Page:United States Statutes at Large Volume 100 Part 3.djvu/697

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2505

ing or stock bonus plan which includes a qualified cash or deferred arrangement (as defined in section 401(k)(2)) to the extent of amounts which a covered employee may elect to have the employer pay as contributions to a trust under such plan on behalf of the employee. "(C) EXCEPTION FOR CERTAIN PLANS MAINTAINED BY EDUCATIONAL INSTITUTIONS.—Subparagraph (A) shall not apply

to a plan maintained by an educational organization described in section 170(b)(l)(A)(ii) to the extent of amounts which a covered employee may elect to have the employer pay as contributions for post-retirement group life insurance if— "(i) all contributions for such insurance must be •J made before retirement, and "(ii) such life insurance does not have a cash surrender value at any time. For purposes of section 79, any life insurance described in the preceding sentence shall be treated as group-term life insurance. "(d) HIGHLY COMPENSATED EMPLOYEE.—For purposes of this section, the term 'highly compensated employee' has the meaning given such term by section 414(q). "(e) QUALIFIED BENEFITS DEFINED.—For purposes of this section— "(1) IN GENERAL.—The term 'qualified benefit' means any benefit which, with the application of subsection (a), is not includible in the gross income of the employee by reason of an express provision of this chapter (other than section 117, 124, 127, or 132). "(2) CERTAIN BENEFITS INCLUDED.—The term 'qualified benefits' includes— "(A) any group-term life insurance which is includible in gross income only because it exceeds the dollar limitation of section 79, and "(B) any other benefit permitted under regulations. "(f) COLLECTIVELY BARGAINED PLAN NOT CONSIDERED DISCRIMINA-

TORY.—For purposes of this section, a plan shall not be treated as discriminatory if the plan is maintained under an agreement which the Secretary finds to be a collective bargaining agreement between employee representatives and one or more employers. "(g) CROSS REFERENCES.— "For reporting and recordkeeping requirements, see section 6039D." (2) APPLICATION WITH EMPLOYMENT TAXES.—

(A) Section 3121(a)(5) is amended by striking out "or" at the end of subparagraph (E), by inserting "or" at the end of subparagraph (F), and by inserting after subparagraph (F) the following new subparagraph: "(G) under a cafeteria plan (within the meaning of section 125)," (B) Section 3306(b)(5) is amended by striking out "or" at the end of subparagraph (E), by inserting "or" at the end of subparagraph (F), and by inserting after subparagraph (F) the following new subparagraph: v:i ^

"(G) under a cafeteria plan (within the m e a n i n g of section 125)," (C) Section 209(e) of the Social Security Act is amended by inserting before the semicolon a t the end thereof the follow-

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