102 STAT. 3476

PUBLIC LAW 100-647—NOV. 10, 1988

26 USC 72 note.
26 USC 72 note.
26 USC 402 note.
Handicapped
persons.

(6)	Section 72(qX2) of the 1986 Code (relating to subsection not
to apply to certain dispositions) is amended by inserting alter
subparagraph (G) the following new subparagraph:
"(H) to which subsection (t) applies (without regard to
paragraph (2) thereof),".
 (7)	Subparagraph CD) of section 72(qX2) and clause (iv) of
section 72(tX2XA) of the 1986 Code are each amended by insert-
ing "designated" before '^beneficiary".
 (8)	Paragraph (2) of section 72(o) of the 1986 Code (relating to
additional tax if amount received before age 59%) is hereby
repealed.
 (9)	Subparagraph (D of section 402(eX4) of the 1986 Code is
amended by striking out "clause (ii) of.
(10)	Section 26(bX2) of the 1986 Code is amended—
 (A)	by striking out ", (oX2)," in subparagraph (Q, and
 (B)	by striking out "408(0 (relating to additional tax on
income from certain retirement accounts)" in subparagraph
(D) and inserting in lieu thereof "72(t) (relating to 10-
percent additional tax on early distributions from qualified
retirement plans)".
(11)	Section 1123(eX2) of the Reform Act is amended—
 (A)	by striking out "taxable", and
 (B)	by inserting ", but only with respect to distributions
from contracts described in section 403(b) of the Internal
Revenue Code of 1986 which are attributable to assets other
than assets held as of the close of the last year beginning
before January 1,1989" after "1988".
(12)	Section 1123(e) of the Reform Act is amended by adding at
the end thereof the following new paragraph:
"(5) special rule for distributions under an annuity con-
tract.—The amendments made by paragraphs (1), (2), and (3) of
subsection (b) shall not apply to any distribution under an
annuity contract if—
"(A) as of March 1, 1986, payments were being made
under such contract pursuant to a written election provid-
ing a specific schedule for the distribution of the taxpayer's
interest in such contract, and
"(B) such distribution is made pursuant to such written
election."
(13)	Section 72(t) of the 1986 Code shall apply to any distribu-
tion without regard to whether such distribution is made with-
out the consent of the participant pursuant to section 411(aXH)
or section 417(e) of the 1986 Code.
(d) amendments related to section 1124 of the reform act.—
(1)	Section 1124(a) of the Reform Act is amended to read as
follows:
"(a) in general.—If an employee dies, separates from service, or
becomes disabled before 1987 and an individual, trust, or estate
receives a lump-sum distribution with respect to such employee
after December 31, 1986, and before March 16, 1987, on account of
such death, separation from service, or disability, then, for purposes
of the Internal Revenue Code of 1986, such individual, estate, or
trust may treat such distribution as if it were received in 1986."
(2)	Section 1124(W of the Reform Act is amended—
(A) by striking out "employee" each place it appears and
inserting in lieu thereof "individual, estate, or trust", and