(a) Deductions because of individual's activity--(1) Prior to May 1983. For months prior to May 1983, a 7-day work test applies in a month before benefit deductions are made for noncovered remunerative activity outside the United States. A deduction is made from any monthly benefit (except disability insurance benefits, child's insurance benefits based on the child's disability, or widow's or widower's insurance benefits based on the widow's or widower's disability) payable to an individual for each month in a taxable year beginning after December 1954 in which the beneficiary, while under age 72 (age 70 after December 1982), engages in noncovered remunerative activity (see Sec. 404.418) outside the United States on 7 or more different calendar days. The deduction is for an amount equal to the benefit payable to the individual for that month.
(1) Prior to May 1983. For months prior to May 1983, a 7-day work test applies in a month before benefit deductions are made for noncovered remunerative activity outside the United States. A deduction is made from any monthly benefit (except disability insurance benefits, child's insurance benefits based on the child's disability, or widow's or widower's insurance benefits based on the widow's or widower's disability) payable to an individual for each month in a taxable year beginning after December 1954 in which the beneficiary, while under age 72 (age 70 after December 1982), engages in noncovered remunerative activity (see Sec. 404.418) outside the United States on 7 or more different calendar days. The deduction is for an amount equal to the benefit payable to the individual for that month.
(2) From May 1983 on. Effective May 1983, a 45-hour work test applies before a benefit deduction is made for the non-covered remunerative activity performed outside the United States in a month by the type of beneficiary described in paragraph (a)(1) of this section.
(b) Deductions from benefits because of the earnings or work of an insured individual--(1) Prior to September 1984. Where the insured individual entitled to old-age benefits works on 7 or more days in a month prior to September 1984 while under age 72 (age 70 after December 1982), a deduction is made for that month from any:
(1) Prior to September 1984. Where the insured individual entitled to old-age benefits works on 7 or more days in a month prior to September 1984 while under age 72 (age 70 after December 1982), a deduction is made for that month from any:
(i) Wife's, husband's, or child's insurance benefit payable on the insured individual's earnings record; and
(ii) Mother's, father's, or child's insurance benefit based on child's disability, which under Sec. 404.420 is deemed payable on the insured individual's earnings record because of the beneficiary's marriage to the insured individual.
(2) From September 1984 on. Effective September 1984, a benefit deduction is made for a month from the benefits described in paragraph (b)(1) of this section only if the insured individual, while under age 70, has worked in excess of 45 hours in that month.
(3) Amount of deduction. The amount of the deduction required by this paragraph (b) is equal to the wife's, husband's or child's benefit.
(4) From January 1985 on. Effective January 1985, no deduction will be made from the benefits payable to a divorced wife or a divorced husband who has been divorced from the insured individual for at least 2 years. [49 FR 24117, June 12, 1984, as amended at 51 FR 11912, Apr. 21, 1986; 52 FR 26145, July 13, 1987] Sec. 404.418 ``Noncovered remunerative activity outside the United States,'' defined.
An individual is engaged in noncovered remunerative activity outside the United States for purposes of deductions described in Sec. 404.417 if:
(a) He performs services outside the United States as an employee and the services do not constitute employment as defined in subpart K of this part and, for taxable years ending after 1955, the services are not performed in the active military or naval service of the United States; or
(b) He carries on a trade or business outside the United States (other than the performance of services as an employee) the net income or loss of which is not includable in computing his net earnings from self-employment (as defined in Sec. 404.1050) for a taxable year and would not be excluded from net earnings from self-employment (see Sec. 404.1052) if the trade or business were carried on in the United States. When used in the preceding sentence with respect to a trade or business, the term United States does not include the Commonwealth of Puerto Rico, the Virgin Islands and, with respect to taxable years beginning after 1960, Guam or American Samoa, in the case of an alien who is not a resident of the United States (including the Commonwealth of Puerto Rico, the Virgin Islands and, with respect to taxable years beginning after 1960, Guam and American Samoa), and the term trade or business shall have the same meaning as when used in section 162 of the Internal Revenue Code of 1954.