PUBLIC LAW 98-369—JULY 18, 1984
98 STAT. 957
(2) DEFINITION OF REQUIRED PRINCIPAL PAYMENT.—Subpara-
graph (C) of section 236(c)(2) of the Tax Equity and Fiscal Responsibility Act of 1982 is amended by inserting before the 26 USC 72 note. period at the end thereof the following: "or if such loan was payable on demand". (3) REPEAL OF PROVISION TREATING CERTAIN LOAN REPAYMENTS
AS CONTRIBUTIONS.—Subsection (f) of section 404 (relating to 26 USC 404. certain loan repayments considered as contributions) is hereby repealed. (4) CLARIFICATION OF EXCEPTION FOR SMALL LOANS.—Clause (ii)
of section 72(p)(2)(A) (relating to exception for certain loans) is amended to read as follows: "(ii) the greater of (I) one-half of the present value of the nonforfeitable accrued benefit of the employee under the plan, or (II) $10,000." (c) AMENDMENTS RELATED TO SECTION 237.—
26 USC 72.
(1) AMENDMENTS CONFORMING TO LIMITING TO KEY EMPLOYEES THE PENALTY FOR PREMATURE DISTRIBUTIONS.—
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(A) Clause (i) of section 72(m)(5)(A) is amended by striking out "as an owner-employee" and inserting in lieu thereof "as a key employee". (B) The paragraph heading of section 72(m)(5) is amended by striking out "OWNER-EMPLOYEES" and inserting in lieu
I
thereof "KEY EMPLOYEES".
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(C) Sections 46(a)(4), 53(a), and 901(a) are each amended Ante, p. 834, 838. by striking out "tax on premature distributions to owner- 26 USC 901. employees" and inserting in lieu thereof "tax on premature distributions to key employees".
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(2) CORRECTION OF CROSS REFERENCE TO DEFINITION OF BANK.—
(A) Subsection (f) of section 401 is amended by striking out "(as defined in subsection (d)(D)" and inserting in lieu thereof "(as defined in section 408(n))". (B) Subsection (h) of section 408 is amended by striking out "(as defined in section 401(d)(1))" and inserting in lieu thereof "(as defined in subsection (n))".
26 USC 401. 26 USC 408.
(3) LIMITATION ON ROLLOVERS TO APPLY ONLY TO KEY EMPLOY-
EES.—Clause (ii) of section 402(a)(5)(E) (relating to self-employed Ante, p. 869. i individuals and owner-employees) is amended to read as follows: "(ii) KEY EMPLOYEES.—An eligible retirement plan described in subclause (IV) or (V) of subparagraph (D)(iv) shall not be treated as an eligible retirement Oi > (/. i ,*t plan for the transfer of a distribution if any part of the distribution is attributable to contributions made on behalf of the employee while he was a key employee in a top-heavy plan. For purposes of the preceding sent* •)8'i; i y., tence, the terms 'key employee' and 'top-heavy plan' have the same respective meanings as when used in section 416." (d) AMENDMENTS RELATED TO SECTION 238.— (1) REPEAL OF SECTION 72 (m)(9).—Paragraph (9) of section
72(m) (relating to return of excess contributions before due date of return) is hereby repealed. <
(2) INCREASE IN AMOUNT OF DEDUCTION FOR SIMPLIFIED EMPLOYEE PENSIONS.—Clause (ii) of section 219(b)(2)(A) (relating to
special rules for employer contributions under simplified employee pensions) is amended by striking out "but not in excess of
26 USC 72. 26 USC 219. '
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