Page:United States Statutes at Large Volume 78.djvu/104

 62

PUBLIC LAW 88-272-FEB. 26, 1964

[78 STAT.

"(2) such individual ceases to be an employee of a domestic subsidiary of such domestic parent corporation, if he becomes an employee of another corporation controlled by such domestic parent corporation, or "(3) the provision of the pLan described in subsection (a)(1) (A) is terminated. " (d) DEDUCTIBILITY OF COXTKIBUTIONS.—For purposes of apply76^stlt!M*9 ^2^6 ^"S sections 404 and 405(c) with respect to contributions made to or 26 USC 404,40*5. under a pension, profit-sharing, stock bonus, annuity, or bond purdiase plan by a domestic parent corporation, or by another corporation which is entitled to deduct its contributions under section 404 (a)(3)(B), on belialf of an individual who is treated as an employee of such domestic corporation under subsection (a)— "(1) except as provided in paragraph (2), no deduction shall be allowed to such domestic parent corporation or to any other corporation which is entitled to deduct its contributions under such sections, "(2) there shall be allowed as a deduction to the domestic subsidiary of which such individual is an employee an amount equal to the amount which (but for paragraph (1)) would be deductible under section 404 (or section 405(c)) by the domestic parent corporation if he were an employee of the domestic parent corporation, and "(3) any reference to compensation shall be considered to be a I'eference to the total compensation of such individual (determined with the application of subsection (b)(2)). Ally amount deductible by a domestic subsidiary under this subsection shall be deductible for its taxable year with or within which the taxable year of such domestic parent corporation ends. "(e)

26 USC 72. 26 USC 101. 26 USC 2039. 72 Stat. 1659.

TREATMENT AS P^MPLOYEE LTNUEK RELATED PROVISIONS,—An

individual who is treated as an employee of a domestic parent corporation under subsection (a) shall also be treated as an employee of such domestic parent corporation, with respect to the plan described in subsection (a)(1)(A), for purposes of applying the following I)r<)visions of this title: '^(1) Section 72(d) (relating to employees' annuities). "(2) Section T2(f) (relating to special rules for computing employees' contributions). "(4) Section 2039 (relatingto annuities). «(5) Section 2517 (relating to certain annuities under quali-
 * ^^3) Section 101(b) (relathig to employees' death benefits).

26 u SC2517*

i » i

1

\*s

ned plans), (c)

26 USC 3121.

26 USC 403.

TECHNICAL AMENDMENTS.—

(1) The table of sections for part I of subchapter D of chapter 1 is amended by adding at the end thereof the following: "Sec. 4(Hi. Certain employees of foreign subsidiaries. "Sec. 407. Certain employees of domestic subsidiaries engaged in business outside the United States." ^2) Section 3121(a)(5) (relating to definition of wages) is amended by striking out "or" at the end of subparagraph (A) and by striking out subparagraph (B) and inserting in lieu thereof the following new subparagraphs: " (B) under or to an annuity plan which, at the time of such payment, is a plan described in section 403(a), or " (C) under or to a bond purchase plan which, at the time of such payment, is a qualified bond purchase plan described in.section 405(a);".

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