September 2, 1974 - 165 Pub. Law 93-406 employee was permitted to elect to receive part of his compensation in one or more alternative forms if one of such forms results in the inclusion of amounts in income under the Internal Revenue Code of 1954. (c) ADMINISTRATION OF LAW WITH RESPECT TO CERTAIN PLANS.(1) ADMINISTRATION IN THE CASE OF PLANS DESCRIBED IN SUBSECTION (b).-Until salary reduction regulations have been issued in final form, the law with respect to plans or arrangements described in subsection (b) shall be administered— (A) without regard to the proposed salary reduction regulations (37 FR 25938) and without regard to any other proposed salary reduction regulations, and (B) in the manner in which such law was administered before January 1, 1972. (2) ADMINISTRATION IN THE CASE OF QUALIFIED PROFIT-SHARING PLANS.-In the case of plans or arrangements described in subsection (b), in applying this section to the tax treatment of contributions to qualified profit-sharing plans where the contributed amounts are distributable only after a period of deferral, the law shall be administered in a manner consistent with and (A) Revenue Ruling 56-497 (1956–2 C.B. 284), (B) Revenue Ruling 63-180 (1963-2 C.B. 189), (C) Revenue Ruling 68-89 (1968-1 C.B. 402). (d) LIMITATION ON RETROACTIVITY OF FINAL REGULATIONS.-In the case of any salary reduction regulations which become final after December 31, 1976— 88 STAT. 993 (1) for purposes of chapter 1 of the Internal Revenue Code of 1954 (relating to normal taxes and surtaxes), such regulations 26 USC 1. shall not apply before January 1, 1977; and (2) for purposes of chapter 21 of such Code (relating to Fed eral Insurance Contributions Act) and for purposes of chapter 24 26 USC 3101. of such Code (relating to collection of income tax at source on 26 USC 3401. wages), such regulations shall not apply before the day on which such regulations are issued in final form. (e) SALARY REDUCTION REGULATIONS DEFINED.-For purposes of this section, the term "salary reduction regulations" means regulations dealing with the includibility in gross income (at the time of contribution) of amounts contributed to a plan which includes a trust that qualifies under section 401(a), or a plan described in section 403 (a) 26 USC 401. or 405 (a), including plans or arrangements described in subsection (b) (2), if the contribution is made under an arrangement under which the contribution will be made only if the employee elects to receive a reduction in his compensation or to forego an increase in his compensation, or under an arrangement under which the employee is permitted to elect to receive part of his compensation in one or more alternative forms (if one of such forms results in the inclusion of amounts in income under the Internal Revenue Code of 1954). SEC. 2008. CERTAIN ARMED FORCES SURVIVOR ANNUITIES. 26 USC 1 et seq. (a) TREATMENT OF CERTAIN PARTICIPANTS IN THE PLAN.-Section 404 (c) (relating to certain negotiated plans) is amended by inserting 26 USC 404. after the first sentence the following new sentences: "For purposes of this chapter and subtitle B, in the case of any individual who before July 1, 1974, was a participant in a plan described in the preceding sentence 88 STAT. 994 26 USC 401. 26 USC 404 note. 10 USC 1431. Ante, p. 991. 26 USC 122 note. Pub. Law 93-406 166 September 2, 1974 "(A) such individual, if he is or was an employee within the meaning of section 401 (c) (1), shall be treated (with respect to service covered by the plan) as being an employee other than an employee within the meaning of section 401(c)(1) and as being an employee of a participating employer under the plan, "(B) earnings derived from service covered by the plan shall be treated as not being earned income within the meaning of section 401 (c) (2), and "(C) such individual shall be treated as an employee of a participating employer under the plan with respect to service before July 1, 1975, covered by the plan. Section 277 (relating to deductions incurred by certain membership organizations in transactions with members) does not apply to any trust described in this subsection.". (b) OTHER AMENDMENTS TO SECTION 404 (c) (1).— (1) Paragraph (1) of the first sentence of section 404 (c) is amended by striking out "and pensions" and inserting in lieu thereof "or pensions". (2) The last sentence of section 404 (c) is amended by striking out "This subsection" and inserting in lieu thereof "The first and third sentences of this subsection". (c) EFFECTIVE DATE.-The amendments made by this section shall apply to taxable years ending on or after June 30, 1972. SEC. 2007. RULES FOR CERTAIN NEGOTIATED PLANS. (a) IN GENERAL.-Section 122 (a) (relating to certain reduced uniformed services retired pay) is amended to read as follows: "(a) GENERAL RULE.-In the case of a member or former member of the uniformed services of the United States, gross income does not include the amount of any reduction in his retired or retainer pay pursuant to the provisions of chapter 73 of title 10, United States Code.". (b) TECHNICAL AMENDMENTS. (1) Section 122(b) (2) is amended by striking out "section 1438" in subparagraph (B) and inserting in lieu thereof "section 1438 or 1452(d)". (2) Section 72 (o) is amended by inserting after "Plan" in the heading of such section "or Survivor Benefit Plan". (3) Section 101 (b) (2) (D) is amended by striking out "if the individual who made the election under such chapter" and inserting in lieu thereof "if the member or former member of the uniformed services by reason of whose death such annuity is payable". (4) Section 2039 (c) is amended by striking out "section 1438" in the last sentence and inserting in lieu thereof "section 1438 or 1452(d)". (c) EFFECTIVE DATES.