110 STAT. 1810 PUBLIC LAW 104-188—AUG. 20, 1996 exempt from tax under this chapter and which does not meet the requirements for quaHfication under section 401. " (3) QUALIFIED GOVERNMENTAL EXCESS BENEFIT ARRANGE- MENT. —For purposes of this subsection, the term 'quaHfied governmental excess benefit arrangement' means a portion of a governmental plan if— "(A) such portion is maintained solely for the purpose of providing to participants in the plan that part of the participant's annual benefit otherwise payable under the terms of the plan that exceeds the limitations on benefits imposed by this section, "(B) under such portion no election is provided at any time to the participant (directly or indirectly) to defer compensation, and "(C) benefits described in subparagraph (A) are not paid from a trust forming a part of such governmental plan unless such trust is maintained solely for the purpose of providing such benefits.". (2) COORDINATION WITH SECTION 457. — Subsection (e) of section 457 is amended by adding at the end the following new paragraph: " (14) TREATMENT OF QUALIFIED GOVERNMENTAL EXCESS BENEFIT ARRANGEMENTS.— Subsections (b)(2) and (c)(1) shall not apply to any qualified governmental excess benefit arrangement (as defined in section 415(m)(3)), and benefits provided under such an arrangement shall not be taken into account in determining whether any other plan is an eligible deferred compensation plan.". (3) CONFORMING AMENDMENT. —Paragraph (2) of section 457(f) is amended by striking "and" at the end of subparagraph (C), by striking the period at the end of subparagraph (D) and inserting ", and", and by inserting immediately thereafter the following new subparagraph: "(E) a qualified governmental excess benefit arrangement described in section 415(m).". (c) EXEMPTION FOR SURVIVOR AND DISABILITY BENEFITS. —Paragraph (2) of section 415(b) is amended by adding at the end the following new subparagraph: " (I) EXEMPTION FOR SURVIVOR AND DISABILITY BENEFITS PROVIDED UNDER GOVERNMENTAL PLANS. —Subparagraph (C) of this paragraph and paragraph (5) shall not apply to— "(i) income received from a governmental plan (as defined in section 414(d)) as a pension, annuity, or similar allowance as the result of the recipient becoming disabled by reason of personal injuries or sickness, or "(ii) amounts received from a governmental plan by the beneficiaries, survivors, or the estate of an employee as the result of the death of the employee.". (d) REVOCATION OF GRANDFATHER ELECTION.— (1) IN GENERAL.— Subparagraph (C) of section 415(b)(10) is amended by adding at the end the following new clause: "(ii) REVOCATION OF ELECTION.—An election under clause (i) may be revoked not later than the last day of the third plan year beginning after the date of the enactment of this clause. The revocation shall
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