Page:United States Statutes at Large Volume 102 Part 4.djvu/732

 102 STAT. 3702

PUBLIC LAW 100-647—NOV. 10, 1988 nonelective deferred compensation under a d e ^ i t e, fixed and uniform benefit formula. (C) TERMINATION.—This paragraph shall cease to apply to a plan as of the effective date of the first material modification of the plan agreed to after December 31, 1987. (3) TREATMENT OF CERTAIN NONELECTIVE DEFERRED COMPENSA-

Reports.

26 USC 401 note.

TION.—Section 457 of the 1986 Code shall not apply to amounts deferred under a nonelective deferred compensation plan maintained by an eligible employer described in section 457(e)(l)(A) of the 1986 Code (as in effect after the Reform Act)— (A) if such amounts were deferred from periods before July 14, 1988, or (B)if(i) such amounts are deferred from periods on or after such date pursuant to an agreement which— (I) was in writing on such date, and (II) on such date provides for a deferral for each taxable year covered by the agreement of a fixed amount or of an amount determined pursuant to a fixed formula, and (ii) the individual with respect to whom the deferral is made was covered under such agreement on such date. Subparagraph (B) shall not apply to any taxable year ending after the date on which any modification of the amount or formula described in subparagraph (B)(i)(II) agreed to in writing before January 1, 1989, is effective. The preceding sentence shall not apply to a modification agreed to in writing before January 1, 1989, which does not increase any benefit of a participant. Amounts described in the first sentence of this paragraph shall be taken into account for purposes of applying section 457 of the 1986 Code to other amounts deferred under any eligible deferred compensation plan. (4) STUDY.—The Secretary of the Treasury or his delegate shall conduct a study on the tax treatment of deferred compensation paid by State and local governments and tax-exempt organizations (including deferred compensation paid to independent contractors). Not later than January 1, 1990, the Secretary shall submit to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate a report on the study conducted under this paragraph together with such recommendations as he may deem advisable. SEC. 6065. EXCEPTION FOR GOVERNMENTAL PLANS.

In the case of plan years beginning before January 1, 1993, section 401(a)(26) of the 1986 Code shall not apply to any governmental plan (within the meaning of section 414(d) of such Code) with respect to employees who were participants in such plan on July 14, 1988. SEC. 6066. AIR TRANSPORTATION OF CARGO AND OF PASSENGERS TREATED AS SAME SERVICE FOR PURPOSES OF FRINGE BENEFITS INCLUSION.

(a) IN GENERAL.—Subsection (h) of section 132 of the 1986 C!ode is amended by adding at the end thereof the following new paragraph:

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