100 STAT. 2506
PUBLIC LAW 99-514—OCT. 22, 1986 •*{> '
ing: ", or (9) under a cafeteria plan (within the meaning of section 125 of the Internal Revenue Code of 1986)".
(e) SPECIAL RULES FOR CONTROLLED GROUPS, ETC.—
(1) IN GENERAL.—Section 414 is amended by adding at the^ end thereof the following new subsection: "(t) APPLICATION OF CONTROLLED GROUP RULES TO CERTAIN EMPLOYEE BENEFITS.—
"(1) IN GENERAL.—All employees who are treated as employed by a single employer under subsection (b), (c), or (m) of section 414 shall be treated as employed by a single employer for purposes of an applicable section. The provisions of subsection (o) of section 414 shall apply with respect to the requirements of an applicable section. "(2) APPLICABLE SECTION.—For purposes of this subsection, the term 'applicable section' means section 79, 89, 106, 117(d), 120, 125, 127,129, 132, 274(j), or 505." (2) CONFORMING AMENDMENTS.—
(A) Section 132(g) (relating to special rules relating to employer) is amended to read as follows: "(g) RECIPROCAL AGREEMENTS.—For purposes of paragraph (1) of
subsection (a), any service provided by an employer to an employee of another employer shall be treated as provided by the employer of such employee if— "(1) such service is provided pursuant to a written agreement between such employers, and "(2) neither of such employers incurs any substantial additional costs (including foregone revenue) in providing such service or pursuant to such agreement." ,^ (B) Paragraph (4) of section 505(b) (relating to aggregation rules) is amended to read as follows: "(4) AGGREGATION RULES.—At the election of the employer, 2
or more plans of such employer may be treated as 1 plan for purposes of this subsection." (f) BENEFITS TEST FOR DEPENDENT CARE ASSISTANCE PROGRAMS.—
Section 129(d) (relating to dependent care assistance program) is amended by adding at the end thereof the following new paragraph: "(8) BENEFITS.—
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"(A) IN GENERAL.—A plan meets the requirements of this paragraph if the average benefits provided to employees who are not highly compensated employees is at least 55 percent of the average benefits provided to highly compensated employees. "(B) SALARY REDUCTION AGREEMENTS.—For purposes of subparagraph (A), in the case of any benefits provided through a salary reduction agreement, there shall be disregarded any employees whose compensation (within the meaning of section 415(q)(7)) is less than $25,000."
(g) DEFINITION OF EXCLUDABLE EMPLOYEE.—
(1) Section 120(c)(2) is amended by striking out the last sentence thereof and inserting in lieu thereof "For purposes of this paragraph, there may be excluded from consideration employees who may be excluded from consideration under section 89(h)." c (2) Section 117(d) is amended by adding at the end thereof the following new paragraph: "(4) EXCLUSION OF CERTAIN EMPLOYEES.—For purposes of this subsection, there may be excluded from consideration
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