12 2 STA T . 1 6 2 9PUBLIC LA W 11 0– 2 45—J U NE 1 7, 200 8par a g rap h(1) ( C ) by r e a son o f any c on t r i b u tion or ben - efit w hich is base d on the differentia l wage pay m ent .‘ ‘( B ) SPECIALRU LE FO R D I ST RI B UTIO N S. — ‘‘(i) I N G ENERAL.— N otwithstanding subparagraph ( A )(i) , for purposes of section 40 1( k )( 2 )(B)(i)(I), 40 3 (b)( 7 )(A)(ii), 403(b)(11)(A), or 4 5 7(d)(1)(A)(ii), an indi v idual shall be treated as having been severed from employment during any period the individual is performing service in the uniformed services described in section 3401(h)(2)(A). ‘‘(ii) L I M ITATION.—If an individual elects to receive a distribution by reason of clause (i), the plan shall provide that the individual may not make an elective deferral or employee contribution during the 6 -month period beginning on the date of the distribution. ‘‘(C) NONDISCRIMINATION RE Q UIREMENT.—Subpara- graph (A)(iii) shall apply only if all employees of an employer (as determined under subsections (b), (c), (m), and (o)) performing service in the uniformed services described in section 3401(h)(2)(A) are entitled to receive differential wage payments on reasonably e q uivalent terms and, if eligible to participate in a retirement plan main- tained by the employer, to make contributions based on the payments on reasonably equivalent terms. F or purposes of applying this subparagraph, the provisions of paragraphs (3), (4), and (5) of section 410(b) shall apply. ‘‘( D ) DIFFERENTIAL W AGE PA Y MENT.—For purposes of this paragraph, the term ‘differential wage payment ’ has the meaning given such term by section 3401(h)(2).’’. (B) CONFORMING AMENDMENT.— T he heading for sec- tion 414(u) is amended by inserting ‘‘AND TO DIFFERENTIAL W AGE P AYMENTS TO M EMBERS ON ACTI V E DUTY’’ after ‘‘ U S ER RA’’. (2) DIFFERENTIAL WAGE PAYMENTS TREATED AS COMPENSA- TION FOR INDIVIDUAL RETIREMENT PLANS.—Section 21 9 (f)(1) (defining compensation) is amended by adding at the end the following new sentence
‘‘The term compensation includes any differential wage payment (as defined in section 3401(h)(2)).’’. (3) EFFECTIVE DATE.—The amendments made by this sub- section shall apply to years beginning after December 31, 200 8 . (c) PROVISIONS RELATING TO PLAN AMENDMENTS.— (1) IN GENERAL.—If this subsection applies to any plan or annuity contract amendment, such plan or contract shall be treated as being operated in accordance with the terms of the plan or contract during the period described in paragraph (2)(B)(i). (2) AMENDMENTS TO W H ICH SECTION APPLIES.— (A) IN GENERAL.—This subsection shall apply to any amendment to any plan or annuity contract which is made— (i) pursuant to any amendment made by subsection (b)(1), and (ii) on or before the last day of the first plan year beginning on or after J anuary 1, 2010. 26USC41 4 note. 26 USC 21 9 note. 26 USC 414. Ap p licab ilit y .
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