Page:United States Statutes at Large Volume 102 Part 4.djvu/499

 PUBLIC LAW 100-647—NOV. 10, 1988

102 STAT. 3469

"(B) DISTRIBUTIONS MUST BE LUMP SUM DISTRIBUTIONS.—

"(i) IN GENERAL.—An event shall not be treated as described in subparagraph (A) with respect to any employee unless the employee receives a lump sum distribution by reason of the event. "(ii) LUMP SUM DISTRIBUTION.—For purposes of this

subparagraph, the term 'lump sum distribution' has the meaning given such term by section 402(e)(4), without regard to clauses (i), (ii), (iii), and (iv) of subparagraph (A), subparagraph (B), or subparagraph (H) thereof. "(C) TRANSFEROR CORPORATION MUST MAINTAIN PLAN.—An

event shall not be treated as described in clause (ii) or (iii) of subparagraph (A) unless the transferor corporation continues to maintain the plan after the disposition." (C)(i) Subparagraph (A)(i) of section 401(k)(10) of the 1986 Code 26 USC 401 note. (as added by subparagraph (B)) shall apply to distributions after October 16, 1987. (ii) Subparagraph (B) of section 401(k)(10) of the 1986 Code (as added by subparagraph (B)) shall apply to distributions after March 31, 1988. (2) Subparagraph (B) of section 401(k)(2) of the 1986 Code is amended— (A) by inserting "amounts held by the trust which are attributable to employer contributions made pursuant to the employee's election" after "under which", (B) by striking out "amounts held by the trust which are attributable to employer contributions made pursuant to the employee's election" in clause (i), and (C) by striking out "amounts" in clause (ii). (3)(A) Clause (ii) of section 401(k)(3)(A) of the 1986 Code is amended by inserting "eligible" before "highly compensated employees" each place it appears. (B) Section 1116(b)(4) of the Reform Act is amended by strik- 26 USC 401. ing out "any" the first place it appears and inserting in lieu thereof "an'\ (4) Subparagraph (C) of section 401(k)(3) of the 1986 Code, as added by section 1116(e) of the Reform Act, is redesignated as subparagraph (D). (5) Subclause (I) of section 401(k)(3)(D)(ii) of the 1986 Code, as redesignated by paragraph (4), is amended by striking out "meets" and inserting in lieu thereof "meet". (6) Section 401(k)(4)(A) of the 1986 Code is amended by striking out "provided by such employer". (7) Section 401(k)(8) of the 1986 Code (relating to arrangement not disqualified if excess contributions distributed) is amended by redesignating subparagraph (E) as subparagraph (F) and by inserting after subparagraph (D) the following new subparagraph: "CE) TREATMENT OF MATCHING CONTRIBUTIONS FORFEITED BY REASON OF EXCESS DEFERRAL OR CONTRIBUTION.—For pur-

poses of paragraph (2)(C), a matching contribution (within the meaning of subsection (m)) shall not be treated as forfeitable merely because such contribution is forfeitable if the contribution to which the matching contribution relates is treated as an excess contribution under subparagraph

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