Page:United States Statutes at Large Volume 100 Part 3.djvu/1063

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2871

treated as a termination of such collective bargaining agreement," (3) SPECIAL RULE WHERE CONTRIBUTIONS OR REIMBURSEMENTS

SUSPENDED.—Paragraph (5) of section 531(b) of the Tax Reform Act of 1984 is amended by adding at the end thereof the following new subparagraph: "(E) SPECIAL RULE WHERE CONTRIBUTIONS OR REIMBURSE-

MENTS SUSPENDED.—For purposes of subparagraphs (A) and (B), a plan shall not be treated as not continuing to fail to gr;-ii satisfy the rules referred to in such subparagraphs with respect to any benefit provided in the form of a flexible u. spending arrangement merely because contributions or reimbursements (or both) with respect to such plan were suspended before January 1, 1985." (c) AMENDMENTS TO SECTION 4977.— (1) Paragraph (2) of section 4977(c) is amended to read as follows: "(2) at all times on or after January 1, 1984, and before the close of the calendar year involved, substantially all of the employees of the employer were entitled to employee discounts on goods or services provided by the employer in 1 line of business,". (2) Section 4977 (relating to tax on certain fringe benefits provided by an employer) is amended by adding at the end thereof the following new subsection: "(f) SECTION TO APPLY ONLY TO EMPLOYMENT WITHIN THE UNITED

STATES.—Except as otherwise provided in regulations, this section shall apply only with respect to employment within the United States." (3) For purposes of determining whether the requirements of section 4977(c) of the Internal Revenue Code of 1954 are met in the case of an agricultural cooperative incorporated in 1964, there shall not be taken into account employees of a member of the same controlled group as such cooperative which became a member during July 1980. (d) TREATMENT OF TELEPHONE CONCESSION SERVICE FOR CERTAIN

RETIREES.—Section 559 of the Tax Reform Act of 1984 is amended by adding at the end thereof the following subsection: "(e) TELEPHONE SERVICE FOR PRE-DIVESTITURE RETIREES.—In

the

case of an employee who, by reason of retirement or disability, separated before January 1, 1984, from the service of an entity subject to the modified final judgment— "(1) all entities subject to the modified final judgment shall be treated as a single employer in the same line of business for purposes of determining whether telephone service provided to the employee is a no-additional-cost service as defined in section 132 of the Internal Revenue Code of 1954; and "(2) payment by an entity subject to the modified final judgment of all or part of the cost of local telephone service provided to the employee by a person other than an entity subject to the modified final judgment (including rebate of the amount paid by the employee for the service and payment to the person providing the service) shall be treated as telephone service provided to the employee by such single employer for purposes of determining whether the telephone service is a no-additional-cost service as defined in section 132 of the Internal Revenue Code of 1954.

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