12 2 STA T . 1 640PUBLIC LA W 110 – 24 5—J U NE 1 7, 200 8‘ ‘ (5)WAIVEROFC ER T AI N RI GH T S.—Noel e cti o nmayb ema d e u nde rp ara g rap h ( 1 ) unle s stheta x payer ma k es an irre v ocable w aiver o f any right under any treaty of the U nited S tates which would preclude assessment or collection of any tax imposed by reason of this section. ‘‘( 6 ) EL ECTIONS.— A n election under paragraph (1) shall only apply to property described in the election and , once made, is irrevocable. ‘‘( 7 ) I NTEREST.— F or purposes of section 66 0 1, the last date for the payment of tax shall be determined without regard to the election under this subsection. ‘‘(c) E X CE P TION FOR C ERTAIN P ROPERT Y .—Subsection (a) shall not apply to— ‘‘(1) any deferred compensation item (as defined in sub - section (d)( 4 )), ‘‘( 2 ) any specified tax deferred account (as defined in sub- section (e)(2)), and ‘‘( 3 ) any interest in a nongrantor trust (as defined in sub- section (f)(3)). ‘‘(d) T REAT M ENT OF D EFERRE D COMPENSATION ITEMS.— ‘‘(1) WITHHOLDING ON ELIGI B LE DEFERRED COMPENSATION ITEMS.— ‘‘(A) IN GENERAL.—In the case of any eligible deferred compensation item, the payor shall deduct and withhold from any taxable payment to a covered expatriate with respect to such item a tax e q ual to 30 percent thereof. ‘‘( B ) TAXABLE PAYMENT.—For purposes of subparagraph (A), the term ‘taxable payment ’ means with respect to a covered expatriate any payment to the extent it would be includible in the gross income of the covered expatriate if such expatriate continued to be sub j ecttotaxasa citi z en or resident of the United States. A deferred com- pensation item shall be taken into account as a payment under the preceding sentence when such item would be so includible. ‘‘(2) O THER DEFERRED COMPENSATION ITEMS.—In the case of any deferred compensation item which is not an eligible deferred compensation item— ‘‘(A)(i) with respect to any deferred compensation item to which clause (ii) does not apply, an amount equal to the present value of the covered expatriate’s accrued benefit shall be treated as having been received by such individual on the day before the expatriation date as a distribution under the plan, and ‘‘(ii) with respect to any deferred compensation item referred to in paragraph (4)(D), the rights of the covered expatriate to such item shall be treated as becoming transferable and not subject to a substantial risk of for- feiture on the day before the expatriation date, ‘‘(B) no early distribution tax shall apply by reason of such treatment, and ‘‘(C) appropriate adjustments shall be made to subse- quent distributions from the plan to reflect such treatment. ‘‘(3) ELIGIBLE DEFERRED COMPENSATION ITEMS.—For pur- poses of this subsection, the term ‘eligible deferred compensa- tion item’ means any deferred compensation item with respect to which— Ap p licab ili ty.
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