Page:United States Statutes at Large Volume 100 Part 3.djvu/621

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2429

under the method of distributions being used under subclause (I) as of the date of his death, or "(ii) in the case of a distribution which does not begin before the death of the participant, the entire amount payable with respect to the participant will be paid during a period not to exceed 15 years (or the life expectancy of the surviving spouse if such spouse is the beneficiary). 1 "(C) NoNiNCREASiNG BENEFITS.—A plan meets the lrequirements of this subparagraph if any distribution payable over a period of more than 1 year can only be made in substantially nonincreasing amounts (paid not less frequently than annually). "(e) OTHER DEFINITIONS AND SPECIAL RULES.—For purposes of this section— "(1) ELIGIBLE EMPLOYER.—The term 'eligible employer' means— "(A) a State, political subdivision of a State, and any agency or instrumentality of a State or political subdivision of a State, and, ^^, "(B) any other organization (other than a governmental unit) exempt from tax under this subtitle. "(2) PERFORMANCE OF SERVICE.—The performance of service

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includes performance of service as an independent contractor and the person (or governmental unit) for whom such services are performed shall be treated as the employer, "(3) PARTICIPANT.—The term 'participant' means an individual who is eligible to defer compensation under the plan. "(4) BENEFICIARY.—The term 'beneficiary' means a beneficiary of the participant, his estate, or any other person whose interest in the plan is derived from the participant. "(5) INCLUDIBLE COMPENSATION.—The term 'includible compensation' means compensation for service performed for the employer which (taking into account the provisions of this section and other provisions of this chapter) is currently includible in gross income. "(6) COMPENSATION TAKEN INTO ACCOUNT AT PRESENT VALUE.—

Compensation shall be taken into account at its present value. "(7) COMMUNITY PROPERTY LAWS.—The amount of includible compensation shall be determined without regard to any community property laws. "(8) INCOME ATTRIBUTABLE.—Gains from the disposition of property shall be treated as income attributable to such property. ' (9) BENEFITS NOT TREATED AS MADE AVAILABLE BY REASON OF CERTAIN ELECTIONS.—If^

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"(A) the total amount payable to a participant under the plan does not exceed $3,500, and "(B) no additional amounts may be deferred under the plan with respect to the participant, the amount payable to the participant under the plan shall not be treated as made available merely because such participant may elect to receive a lump sum payable within 60 days of the election. "(10) TRANSFERS BETWEEN PLANS.—A participant shall not be required to include in gross income any portion of the entire amount payable to such participant solely by reason of the

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