A bill to amend section 3401 of the Internal Revenue Code.

Provides an exception under the Internal Revenue Code of 1954 for income tax withholding purposes for any remuneration paid to or on behalf of an employee or his beneficiary under or to an annuity plan, which at the time of such payment is a plan purchased by tax exempt organizations or funds organized for religious, charitable, scientific, literary, or educational purposes, or educational purposes, or by public schools. (Adds 26 U.S.C. 3401 (a) (12) (D))