Page:United States Statutes at Large Volume 92 Part 3.djvu/163

 PUBLIC LAW 95-600—NOV. 6, 1978

92 STAT. 2795

(f) TECHNICAL AND CONFORMING AMENDMENTS.—

(1) Subsections (d), (e), and (f) of section 301 of the Tax Reduction Act of 1975 are hereby repealed. (2) Subparagraph (E) of section 46(a)(2) is amended— (A) by striking out "section 301(e) of the Tax Reduction Act of 1975" and inserting in Heu thereof "section 48(n)(l)(B)", and (B) by striking out "section 301(d) of the Tax Reduction Act of 1975" and inserting in Heu thereof "section 409A". (3) Paragraph (21) of section 401(a) is amended to read as follows: "(21) A trust forming part of an ESOP shall not fail to be considered a permanent program merely because employer contributions under the plan are determined solely by reference to the amount of credit which would be allowable under section 46(a) if the employer made the transfer described in section

48(n)(l)."

(4) The last sentence of section 1504(a) (defining affiliated group) is amended to read as follows: "As used in this subsection, the term 'stock' does not include nonvoting stock which is limited and preferred as to dividends, employer securities (within the meaning for section 409A(1)) while such securities are held under an ESOP, or qualifying employer securities (within the meaning of section 4975(e)(8)) while such securities are held under a leveraged employee stock ownership plan which meets the requirements of section 4975(e)(7)." (5) Paragraph (7) of section 4975(e) (defining employee stock ownership plan) is amended— (A) by striking out "EMPLOYEE" in the paragraph heading and inserting in lieu thereof "LEVERAGED EMPLOYEE", and (B) by striking out "employee" in the text and inserting in lieu thereof "leveraged employee", and (C) by adding at the end thereof the following new sentence: "A plan shall not be treated as as leveraged employee stock ownership plan unless it meets the requirements of subsections (e) and (h) of section 409A." (6) Paragraph (3) of section 4975(d) is amended by striking out "employee" and inserting in lieu thereof "leveraged employee". (7) Subparagraph (B) of section 415(c)(6) is amended by striking out clauses (i) and (ii) and inserting in lieu thereof the following: "(i) the term 'employee stock ownership plan' means a leveraged employee stock ownership plan (within the meaning of section 4975(e)(7)) or an ESOP, "(ii) the term 'employer securities' has the meaning given to such term by section 409A,". (8) The table of sections for part I of subchapter D of chapter 1 is amended by inserting after the item relating to section 409 the following new item:

Repeal. 26 USC 46 note. 26 USC 46. 26 USC 48.

26 USC 401.

26 USC 26.

26 USC 48. 26 USC 1504.

Ante, p. 2787. 26 USC 4975. 26 USC 4975.

Ante, p. 2787. 26 USC 4975. 26 USC 415.

26 USC 4975. Ante, p. 2787.

"Sec. 409A. Qualification for ESOPs."

(9) Section 404(a)(2) and section 805(d) are each amended by 26 USC 404, striking out "and (20)" and inserting in lieu thereof "(20), and ^o^(22)". (g) EFFECTIVE DATES.— 26 USC 409A (1) IN GENERAL.—The amendments made by this section (other note. than by subsection (f)(3)) shall apply with respect to qualified investment for taxable years beginning after December 31, 1978.

