(Location where ~revious
Form 2032 was filed)

(Date se&ee&+

d~rectorsisned otiqinal aqreement on Form 2032)

4 This agreement extends the Federal insurance system under Title II of the Social Security Act to certain services performed outside the
United States by U.S. citizens and resident aliens employed by any of the foreign affiliates listed below. For an amendment to an agreement
without making the election to apply the post-April 20, 1983 rules, this amendment extends Title It social security coverage to certain
services performed outside the United States by U.S. citizens employed by any of the foreign affiliates listed below.
Note. Enter foreign affiliate addresses below in the following order: city, province or state, and country. Do not abbreviate the country
name, and follow the country's practice for entering the postal code. I
this agreement includes more than four foreign affiliates, attach a
separate sheet of paper identified as part of this anreement with the name and address of each additional f o r e i ~ naffiliate.
a Name and address of foreign affiliate
c Name and address of foreign affiliate

b Name and address of foreign affiliate

d Name and address of foreign affiliate

5 Estimated number of employees to be initially covered by this agreement, amendment, or election:
Agricultural employees b
Nonagricultural employees b
This agreement applies to all services performed outside the United States by each U.S. citizen or resident alien employed by any of the foreign
affiliates named. However, the agreement applies only to the extent that payments to each employee for the sewices would be considered wages
if paid by the employer for services performed in the United States. This agreement does not apply to any service that is considered employment
for purposes of the employee tax and the employer tax under the Federal Insurance Contributions Act.
For an original agreement, an amendment to an agreement that was entered into after April 20, 1983, or an election to apply the rules in effect after
April 20, 1983, to agreements in effect on that date, the American employer declares that it owns at least a 10% interest (directly or through one or
more entities) in the voting stock or profits of each foreign entity named above. It also declares that Code section 3121 (I) does not prevent this agreement.
For an amendment to an agreement in effect on April 20, 1983, without making the election to apply the new rules in effect after that date, the
domestic corporation declares that (a) it owns at least 20% of the voting stcck af each foreign corporation named above, or (b) it owns at least
20% of the voting stock of a foreign corporation that owns more than 50% of the voting stock of each foreign corporation named above. It also
declares that Code section 3121(1) does not prevent this agreement.
The American employer agrees:
1. To pay amounts equal to the taxes that would be imposed by Code sections 3101 and 31 11 if the payment for the services were considered
wages;

2. To pay, on written notification and demand, amounts equal to the interest, additions to taxes, and penalties that would apply if the payment
for the services were considered wages; and
3. To comply with the applicable regulations under Code section 3121(1).
This agreement (or amended agreement or election) is entered into under the provisions of section 3121(1) of the Internal Revenue Code and the
applicable regulations.
Signature of individual authorizd to enter into this
agreement for the Arner~canemployer

T~tle

Director, Internal Revenue Service Center

Location

For Privacy Act and Papework Reduction Act Notice, see back of form.

Cat. No. 499540

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Date

Date

Form

2032 (Rev. 6-2007)

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Form 2032 (Rev b-2007)

hew

section
above

General Instructions

Where To File

Sectfon references dre lo the Internal Revenue

Send three copies of this form to:
lnternal Revenue Semice
Ogden, UT 84201 -0023
An American employer already filing Form 941,
Employer's Quarterly Federal Tax Return, should
file Form 2032 with the lnternal Revenue Sewice
where the employer flles Form 941 (generally
the~rprincipal place of business). For electronic
F941 filers, send Form 2032 to lnternal Revenue
Service. Cincinnati, OH 45999-0038. Enter on
Form 2032 the employer ldentlflcatlon number
(EtN) as shown on Form 941. This will help the
IRS process your form faster.

