Page:United States Statutes at Large Volume 81.djvu/875

 81 STAT. ]

PUBLIC LAW 90-248-JAN. 2, 1968

841

Any modification of an agreement pursuant to this paragraph shall be effective with respect to services performed after an effective date, specified in such modification, which shall not be earlier than the last day of the calendar quarter in which the modification is mailed or delivered by other means to the Secretary." (d) The first sentence of section 218(d)(6)(F) of the Social Security Act is amended by striking out "1967" and inserting in lieu thereof 7/st^r385°^^' "1970".

42 USC 418.

INCLUSION OF ILLINOIS AMONG STATES PERMITTED TO DIVIDE THEIR RETIREMENT SYSTEMS

SEC. 117. Section 2 1 8 (d)(6)(C) of the Social Security Act is amended by inserting "Illinois," after "Georgia,". TAXATION OF CERTAIN EARNINGS OF RETIRED PARTNER

SEC. 118. (a) Section 1402(a) of the Internal Revenue Code of 1954 (relating: to definition of net earnings from self-employment) is ^

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amended— (1) by striking out "and" at the end of paragraph (8); (2) by striking out the period at the end of paragraph (9) and inserting in lieu thereof "; and"; and (3) by inserting after paragraph (9) the following new paragraph: "(10) there shall be excluded amounts received by a partner pursuant to a written plan of the partnership, which meets such requirements as are prescribed by the Secretary or his delegate, and which provides for payments on account of retirement, on a periodic basis, to partners generally or to a class or classes of partners, such payments to continue at least until such partner's death, if— " (A) such partner rendered no services with respect to any trade or business carried on by such partnership (or its successors) during the taxable year of such partnership (or its successors), ending within or with his taxable year, m which such amounts were received, and " (B) no obligation exists (as of the close of the partnership's taxable year referred to in subparagraph (A)) from the other partners to such partner except with respect to retirement payments under such plan, and " (C) such partner's share, if any, of the capital of the partnership has been paid to him in full before the close of the partnership's taxable year referred to in subparagraph (A). " (b) Section 211(a) of the Social Security Act is amended— (1) by striking out "and" at the end of paragraph (7); (2) by striking out the period at the end of paragraph (8) and inserting in lieu thereof "; and"; and (3) by inserting after paragraph (8) the following new paragraph: "(9) There shall be excluded amounts received by a partner pursuant to a written plan of the partnership, which meets such requirements as are prescribed by the Secretary of the Treasury or his delegate, and which provides for payments on account of retirement, on a periodic basis, to partners generally or to a class or classes of partners, such payments to continue at least until such partner's death, if— " (A) such partner rendered no services with respect to any trade or business carried on by such partnership (or its

68 A Stat. 353; 68 Stat. 1087.

^^ Stat. 502; 42 USC 4u'.

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