-The amendments made by this section apply to taxable years ending on or after September 21, 1972. The amendments made by paragraphs (3) and (4) of subsection (b) apply with respect to individuals dying on or after such date. September 2, 1974 - 167 Pub. Law 93-406 88 STAT. 995 TITLE III-JURISDICTION, ADMINISTRA- Subtitle A-Jurisdiction, Administration, and Enforcement PROCEDURES IN CONNECTION WITH THE ISSUANCE OF CERTAIN DETERMINA- SEC. 3001. (a) Before issuing an advance determination of whether 29 USC 1201. a pension, profit-sharing, or stock bonus plan, a trust which is a part of such a plan, or an annuity or bond purchase plan meets the requirements of part I of subchapter D of chapter 1 of the Internal Revenue Code of 1954, the Secretary of the Treasury shall require the person 26 USC 401. applying for the determination to provide, in addition to any material and information necessary for such determination, such other material and information as may reasonably be made available at the time such application is made as the Secretary of Labor may require under title I of this Act for the administration of that title. The Secretary of Ante, p. 832. the Treasury shall also require that the applicant provide evidence satisfactory to the Secretary that the applicant has notified each employee who qualifies as an interested party (within the meaning of regulations prescribed under section 7476 (b) (1) of such Code (relat- Ante, p. 949. ing to declaratory judgments in connection with the qualification of certain retirement plans)) of the application for a determination. (b) (1) Whenever an application is made to the Secretary of the Treasury for a determination of whether a pension, profit-sharing, or stock bonus plan, a trust which is a part of such a plan, or an annuity or bond purchase plan meets the requirements of part I of subchapter D of chapter 1 of the Internal Revenue Code of 1954, the Secretary shall upon request afford an opportunity to comment on the application at any time within 45 days after receipt thereof to (A) any employee or class of employee qualifying as an interested party within the meaning of the regulations referred to in subsection (a). (B) the Secretary of Labor, and (C) the Pension Benefit Guaranty Corporation. (2) The Secretary of Labor may not request an opportunity to comment upon such an application unless he has been requested in writing to do so by the Pension Benefit Guaranty Corporation or by the lesser of (A) 10 employees, or (B) 10 percent of the employees who qualify as interested parties within the meaning of the regulations referred to in subsection (a). Upon receiving such a request, the Secretary of Labor shall furnish a copy of the request to the Secretary of the Treasury within 5 days (excluding Saturdays, Sundays, and legal public holidays (as set forth in section 6103 of title 5, United States Code)). 80 Stat. 515; (3) Upon receiving such a request from the Secretary of Labor, 82 Stat. 250. the Secretary of the Treasury shall furnish to the Secretary of Labor such information held by the Secretary of the Treasury relating to the application as the Secretary of Labor may request. (4) The Secretary of Labor shall, within 30 days after receiving a request from the Pension Benefit Guaranty Corporation or from the 88 STAT. 996 Pub. Law 93-406 168 September 2, 1974 necessary number of employees who qualify as interested parties, notify the Secretary of the Treasury, the Pension Benefit Guaranty Corporation, and such employees with respect to whether he is going to comment on the application to which the request relates and with respect to any matters raised in such request on which he is not going to comment. If the Secretary of Labor indicates in the notice required under the preceding sentence that he is not going to comment on all or part of the matters raised in such request, the Secretary of the Treasury shall afford the corporation, and such employees, an opportunity to comment on the application with respect to any matter on which the Secretary of Labor has declined to comment. (c) The Pension Benefit Guaranty Corporation and, upon petition of a group of employees referred to in subsection (b) (2), the Secretary of Labor, may intervene in any action brought for declaratory judg Ante, p. 949. ment under section 7476 of the Internal Revenue Code of 1954 in accordance with the provisions of such section. The Pension Benefit Guaranty Corporation is permitted to bring an action under such section 7476 under such rules as may be prescribed by the United States Tax Court. 26 USC 401. (d) If the Secretary of the Treasury determines that a plan or trust to which this section applies meets the applicable requirements of part I of subchapter D of chapter 1 of the Internal Revenue Code of 1954 and issues a determination letter to the applicant, the Secretary shall notify the Secretary of Labor of his determination and furnish such information and material relating to the application and determination held by the Secretary of the Treasury as the Secretary of Labor Ante, p. 832. may request for the proper administration of title I of this Act. The Secretary of Labor shall accept the determination of the Secretary of the Treasury as prima facie evidence of initial compliance by the plan with the standards of parts 2, 3, and 4 of subtitle B of title I of this Act. If an application for such a determination is withdrawn, or if the Secretary of the Treasury issues a determination that the plan or trust does not meet the requirements of such part I, the Secretary shall notify the Secretary of Labor of the withdrawal or determination. Ante, p. 898. 