PUBLIC LAW 109–280—AUG. 17, 2006
120 STAT. 1021
(1) Subparagraph (G) of section 401(a)(5) and subparagraph (G) of section 401(a)(26) of the Internal Revenue Code of 1986 are each amended by striking ‘‘section 414(d))’’ and all that follows and inserting ‘‘section 414(d)).’’. (2) Subparagraph (G) of section 401(k)(3) of such Code and paragraph (2) of section 1505(d) of the Taxpayer Relief Act of 1997 (Public Law 105–34; 111 Stat. 1063) are each amended by striking ‘‘maintained by a State or local government or political subdivision thereof (or agency or instrumentality thereof)’’. (b) CONFORMING AMENDMENTS.— (1) The heading of subparagraph (G) of section 401(a)(5) of the Internal Revenue Code of 1986 is amended by striking ‘‘STATE AND LOCAL GOVERNMENTAL’’ and inserting ‘‘GOVERNMENTAL’’. (2) The heading of subparagraph (G) of section 401(a)(26) of such Code is amended by striking ‘‘EXCEPTION FOR STATE AND LOCAL’’ and inserting ‘‘EXCEPTION FOR’’. (3) Section 401(k)(3)(G) of such Code is amended by inserting ‘‘GOVERNMENTAL PLAN.—’’ after ‘‘(G)’’. (c) EFFECTIVE DATE.—The amendments made by this section shall apply to any year beginning after the date of the enactment of this Act.
26 USC 401.
26 USC 401 and note.
SEC. 862. ELIMINATION OF AGGREGATE LIMIT FOR USAGE OF EXCESS FUNDS FROM BLACK LUNG DISABILITY TRUSTS.
(a) IN GENERAL.—So much of section 501(c)(21)(C) of the Internal Revenue Code of 1986 (relating to black lung disability trusts) as precedes the last sentence is amended to read as follows: ‘‘(C) Payments described in subparagraph (A)(i)(IV) may be made from such trust during a taxable year only to the extent that the aggregate amount of such payments during such taxable year does not exceed the excess (if any), as of the close of the preceding taxable year, of— ‘‘(i) the fair market value of the assets of the trust, over ‘‘(ii) 110 percent of the present value of the liability described in subparagraph (A)(i)(I) of such person.’’. (b) EFFECTIVE DATE.—The amendments made by this section shall apply to taxable years beginning after December 31, 2006.
26 USC 501 note.
SEC. 863. TREATMENT OF DEATH BENEFITS FROM CORPORATE-OWNED LIFE INSURANCE.
(a) IN GENERAL.—Section 101 of the Internal Revenue Code of 1986 (relating to certain death benefits) is amended by adding at the end the following new subsection: ‘‘(j) TREATMENT OF CERTAIN EMPLOYER-OWNED LIFE INSURANCE CONTRACTS.— ‘‘(1) GENERAL RULE.—In the case of an employer-owned life insurance contract, the amount excluded from gross income of an applicable policyholder by reason of paragraph (1) of subsection (a) shall not exceed an amount equal to the sum of the premiums and other amounts paid by the policyholder for the contract. ‘‘(2) EXCEPTIONS.—In the case of an employer-owned life insurance contract with respect to which the notice and consent requirements of paragraph (4) are met, paragraph (1) shall not apply to any of the following:
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