Page:United States Statutes at Large Volume 90 Part 2.djvu/93

 PUBLIC LAW 94-455—OCT. 4, 1976

90 STAT. 1561

" (e) ELECTION OF PRIOR L A W W I T H RESPECT TO P U B L I C RETIREMENT SYSTEM I N C O M E. —

" (1) IN GENERAL.—In the case of a taxpayer who has not attained age 65 before the close of the taxable year (other than a married individual whose spouse has attained age 65 before the close of the taxable year), his credit (if any) under this section shall be determined under this subsection. "(2)

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O N E SPOUSE AGE 65 OR OVER.—In the case of a m a r r i e d

individual who has not attained age 65 before the close of the taxable year b u t whose spouse has attained such age, this paragraph shall apply for the taxable year only if both spouses elect, at such time and in such manner as the Secretary shall by regulations prescribe, to have this paragraph apply. I f this paragraph applies for the taxable year, the credit (if any) of each spouse under this section shall be determined under this subsection. "(3)

COMPUTATION OF CREDIT.—In the case of an i n d i v i d u a l

whose credit under this section for the taxable year is determined v under this subsection, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to 15 percent of the amount received by such individual as retirement income (as defined in paragraph (4) and as limited by paragraph (5)). " (4) RETIREMENT INCOME.—For purposes of this subsection, the "Retirement term 'retirement income' means— income. " (A) in the case of an individual who has attained age 65 before the close of the taxable year, income from— " (i) pensions and annuities (including, in the case of an individual w h o is, o r has been, an employee within the meaning of section 401(c)(1), distributions by a trust 26 USC 401. described in section 401(a) which is exempt from tax under section 501(a)), " ( i i) interest, " ( i i i) rents, . •: • • " ( i v) dividends, " (v) bonds described in section 405(b)(1) which are received under a qualified bond purchase plan described in section 405(a) or i n a distribution from a t r u s t described i n section 401(a) which is exempt from tax under section 5 0 1 (a), or retirement bonds described in section 409, and " ( v i) a n individual retirement account described i n section 408(a) o r a n individual retirement annuity described in section 408(b), or " (B) in the case of an individual who has not attained age 65 before the close of the taxable year, income from pensions and annuities under a public retirement system (as defined in paragraph (8)(A)), to the extent included in gross income without reference to this subsection, b u t only to the extent such income does not represent compensation for personal services rendered during the taxable year. " (5) L I M I T A T I O N ON RETIREMENT I N C O M E. — For purposes of t h i s

subsection, the amount of retirement income shall not exceed $2,500 less— " (A) the reduction provided by subsection (b)(3), and " (B) i n the case of any individual who has not attained age 72 before the close of the taxable year—

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