What's New
The addresses tor f~lingForm 2032 have
changed See Where To F ~ l ebelow
Before Apnl 2 1. 11383. only domestic
corporations could enter into t h ~ sagreement to

cover only U.S. cltlzens employed by forslgn
subs~dianes For t h ~ sagreement, a iorelgn
subsidiary was def~nedas a fore~gncorporatlon
In ruh~ch:
at least 20% at the votlng stock was owned
by the domest~ccorporatlon, or
Completing Form 2032
more than 50% of the votlng stack was
Complete Form 2032 in triplicate. Each copy of
owned by another fore~gncarporatlon in which
the form must be signed and dated by the
the domestic corporation owned at least 20% of
Individual authorized t o enter into the agreement,
the voting stock.
amendment, or election. Attach t o each form
After April 20, 1983, any Amcncan employer
ev~denceshowlng the authority for such
(no longer limited to a domest~ccorporation) can
Individual t o sign the form. For example,
enter into this agreement to cover U S. resident
corporations must include a certified copy of the
aliens as well as U.S. citizens employed by a
minutes of the h a r d of director's meeting.
forelgn affiliate. For this agreement, a foreign
After the director of the lnternal Revenue
affiliate is any foreign entity (no longer llmlted to
Service Center signs and dates the form, it
a foreign corporation) In which the Amer~can
constitutes the agreement, amendment, or
employer owns at least a 10% interest In the
election authorized by section 3121(I). The IRS
voting stock or profits. This interest musl be
will return one copy of Form 2032 t o the
owned directly or through one or more entitles
American employer, send one copy to the Social
A domestic corporation having an agrwment
Secur~tyAdministration, and keep one copy with
in effect that was entered into before April 21.
all related papers.
1983. can elect to apply the post-April 20, 1983,
Original sgreements. Check the box on line 1.
rules t o such agreements. If a domestic
Also check Ihe applicable box on line la or b to
corporation makes this election, social secur~ty
des~gnatewhen the agreement w ~ l take
l
ettect
coverage will be extended t o U.S, resldent allen
Amending
agreements.
You
may
amend
an
employees of any foreign subsidiarf for wh~ch
U.S. citizens are currently covered by an ex~st~ng agreement at any tlme to extend coverage to
any lore~gnaffl~atenot covered by an ex~st~ng
agreement. In addition, the election allows a
agreement. F~leForm 2032 in tripl~cate,and
domestic corporation t o extend social securrty
check lhe box on line 2. If you amend an
and Medicare coverage t o U.S. citizens and
agreement entered into on w before April 20
resident aliens employed by a foreign ent~tythat
1983, w~thoutrnak~ngthe election t o apply the
did not qualify for coverage under the old 20%
rules In kfiecl afler that date, the agreement and
ownership rules, but that now qualifies under the
amendments w~llcontinue to be governed by the
10% ownership rules.
rules In etfect before April 21. 1983.
Note. The United States has social security
(totalization) agreements with specif~cmunlr~es
Effective date. If you f ~ l ean amendment to an
These agreements ensure that soc~alsecunty
agreernent on Form 9032 to Include fore~gn
taxes are pad to only one country However,
affil~atesnot prev~ouslycovered. and IIthe
these agreements may affect the w~thhold~ng
d~rectorsigns the amendment
requirements resulting from filing Form 2032. For
dur~ngthe quarter for wh~chthe orig~nal
more information, see Social Security and
agreernent 1s tlrst effective or dur~ngthe i ~ e t
Medicare Taxes in Pub. 54,Tax Guide lor U.S
month followlng that quarter the amendment w ~ l l
Citizens and Resident Aliens Abroad.
be effectwe as of the effect~vedate of the
arqnal agreement. But ~f the arnsndmerrt is
Purpose of form. An Amer~car:enlployer uses
s~gned
by the
d~rectorafter the
this form to:
end ol the 4th month for wh~chthe or~g~nal
Enter into the agreement specified in 3121(1)
agreement IS m effect, tne amendment wull not
to extend coverage under Title II of the Social
be effectwe until the II-t day of the quarter
Security Act t o I1.S citizens and resident aliens
followlng the one In wh~ct, the
abroad by forelgn affiliates,
dlrector slgned the amendment.
Amecd a prevlous agreement, or
Election to apply post-April 20, 1983 rules. A
E!et to apply the rules in effect after April 20.
domestic corporation having an agreement In
1983, to agreements in effect on that date.
effect that was entered into before April 21,
For t h ~ sagreement, an American employer is an
1983 (old agreement), may elect to have the
employer that is:
rules in effect afier Aprll 20. 1983, apply t o the
old agreement. File Form 2032 in triplicate, and
The Unltsd States or any instrumentality
check the box on llne 3.
thereof,
If you make thls election, it will be effective for
An ~ n d ~ v ~ dwho
u a l IS a resldent of the United
all foreign entlties covered by the agreement. By
States,
making the electlon, U.S. resldent alien
A partnership if two-thlrds or more of the
employees as well as U.S. citizen employees w ~ l l
partners are residents of the United States,
be covered by the agreement.
A trust if all the trustees are residents of the
United States, or
A corporation organized under the laws of the
Unrtec States or of any state.

