PUBLIC LAW 94-455—OCT. 4, 1976
90 STAT. 1589
(D) striking out "this subsection" each time i t appears in paragraph (11) and substituting in lieu thereof "this subsection o r subsection (e) o r (f) ". (f) LIMITATIONS ON CONTRIBUTIONS.— (1) SPECIAL LIMITATION FOR EMPLOYEE
STOCK
OWNERSHIP
PLANS.—Section 415(c) (relating to limitation for defined con- 26 USC 4l5. tribution plans) is amended by adding a t the end thereof the following new paragraph: " (6) SPECIAL PLAN.—
LIMITATION
FOR EMPLOYEE
STOCK
OWNERSHIP
" (A) I n the case of a n employee stock ownership plan ( a s defined in subparagraph (B)), under which no more than one-third of the employer contributions for a year are allocated to the group of employees consisting of officers, shareholders owning more than 10 percent of the employer's stock (determined under subparagraph (B) ( i v)), or employees described in subparagraph (B) ( i i i), the amount described in paragraph (c)(1)(A) (as adjusted for such year pursuant to subsection (d)(1)) for a year with respect to any participant shall be equal to the sum of (i) the amount described in paragraph (c)(1)(A) (as so adjusted) determined without regard to this paragraph and (ii) the lesser of the amount determined under clause (i) or the amount of employer securvities contributed to the employee stock ownership plan. " (B) For purposes of this paragraph — Definitions, " (i) the term 'employee stock ownership plan' means a plan which meets the requirements of section 4975(6) (7) or section 301(d) of the T a x Reduction Act of 1975, 26 USC 46 note. " ( i i) the term 'employer securities' means, in the case of an employee stock ownership plan within the meaning of section 4 9 7 5 (e)(7), qualifying employer securities within the meaning of section 4 9 7 5 (e)(8), but only if they a r e described in section 301(d)(9)(A) of the T a x Reduction Act of 1975, or, in the case of an employee stock ownership plan described in section 3 0 1 (d)(2) of the T a x Reduction Act of 1975, employer securities within the meaning of section 301(d)(9)(A) of such Act, " ( i i i) a n employee described in this clause is any participant whose compensation for a year exceeds an amount equal to twice the amount described in paragraph (1)(A) for such year (as adjusted for such year pursuant to subsection (d)(1)), determined without regard to subparagraph (A) of this paragraph, and " ( i v) a n individual shall be considered to own more than 10 percent of the employer's stock if, without regard to stock held under the employee stock ownership plan, he owns (after application of section 1563(e)) more than 10 percent of the total combined voting power of all classes of stock entitled to vote or more than 10 percent of the total value of shares of all classes of stock.". (2) CONFORMING AMENDMENT. — Paragraph (3)(B) of section
415 (e) (relating to defined contribution plan fraction) is amended by inserting "determined without regard to paragraph (6) of such subsection)" after "employer". (g) WAIVER o r P E N A L T Y FOR UNDERPAYMENT OF ESTIMATED T A X. —
[f—
26 USC 6655
note.
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