Page:United States Statutes at Large Volume 102 Part 4.djvu/493

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PUBLIC LAW 100-000—MMMM. DD, 1988

PUBLIC LAW 100-647—NOV. 10, 1988

102 STAT. 3463

that the requirements of subparagraph (A)(iii) have been met with respect to such contributions." (5) Section 408(d) of the 1986 Code (relating to tax treatment of distributions) is amended by adding at the end thereof the following new paragraph: "(7) SPECIAL RULES FOR SIMPLIFIED EMPLOYEE PENSIONS.— "(A) TRANSFER OR ROLLOVER OF CONTRIBUTIONS PROHIBITED UNTIL DEFERRAL TEST MET.—Notwithstanding any other

provision of this subsection or section 72(t), paragraph (1) and section 72(t)(l) shall apply to the transfer or distribution from a simplified employee pension of any contribution under a salary reduction arrangement described in subsection (k)(6) (or any income allocable thereto) before a determination as to whether the requirements of subsection (k)(6)(A)(iii) are met with respect to such contribution. "(B) (JERTAIN EXCLUSIONS TREATED AS DEDUCTIONS.—For purposes of paragraphs (4) and (5) and section 4973, any amount excludable or excluded from gross income under section 402(h) shall be treated as an amount allowable or allowed as a deduction under section 219." (6) Subparagraph (C) of section 404(h)(l) of the 1986 Code is amended by inserting "(or during the taxable year in the case of a taxable year described in subparagraph (A)(ii))" after "taxable year" the second place it appears. (7) Section 1108(h) of the Reform Act is amended to read as 26 USC 219 note. follows: "(h) EFFECTIVE DATES.—

"(1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this section shall apply to years b ^ i n ning after December 31, 1986. "(2) INTEGRATION RULES.—Subparagraphs (D) and (E) of section 408(k)(3) of the Internal Revenue Code of 1954 (as in effect before the amendments made by this section) shall continue to apply for years beginning after December 31, 1986, and before January 1, 1989, except that employer contributions under an arrangement under section 408(k)(6) of the Internal Revenue Code of 1986 (as added by this section) may not be int^rated under such subparagraphs." (8) Section 209(e)(8) of the Social Security Act is amended to 42 USC 409. read as follows: "(8) under a simplified employee pension (as defined in section 408(k)(l) of such Code), other than any contributions described in section 408(k)(6) of such Code,". (9) Section 3401(a)(12XC) of the 1986 Code is amended— (A) by striking out "section 219" and inserting in lieu thereof "section 402(h)(1) and (2)", and (B) by striking out "a deduction" and inserting in lieu thereof "an exclusion". (10) Section 408(k)(8) of the 1986 Code is amended by inserting ", except that in the case of years beginning after 1988, the $200,000 amount (as so adjusted) shall not exceed the amount in effect under section 401(a)(17)" after "section 415(d)". (g) AMENDMENTS RELATED TO SECTION 1111 OF THE REFORM ACT.—

dXA) Section 40iaX2XB) of the 1986 Code (defining contribution percentages) is amended by inserting "by the employer" after "contributed" each place it appears.