Page:United States Statutes at Large Volume 90 Part 2.djvu/459

 PUBLIC LAW 94-455—OCT. 4, 1976

90 STAT. 1927

" (5) CONTRIBUTIONS.—Amounts contributed under the plan shall be paid only (A) to insurance companies, or to organizations or persons that provide personal legal services, or indemnification against the cost of personal legal services, in exchange for a prepayment or payment of a premium, (B) to organizations or trusts described in section 501(c) (20), (C) to organizations Infra. described in section 501(c) which are permitted by that section to receive payments from an employer for s u p p o r t of one or more qualified group legal services plan or plans, except that such organizations shall p a y or credit the contribution to an organization or trust described in section 501(c) ( 2 0), (D) as prepayments to providers of legal services under the plan, or (E) a combination of the above. '"^

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" (d) OTHER DEFINITIONS AND SPECIAL RULES. — For purposes of t h i s

section— "(1)

SELF-EMPLOYED INDIVIDUAL; EMPLOYEE.—The term 'self-

employed individual' means, and the term 'employee' includes, for any year, an individual who is an employee within the meaning of section 401(c)(1) (relating to self-employed individuals). " (2) EMPLOYER.—An individual who owns the entire interest in an unincorporated trade or business shall be treated as his own employer. A partnership shall be treated as the employer of each part n e r who is an employee within the meaning of paragraph (1). ' " (3) ALLOCATIONS.— Allocations of amounts contributed under the plan shall be made in accordance with regulations prescribed by the Secretary and shall take into account the expected relative utilization of benefits to be provided from such contributions or plan assets and the manner in which any premium or other charge was developed. " (4) DEPENDENT.—The term 'dependent' has the meaning given "Dependent." to it by section 152. " (5) EXCLUSIVE BENEFIT.—In the case of a plan to which contributions are made by more than one employer, i n determining whether the plan is for the exclusive benefit of an employer's employees or their spouses or dependents, the employees of any employer who maintains the plan shall be considered to be the employees of each employer who maintains the plan. " (6) ATTRIBUTION RULES.—For purposes of t h i s section—

" (A) ownership of stock in a corporation shall be determined in accordance with the rules provided under subsections (d) and (e) of section 1563 (without regard to section 1563(e)(3)(C)), and " (B) the interest of an employee in a trade or business which is not incorporated shall be determined in accordance with regulations prescribed by the Secretary, which shall be based on principles similar to the principles which apply in the case of subparagraph (A).

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" (7) T I M E OF NOTICE TO SECRETARY.—A p l a n shall not be a quali-

fied group legal services plan for any period prior to the time notification was provided to the Secretary in accordance with subsection (c)(4), if such notice is given after the time prescribed by the Secretary by regulations for giving such notice." (b) E X E M P T STATUS.—Section 501(c) (relating to exempt organi- 26 USC 501. zations) is amended by a d d i n g a t the end thereof the following new paragraph: " ( 2 0) an organization or t r u s t created or organized in the United States, the exclusive function of which is to form part of

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