Page:United States Statutes at Large Volume 103 Part 1.djvu/859

 PUBLIC LAW 101-140—NOV. 8, 1989 103 STAT. 831 maintained by a church for church employees, and the term 'church' means any church (as defined in section 3121(w)(3)(A)) or qualified church-controlled organization (as defined in section 3121(w)(3)(B)). " (6)(A) Subparagraph (C) of section 414(n)(3) is amended by striking "89,". (B) Paragraph (1) of section 414(r) is amended by striking "sections 89 and" and inserting "section". (C) Paragraph (2) of section 414(t) is amended by striking "89,". (7) Sections 3021(c) and 6070 of the Technical and Miscellane- 26 USC 89 notes, ous Revenue Act of 1988 are hereby repealed, (b) EXCEPTIONS. — (1)(A) Paragraph (7) of section 79(d) (as in effect on the day before the date of the enactment of the Tax Reform Act of 1986) is amended to read as follows: " (7) EXEMPTION FOR CHURCH PLANS. — "(A) IN GENERAL.— Th is subsection shall not apply to a church plan maintained for church employees. "(B) DEFINITIONS.—For purposes of subparagraph (A), the terms 'church plan' and 'church employee' have the mean- ing given such terms by paragraphs (1) and (3)(B) of section 414(e), respectively, except that— "(i) section 414(e) shall be applied by substituting 'section 501(c)(3)' for 'section 501' each place it appears, and "(ii) the term 'church employee' shall not include an employee of— "(I) an organization described in section 170(b)(l)(A)(ii) above the secondary school level (other than a school for religious training), "(II) an organization described in section 170(b)(l)(A)(iii), and "(III) an organization described in section 501(c)(3), the basis of the exemption for which is substantially similar to the basis for exemption of an organization described in subclause (II)." (2) Paragraph (2) of section 125(d) (as in effect on the day before the date of the enactment of the Tax Reform Act of 1986) is amended to read as follows: " (2) DEFERRED COMPENSATION PLANS EXCLUDED.— "(A) IN GENERAL.—The term 'cafeteria plan' does not include any plan which provides for deferred compensation. " (B) EXCEPTION 70R CASH AND DEFERRED ARRANGE- MENTS. —Subparagraph (A) shall not apply to a profit-shar- ing or stock bonus plan or rural cooperative plan (within the meaning of section 401(k)(7)) which includes a qualified cash or deferred arrangement (as defined in section 401(k)(2)) to the extent of amounts which a covered em- ployee 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 EDU- CATIONAL INSTITUTIONS.—Subparagraph (A) shall not apply to a plan maintained by an educational organization de- scribed in section 170(b)(l)(A)(ii) to the extent of amounts which a covered employee may elect to have the employer

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