# SSR 70-11: SSR 70-11: SECTION 209(h). -- WAGES -- CASH REMUNERATION FOR AGRICULTURAL LABOR -- UNITED STATES SAVINGS BONDS, SERIES E

> Federal · Rulings · In force

URL: https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_70_11

## Section

- **Citation:** SSR 70-11
- **Heading:** SSR 70-11: SECTION 209(h). -- WAGES -- CASH REMUNERATION FOR AGRICULTURAL LABOR -- UNITED STATES SAVINGS BONDS, SERIES E
- **Jurisdiction:** Federal
- **Kind:** Rulings
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** Social Security Rulings / OASI / Definition of Wages / SSR 70-11

## Text

20 CFR 404.1027(i)

SSR 70-11

L performed agricultural services on a ranch for a number of years until
her employer's death in September 1966. She and her employer had agreed
that her wages would be $500 a year. In payment of her wages, the employer
at times purchased a United States Savings Bond, Series E, and gave it to
her. A statement signed by the president of the local bank listed 18
United States Savings Bonds, Series E, by number, issue date and
registration in L's possession.

A question has been raised whether the United States Savings Bonds
received by L from the employer, represent cash remuneration for
agricultural labor within the meaning of section 209(h) of the Social
Security Act and Regulations No. 4 of the Social Security Administration,
section 404.1027(i) (20 CFR 404.1027(i)), and thus creditable as wages for
social security benefit purposes.

Section 209(h) of the Social Security Act provides, as pertinent here,
that the term "wages" means remuneration paid after 1950 for employment
but does not include remuneration paid in any medium other than cash for
agricultural labor. Section 404.1027(i) of Regulations No. 4 reads in part
as follows: ". . . cash remuneration includes checks and other monetary
media of exchange."

The facts show that all the listed bonds were purchased for $375 each and
had a face value of $500 each, except four bonds issued in 1966 which were
purchased for $75 each and had a face value of $100 each. All but three of
the bonds were registered in L's name alone; two of the three were
registered in both L's name and that of her employer; the other bond was
registered in L's name payable on death to a named beneficiary.
nds were purchased for $375 each and
had a face value of $500 each, except four bonds issued in 1966 which were
purchased for $75 each and had a face value of $100 each. All but three of
the bonds were registered in L's name alone; two of the three were
registered in both L's name and that of her employer; the other bond was
registered in L's name payable on death to a named beneficiary.

Pursuant to applicable regulations of the Treasury Department (31 CFR
315.7) provision is made for three forms of Federal savings bond
registration -- single owner, co-ownership, and beneficiary payable on
death of owner. Thus, registration of the bonds in L's name alone made her
the single owner of such bonds. Registration of the two bonds in the name
of L's employer and herself made them co-owners as the bonds could have
been redeemed by either without the consent of the other, but since they
were in L's sole possession, only she could in fact have redeemed them. In
any event, on the death of her employer, L became sole owner. The bond
registered to L, payable on death to a named beneficiary, indicates that
she was the owner of the bond with the sole right to redeem it, and that
payment would have been made to the named beneficiary only after L's
death.

Treasury regulations further provide that payment of a Federal savings
bond will be made to the person entitled thereto upon the surrender of the
bond with an appropriate request for payment. Such payment will be made
without regard to any notice of adverse claims to a bond and no stoppage
will be entered against payment in accordance with the registration. A
Series E bond will be redeemed for 75 percent of its face value with
interest at any time on or after the first day of the second month after
the month of issue. [1]
of the
bond with an appropriate request for payment. Such payment will be made
without regard to any notice of adverse claims to a bond and no stoppage
will be entered against payment in accordance with the registration. A
Series E bond will be redeemed for 75 percent of its face value with
interest at any time on or after the first day of the second month after
the month of issue. [1]

Section 404.1027(i) of Regulations No. 4 cited, supra, defines cash
remuneration to include checks and other monetary media of exchange. It is
reasonable also to include within this concept United States Savings Bonds
which are redeemable in cash in full on request, even though after a
specified date.

Having determined that the U.S. Savings Bonds constitute cash
remuneration in the instant case, two related questions remain for
resolution, (1) bearing in mind that they are not instantly redeemable,
what is the date they may first be considered cash remuneration, and (2)
taking into consideration the difference between the face value of the
bond and its conversion value at any point short of redemption, how is the
amount of the wage payment to be figured.

L could not have redeemed any bond until the first day of the second
month following the month of issue. Therefore a bond given to her
constitutes cash remuneration for agricultural labor only on such first
day. Further, only 75 percent of the face value of each bond can be deemed
cash remuneration (regardless of any interest paid at redemption) since
that was the amount of cash L was able to receive when the bond was first
redeemable and consequently became cash remuneration to her.
issue. Therefore a bond given to her
constitutes cash remuneration for agricultural labor only on such first
day. Further, only 75 percent of the face value of each bond can be deemed
cash remuneration (regardless of any interest paid at redemption) since
that was the amount of cash L was able to receive when the bond was first
redeemable and consequently became cash remuneration to her.

Accordingly, it is held that United States Savings Bonds, Series E,
purchased by L's employer, who registered them in L's name either as
single owner, co-owner, or owner with a named beneficiary, and gave sole
possession of them to L for services rendered on the employer's ranch,
constitute cash remuneration for agricultural labor within the meaning of
section 209(h) of the Social Security Act and regulations promulgated
thereunder, and are thus creditable as her wages for employment.

[1] See in this regard 31 C.F.R.
315.35(a) and (b); also, 31 C.F.R. 315.55, 316.60, and 316.65; 316.10(a)
and (b) and Appendix Tables.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_70_11. Check the current official text before relying on it. Not legal advice.