PUBLIC LAW 105-34—AUG. 5, 1997 111 STAT. 1067 SEC. 1507. MODIFICATION OF 10-PERCENT TAX FOR NONDEDUCTIBLE CONTRIBUTIONS. (a) IN GENERAL.—Section 4972(c)(6)(B) (relating to exceptions) is amended to read as follows: "(B) so much of the contributions to 1 or more defined contribution plans which are not deductible when contributed solely because of section 404(a)(7) as does not exceed the greater of— "(i) the amount of contributions not in excess of 6 percent of compensation (within the meaning of section 404(a)) paid or accrued (during the taxable year for which the contributions were made) to beneficiaries under the plans, or "(ii) the sum of— "(I) the amount of contributions described in section 401(m)(4)(A), plus "(II) the amount of contributions described in section 402(g)(3)(A).". (b) EFFECTIVE DATE. —The amendments made by this section 26 USC 4972 shall apply to taxable years beginning after December 31, 1997. note. SEC. 1508. MODIFICATION OF FUNDING REQUIREMENTS FOR CERTAIN PLANS. (a) FUNDING RULES FOR CERTAIN PLANS.— Section 769 of the Retirement Protection Act of 1994 is amended by adding at the 26 USC 412 note. end the following new subsection: "(c) TRANSITION RULES FOR CERTAIN PLANS.— Appiicabiuty. "(1) IN GENERAL.—In the case of a plan that— "(A) was not required to pay a variable rate premium for the plan year beginning in 1996; "(B) has not, in any plan year beginning after 1995 and before 2009, merged with another plan (other than a plan sponsored by an employer that was in 1996 within the controlled group of the plan sponsor); and "(C) is sponsored by a company that is engaged primarily in the interurban or interstate passenger bus service, the transition rules described in paragraph (2) shall apply for any plan year beginning after 1996 and before 2010. "(2) TRANSITION RULES. — The transition rules described in this paragraph are as follows: "(A) For purposes of section 412(1)(9)(A) of the Internal Revenue Code of 1986 and section 302(d)(9)(A) of the Employee Retirement Income Security Act of 1974— "(i) the funded current liability percentage for any plan year beginning after 1996 and before 2005 shall be treated as not less than 90 percent if for such plan year the funded current liability percentage is at least 85 percent, and "(ii) the funded current liability percentage for any plan year beginning after 2004 and before 2010 shall be treated as not less than 90 percent if for such plan year the funded current liability percentage satisfies the minimum percentage determined according to the following table:
�
