Page:United States Statutes at Large Volume 94 Part 1.djvu/248

 94 STAT. 198 26 USC 4975.

PUBLIC LAW 96-222—APR. 1, 1980 applicable to section 4975 of such Code, to stock acquired after December 31, 1979, and "(2) insofar as they make paragraphs (1)(A) and (2) of section 409A(h) of such Code applicable to such section 4975, to distributions after December 31, 1978." (C) DEFINITION OF QUALIFYING EMPLOYER SECURITY FOR

26 USC 4975.

EMPLOYEE STOCK OWNERSHIP PLAN.—The first Sentence of paragraph (8) of section 4975(e) (defining qualifying employer security) is amended to read as follows: "The term 'qualifying employer security' means any employer security within the meaning of section 409 A(l)." (D) NONRECOGNITION OF GAIN ON CONTRIBUTION TO TAX CREDIT EMPLOYEE STOCK OWNERSHIP PLAN.—Subsection (m) o f

26 USC 409A.

section 409A (relating to contributions of stock of controlling corporation) is amended to read as follows: "(m) NoNRECOGNITION OF G A I N OR LoSS ON CONTRIBUTION OF EMPLOYER SECURITIES TO TAX CREDIT EMPLOYEE STOCK OWNERSHIP

PLAN.—No gain or loss shall be recognized to the taxpayer with respect to the transfer of employer securities to a tax credit employee stock ownership plan maintained by the taxpayer to the extent that such transfer is required under subparagraph (A) or (B) of section 48(n)(l)." (E) SECTION 4975 EMPLOYEE STOCK OWNERSHIP PLANS MAY DISTRIBUTE CASH IN CERTAIN CASES.—Paragraph (2) of section

409A(h) (relating to allowing plan to distribute cash in certain cases) is amended by inserting "or of section 4975(e)(7)" after "the requirements of this section". (F) MATCHED EMPLOYER AND EMPLOYEE CONTRIBUTIONS MUST STAY IN PLAN.—Subsection (d) of section 409A (relating

to employer securities must stay in plan) is amended by inserting "(or allocated to a participant's account in connection with matched employer and employee contributions)" after "under subsection (b)", (G) LIMITATION ON REQUIRED TRANSFERS FOR MATCHING EMPLOYEES PLAN PERCENTAGE.—ClaUSe (i) of Section

26 USC 48.

48(n)(l)(B) (relating to matching percentage) is amended to read as follows: "(i) to make transfers of employer securities to a tax credit employee stock ownership plan maintained by the employer having an aggregate value equal to the lesser of— "(I) the sum of the qualified matching employee contributions made to such plan for the taxable year, or "(II) one-half of 1 percent of the amount of the qualified investment (as determined under subsections (c) and (d) of section 46) for the taxable year, and". (H) TIME FOR MAKING TRANSFERS ATTRIBUTABLE TO QUALIFIED MATCHING EMPLOYEE CONTRIBUTIONS.—The last Sen-

tence of section 48(n)(l)(C) (relating to times for making transfers) is amended by inserting before the period at the end thereof the following: "(including where such excess is attributable to qualified matching employee contributions made after the close of the taxable year)".

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