29 USC 1202. (e) This section does not apply with respect to an application for any plan received by the Secretary of the Treasury before the date on which section 410 of the Internal Revenue Code of 1954 applies to the plan, or on which such section will apply if the plan is determined by the Secretary to be a qualified plan. PROCEDURES WITH RESPECT TO CONTINUED COMPLIANCE WITH REQUIRE- Src. 3002. (a) In carrying out the provisions of part I of subchapter D of chapter 1 of the Internal Revenue Code of 1954 with respect to whether a plan or a trust meets the requirements of section 410 (a) or Ante, p. 901. 411 of such Code (relating to minimum participation standards and 26 USC 1 et seq. minimum vesting standards, respectively), the Secretary of the Treasury shall notify the Secretary of Labor when the Secretary of the Treasury issues a preliminary notice of intent to disqualify related to the plan or trust or, if earlier, at the time of commencing any proceeding to determine whether the plan or trust satisfies such requirements. Unless the Secretary of the Treasury finds that the collection of a tax imposed under the Internal Revenue Code of 1954 is in jeopardy, the Secretary of the Treasury shall not issue a determination that the plan or trust does not satisfy the requirements of such section until 55-202 76 - 12 September 2, 1974 - 169 Pub. Law 93-406 88 STAT. 997 the expiration of a period of 60 days after the date on which he notifies the Secretary of Labor of such review. The Secretary of the Treasury, in his discretion, may extend the 60-day period referred to in the preceding sentence if he determines that such an extension would enable the Secretary of Labor to obtain compliance with such requirements by the plan within the extension period. Except as otherwise provided in this Act, the Secretary of Labor shall not generally apply Ante, p. 852. part 2 of title I of this Act to any plan or trust subject to sections 410(a) and 411 of such Code, but shall refer alleged general violations of the vesting or participation standards to the Secretary of the Treasury. (The preceding sentence shall not apply to matters relating to individuals benefits.) Ante, p. 898, 901. Notice of deficiency. Ante, p. 920. (b) Unless the Secretary of the Treasury finds that the collection of a tax is in jeopardy, in carrying out the provisions of section 4971 of the Internal Revenue Code of 1954 (relating to taxes on the failure to meet minimum funding standards), the Secretary of the Treasury shall notify the Secretary of Labor before sending a notice of deficiency with respect to any tax imposed under that section on an employer. and, in accordance with the provisions of subsection (d) of that section, afford the Secretary of Labor an opportunity to comment on the imposition of the tax in the case. The Secretary of the Treasury may Waiver. waive the imposition of the tax imposed under section 4971(b) of such Code in appropriate cases. Upon receiving a written request from the Secretary of Labor or from the Pension Benefit Guaranty Corporation, the Secretary of the Treasury shall cause an investigation to be commenced expeditiously with respect to whether the tax imposed under section 4971 of such Čode should be applied with respect to any employer to which the request relates. The Secretary of the Treasury and the Secretary of Labor shall consult with each other from time to time with respect to the provisions of section 412 of the Internal Revenue Code of 1954 (relating to minimum funding standards) and Ante, p. 914. with respect to the funding standards applicable under title I of this Act in order to coordinate the rules applicable under such standards. (c) Regulations prescribed by the Secretary of the Treasury ander sections 410(a), 411, and 412 of the Internal Revenue Code of 1954 (relating to minimum participation standards, minimum vesting standards, and minimum funding standards, respectively) shall also apply to the minimum participation, vesting, and funding standards set forth in parts 2 and 3 of subtitle B of title I of this Act. Except Ante, p. 852, as otherwise expressly provided in this Act, the Secretary of Labor shall not prescribe other regulations under such parts, or apply the regulations prescribed by the Secretary of the Treasury under sections 410(a), 411, 412 of the Internal Revenue Code of 1954 and applicable to the minimum participation, vesting, and funding standards under such parts in a manner inconsistent with the way such regulations apply under sections 410(a), 411, and 412 of such Code. (d) The Secretary of Labor and the Pension Benefit Guaranty Corporation, before filing briefs in any case involving the construction or application of minimum participation standards, minimum vesting standards, or minimum funding standards under title I of this Act, shall afford the Secretary of the Treasury a reasonable opportunity to review any such brief. The Secretary of the Treasury shall have the right to intervene in any such case. 868. Review of briefs. |