PUBLIC LAW 109–280—AUG. 17, 2006
120 STAT. 1045
requirements of section 204(b)(5)(B)(i), the plan shall be treated as meeting the requirements of clause (i) with respect to any plan year if each participant receives pay credit for the year which is not less than the percentage of compensation determined in accordance with the following table: ‘‘If the participant’s age as of the beginning of the year is—
The percentage is— 30 or less ................................................................................ 2 Over 30 but less than 40 ....................................................... 4 40 or over but less than 50 ................................................... 6 50 or over ............................................................................... 8.
‘‘(iv) YEARS OF SERVICE.—For purposes of this subparagraph, years of service shall be determined under the rules of paragraphs (1), (2), and (3) of section 203(b), except that the plan may not disregard any year of service because of a participant making, or failing to make, any elective deferral with respect to the qualified cash or deferred arrangement to which subparagraph (C) applies. ‘‘(C) CONTRIBUTION REQUIREMENTS.— ‘‘(i) IN GENERAL.—The contribution requirements of this subparagraph with respect to any applicable individual account plan forming part of an eligible combined plan are met if— ‘‘(I) the qualified cash or deferred arrangement included in such plan constitutes an automatic contribution arrangement, and ‘‘(II) the employer is required to make matching contributions on behalf of each employee eligible to participate in the arrangement in an amount equal to 50 percent of the elective contributions of the employee to the extent such elective contributions do not exceed 4 percent of compensation. Rules similar to the rules of clauses (ii) and (iii) of section 401(k)(12)(B) of the Internal Revenue Code of 1986 shall apply for purposes of this clause. ‘‘(ii) NONELECTIVE CONTRIBUTIONS.—An applicable individual account plan shall not be treated as failing to meet the requirements of clause (i) because the employer makes nonelective contributions under the plan but such contributions shall not be taken into account in determining whether the requirements of clause (i)(II) are met. ‘‘(D) VESTING REQUIREMENTS.—The vesting requirements of this subparagraph are met if— ‘‘(i) in the case of a defined benefit plan forming part of an eligible combined plan an employee who has completed at least 3 years of service has a nonforfeitable right to 100 percent of the employee’s accrued benefit under the plan derived from employer contributions, and ‘‘(ii) in the case of an applicable individual account plan forming part of eligible combined plan—
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