@

Printed on +ed

paper

Page

2

To extend coverage to any forelgn affiliate not
covered by an agreement, indicate the name and
address of the foreign affiliate on line 4 and
check the box on line 2 for lhe amended
agreement, and the box on llne 3 for the
electlon.
Effective date. Generally, the elect~onw1l1be
effective on the day follow~ngthe quarter In
which the election 1s slgnsd by lhe m
eedw director.

No Termination of Agreement
Once you enter into an agreement, you cannol
terminate it, either In its entlrely or w ~ t hrespect
t o any foreign affiliate. However, the agreement
will terminate for a foreign entlty at the end ot
any quarter in which the foreign entlty, a1 any
time ~nthat quarter, ceased t o be your fore~gn
affiliate.
Privacy Act and Papemork Reduction Act
Notice. We ask for the information on thls form
to carry out the lnternal Revenue laws of the
United States. We need ~tto f~gureand collect
the right amount of lax. Sect~on61 09 reqtrlres
you to provide your taxpayer ~denI~f!cstion
number (SSN or EIN) Section 3121 of the
lnternal Revenue Code allows employees of
foreign affiliates to be cove& under social
security. Rout~neuses of t h ~ s~nforrnat~on
Include
givlng it t o the Social Security Adrn~n~strat~on
lor
use in calculating social secur~tybenefits, the
Oepartment of Justlce for civil and crlrn~nal
litigation, and cities, states and the District of
Columbia for use in administering their tax laws.
We may also disclose this infomatlon t o Federal
and state agencies to enforce Federal nontax
criminal laws and to combat terrorism. We may
also give the information t o foreign countries
under tax treaties. If you want t h ~ scoverage, you
are required to give us this information. If you fail
to provide this inforrnation in a timely manner, or
you provide incorrect or fraudulent information,
you may be denied this coverage and you may
be liable for penalties and ~nterest.
You are not requlred to provlde the
information requested on a forrr that is subject
to the Paperwork Reduction Act unless the form
displays a valid OMB control number. Books or
records relating t o a form or its instructions must
be retained as long as their contents may
become material in the administration of any
lnternal Revenue law. Generally, tax returns and
retum inforrnation are confidential, as required
by Code section 6103.
The time needed to complete and file this form
w ~ l vary
l
depend~ngon indiv~dualcircumstances.
The estimated average time is: Recordkeeping,
2 hr., 9 min.; Learning about the law or the
form, 35 min.; Preparing and sending the form
to the IRS, 39 min. If you have comments
concerning the accuracy of these time estimates
or suggestions for making this form simpler, we
would be happy t o hear from you. You can write
to: Internal Revenue Service, Tax Products
Coordinating Committee, 5E:W:CAR:MP:T:T:SP.
1111 Constttution Ave. NW, lR-6406,
Washington, OC 20224. EQ not send this form to
thus address. Instead, see Where To File above.

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