98 STAT. 858
PUBLIC LAW 98-369—JULY 18, 1984 "(i) SHORT-TERM DISABILITY BENEFITS.—In the case of short-term disability benefits, the safe harbor limit for any taxable year is 17.5 percent of the qualified direct costs (other than insurance premiums) for the immediately preceding taxable year with respect to such benefits. "(ii) MEDICAL BENEFITS.—In the case of medical benefits, the safe harbor limit for any taxable year is 35 percent of the qualified direct costs (other than insurance premiums) for the immediately preceding taxable year with respect to medical benefits. "(iii) SUB OR SEVERANCE PAY BENEFITS.—In the case of SUB or severance pay benefits, the safe harbor limit for any taxable year is the amount determined under paragraph (3). "(iv) LONG-TERM DISABILITY OR LIFE INSURANCE BENE-
FITS.—In the case of any long-term disability benefit or life insurance benefit, the safe harbor limit for any taxable year shall be the amount prescribed by regulations. "(d) REQUIREMENT OF SEPARATE ACCOUNTS FOR POST RETIREMENT MEDICAL OR LIFE INSURANCE BENEFITS PROVIDED TO KEY EMPLOYEES.—
"(1) IN GENERAL.—In the case of any employee who is a key employee— "(A) a separate account shall be established for any medical benefits or life insurance benefits provided with respect to such employee after retirement, and "(B) medical benefits and life insurance benefits provided with respect to such employee after retirement may only be paid from such separate account. "(2) COORDINATION WITH SECTION 415.—For purposes of section
415, any amount attributable to medical benefits allocated to an account established under paragraph (1) shall be treated as an annual addition to a defined contribution plan for purposes of section 415(c). "(3) KEY EMPLOYEE.—For purposes of this section, the term 'key employee' means any employee who, at any time during the plan year or any preceding plan year, is or was a key employee as defined in section 416(i). "(e) SPECIAL LIMITATIONS ON RESERVES FOR MEDICAL BENEFITS OR LIFE INSURANCE BENEFITS PROVIDED TO RETIRED EMPLOYEES.— "(1) BENEFITS MUST BE NONDISCRIMINATORY.—No reserve may
Post, p. 864.
be taken into account under subsection (c)(2) for post-retirement medical benefits or life insurance benefits to be provided to covered employees unless the plan meets the requirements of section 505(b)(1) with respect to such benefits. "(2) TAXABLE U F E
INSURANCE BENEFITS NOT TAKEN INTO
ACCOUNT.—No life insurance benefit may be taken into account under subsection (c)(2) to the extent— "(A) such benefit is includible in gross income under section 79, or "(B) such benefit would be includible in gross income under section 101(b) (determined by substituting '$50,000' for '$5,000'). "(f) DEFINITIONS AND OTHER SPECIAL RULES.—For purposes of this section—
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