76 STAT.]
PUBLIC LAW 87-863-OCT. 23, 1962
1141
Public Law 87-863 October 23, 1962 AN ACT [H. R. 10620] To amend section 213 of the Internal Revenue Code of 1954 to increase the maximum limitations on the amount allowable as a deduction for medical, dental, etc., expenses, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That (a) subsection T axe s. Medical ex(c) of section 213 of the Internal Revenue Code of 1954 (relating to pense deductions. maximum limitations on deduction for medical, dental, etc.. expenses) 26 USC 213. is amended— (1) by striking out "$2,500" and inserting in lieu thereof "$5,000", (2) by striking out "$5,000" and inserting in lieu thereof "$10,000", and (3) by striking out "$10,000" and inserting in lieu thereof "$20,000". (b) Subsection (g) of such section (relating to maximum limitation if taxpayer or spouse has attained age 65 and is disabled) is amended— (1) by striking out "$15,000" each place it appears therein and inserting in lieu thereof "$20,000", and (2) by striking out "$30,000" and inserting in lieu thereof "$40,000". (c) The amendments made by subsections (a) and (b) shall apply only with respect to taxable years beginning after December 31,196L SEC. 2. (a) Section 401 of the Internal Revenue Code of 1954 26 USC 401. (relating to qualified pension, profit-sharing, and stock bonus plans) is amended by redesignating subsection (h) as subsection (i) and Ante, p. 811. by inserting after subsection (g) the following new subsection: Ante, p. 819. " (h) MEDICAL, ETC.. BENEFITS FOR RETIRED EMPLOYEES AND THEIR SPOUSES AND DEPENDENTS.—Under regulations prescribed by the Sec-
retary or his delegate, a pension or annuity plan may provide for the payment of benefits for sickness, accident, hospitalization, and medical expenses of retired employees, their spouses and their dependents, but only if— "(1) such benefits are subordinate to the retirement benefits provided by the plan, "(2) a separate account is established and maintained for such benefits, "(3) the employer's contributions to such separate account are reasonable and ascertainable, "(4) it is impossible, at any time prior to the satisfaction of all liabilities under the plan to provide such benefits, for any part of the corpus or income of such separate account to be (within the taxable year or thereafter) used for, or diverted to, any purpose other than the providing of such benefits, and "(5) notwithstanding the provisions of subsection (a)(2), upon the satisfaction of all liabilities under the plan to provide such benefits, any amount remaining in such separate account must, under the terms of the plan, be returned to the employer." (b) Section 404(a)(2) of such Code (relating to employees' annuities) is amended— (1) by inserting after "purchase of retirement annuities" the following: ", or retirement annuities and medical benefits as described in section 401(h),"; and (2) by inserting after "such retirement annuities" the following: ", or such retirement annuities and medical benefits".
26 USC 404.
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