90 STAT. 1734
PUBLIC LAW 94-455—OCT. 4, 1976
TITLE XV—PENSION AND INSURANCE TAXATION
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SEC. 1501. RETIREMENT SAVINGS FOR CERTAIN MARRIED INDIVIDUALS. (a) ALLOWANCE OF DEDUCTION.—Part VII of subchapter B of chapa 4„; ter 1 (relating to additional itemized deductions for individuals) is
amended by redesignating section 220 as 221 and by inserting after section 219 the following new section: 26 USC 220. «SEC. 220. RETIREMENT SAVINGS FOR CERTAIN MARRIED INDIVIDUALS. "(a) DEDUCTION ALLOWED.—In the case of an individual, there is allowed as a deduction amounts paid in cash for a taxable year by or on behalf of such individual for the benefit of himself and his spouse— "(1) to an individual retirement account described in section 408(a), ~ *'"' ' "(2) for an individual retirement annuity described in section 408(b),or "(3) for a retirement bond described in section 409 (but only if the bond is not redeemed within 12 months of the date of its issuance). For purposes of this title, any amount paid by an employer to such a retirement account or for such a retirement annuity or retirement bond constitutes payment of compensation to the employee (other than a self-employed individual who is an employee within the meaning of section 401(c)(1)) includible in his gross income, whether or not a deduction for such payment is allowable under this section to the employee after the application of subsection (b). ^ J -.
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"(b) LIMITATIONS AND RESTRICTIONS.— "(1) MAXIMUM DEDUCTION.—The amount
allowable as a deduction under subsection (a) to an individual for any taxable year may not exceed— "(A) twice the amount paid to the account or annuity, or for the bond, established for the individual or for his spouse to or for which the lesser amount was paid for the taxable year, "(B) an amount equal to 15 percent of the compensation includible in the individual's gross income for the taxable year, or "(C) $1,750, whichever is the smallest amount. " (2) ALTERNATIVE DEDUCTION.—No deduction is allowed under subsection (a) for the taxable year if the individual claims the deduction allowed by section 219 for the taxable year.
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COVERAGE UNDER CERTAIN OTHER PLANS.—No deduction is
allowed under subsection (a) for an individual for the taxable year if for any part of such year— "(A.) he or his spouse was an active participant in— "(i) a plan described in section 401(a) which includes a trust exempt from tax under section 501(a), " (ii) an annuity plan described in section 403(a), " (iii) a qualified bond purchase plan described in sec- tion 405(a), or , -
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