Page:United States Statutes at Large Volume 100 Part 3.djvu/1064

 100 STAT. 2872

PUBLIC LAW 99-514—OCT. 22, 1986

For purposes of this subsection, the term 'employee' has the meaning given to such term by section 132(f) of the Internal Revenue Code of 1954." (e) TREATMENT OF CERTAIN LEASED OPERATIONS OF DEPARTMENT

STORES.—For purposes of section 132(h)(2)(B) of the Internal Revenue Code of 1954, a leased section of a department store which, in connection with the offering of beautician services, customarily makes sales of beauty aids in the ordinary course of business shall be treated as engaged in over-the-counter sales of property. (f) TRANSITIONAL RULES FOR TREATMENT OF CERTAIN REDUCTIONS IN TUITION.—

(1) A tuition reduction plan shall be treated as meeting the requirements of section 117(d)(3) of the Internal Revenue Code of 1954 if— (A) such plan would have met the requirements of such ac section (as amended by this section but without regard to the lack of evidence that benefits under such plan were the yi subject of good faith bargaining) on the day on which eligibility to participate in the plan was closed, (B) at all times thereafter, the tuition reductions availii' able under such plan are available on substantially the same terms to all employees eligible to participate in such plan, and

(C) the eligibility to participate in such plan closed on June 30, 1972, June 30, 1974, or December 31, 1975. (2) For purposes of applying section 117(d)(3) of the Internal Revenue Code of 1954 to all tuition reduction plans of an employer with at least 1 such plan described in paragraph (1) of this subsection, there shall be excluded from consideration employees not included in the plan who are included in a unit of employees covered by an agreement that the Secretary of the Treasury or his delegate finds to be a collective bargaining agreement between employee representatives and 1 or more employers, if, with respect to plans other than plans described in paragraph (1), there is evidence that such benefits were the subject of good faith bargaining. ' (3) Any reduction in tuition provided with respect to a fulltime course of education furnished at the graduate level before July 1, 1988, shall not be included in gross income if^ (A) such reduction would not be included in gross income under the Internal Revenue Service regulations in effect on the date of the enactment of the Tax Reform Act of 1984, and (B) such reduction is provided with respect to a student who was accepted for admission to such course of education '• before July 1, 1984, and began such course of education before June 30, 1985. SEC. 1854. AMENDMENTS RELATED TO EMPLOYEE STOCK OWNERSHIP PLANS. ' (a) AMENDMENTS RELATED TO SECTION 541.—

(1) Section 1042(a) (relating to nonrecognition of gai;i) is amended— (A) by striking out "gain (if any) on such sale" and inserting in lieu thereof "gain (if any) on such sale ^hich would be recognized as long-term capital gain", and

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