Page:United States Statutes at Large Volume 95.djvu/311

 PUBLIC LAW 97-34—AUG. 13, 1981

95 STAT. 285

"(O QUALIFIED DISTRIBUTION.—The term 'qualified distribution' means any distribution of an excess contribution which meets requirements similar to the requirements of subparagraphs (A), (B), and (C) of section 408(d)(4). In the case of such a distribution, the rules of the last sentence of section 408(d)(4) shall apply." (2) Paragraph (4) of section 401(d) (relating to additional 26 USC 40i. requirements for qualification of trusts and plans benefiting owner-employees) is amended by adding at the end thereof the following new sentence: "Subparagraph (B) shall not apply to any distribution to which section 72(m)(9) applies." Ante, p. 283. (3) Subsection (b) of section 4972 (defining excess contributions) 26 USC 4972. is amended by adding at the end thereof the following new paragraph: "(6) EXCESS CONTRIBUTIONS RETURNED BEFORE DUE DATE.—For

purposes of this subsection, any contribution which is distributed in a distribution to which section 72(m)(9) applies shall be treated as an amount not contributed." (f) EFFECTIVE DATE.— 26 USC 72 note. (1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by tms section shall apply to plans which include employees within the meaning of section 401(c)(l) with respect to taxable years beginning after December 31, 1981. (2) TRANSITIONAL RULE.—The amendments made by subsection (d) shall not apply to any loan from a plan to a self-employed individual who is an employee within the meaning of section 401(c)(l) which is outstanding on December 31, 1981. For purposes of the preceding sentence, any loan which is renegotiated, extended, renewed, or revised after such date shall be treated as a new loan. SEC. 313. ROLLOVERS UNDER BOND PURCHASE PLANS. (a) GENERAL RULE.—Subsection (d) of section 405 (relating to 26use405. taxability of beneficiary of qualified bond purchase plan) is amended by adding at the end thereof the following new paragraph: "(3) ROLLOVER INTO AN INDIVIDUAL RETIREMENT ACCOUNT OR ANNUITY.— "(A) IN GENERAL.—If—

"(i) any qualified bond is redeemed, "(ii) any portion of the excess of the proceeds from such redemption over the basis of such bond is transferred to an individual retirement plan which is maintained for the benefit of the individual redeenung such bond, and "(iii) such transfer is made on or before the 60th day after the day on which the individual received the proceeds of such redemption, then, gross income shall not include the proceeds to the extent so transferred and the transfer shall be treated as a rollover contribution described in section 408(d)(3). "(B) QUALIFIED BOND.—For purposes of this paragraph, the term 'qualified bond' means any bond described m subsection (b) which is distributed under a qualifi^ bond purchase plan or from a trust described in section 401(a) which is exempt fh)m tax under section 501(a)." Oi)) TECHNICAL AMENDMENTS.—

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