PUBLIC LAW 100-647—NOV. 10, 1988

102 STAT. 3479

(A) by striking out "(by reason of the limitations of
section 415)", and

(B) by adding at the end thereof the following new
sentence:

"The amount allocated in the year of transfer shall not be
less than the lesser of the maximum amount allowable
under section 415 or % of the amount attributable to the
securities acquired."

(4) Subparagraph (B) of section 1132(cX2) of the Reform Act is 26 USC 4980
amended by striking out "November 19, 1978" and inserting in note.

lieu thereof "September 19,1978".

(5) Section 1132(c) of the Reform Act is amended by adding at
the end thereof the following new paragraph:

"(5) SPECIAL RULE FOR EMPLOYEE STOCK OWNERSHIP PLANS.—
Section 4980(cX3) of the Internal Revenue Code of 1986 (as added
by subsection (a)) shall apply to reversions occurring after
March 31,1985."

(6) Section 4980(cX3) of the 1986 Code is amended by adding at
the end thereof the following new subparagraphs:

"(F) No CREDIT OR DEDUCTION ALLOWED.—No credit or
deduction shall be allowed under chapter 1 for any amount
transferred to an employee stock ownership plan in a trans-
fer to which this paragraph applies.

"(G) AMOUNT TRANSFERRED TO INCLUDE INCOME THEREON,
ETC.—The amount transferred shall not be treated as meet-
ing the requirements of subparagraphs (B) and (C) unless
amounts attributable to such amount also meet such
requirements."

(7) Section 4980(cX3XC) of the 1986 Code is amended by adding
at the end thereof the following new sentence:

"In the case of dividends on securities held in the suspense
account, the requirements of this subparagraph are met
only if the dividends sure allocated to accounts of partici-
pants or paid to participants in proportion to their ac-
counts, or used to repay loans used to purchase employer
securities."
(g) AMENDMENTS RELATED TO SECTION 1133 OF THE REFORM ACT.— Retirement.

(1XA) Section 4981A of the 1986 Code (as added by section
1133 of the Reform Act) is redesignated as section 4980A.

(B) The table of sections for chapter 43 of the 1986 Code is
amended by redesignating section 4981A as section 4980A.

(2) Paragraph (1) of section 4980A(c) of the 1986 Code (as
redesignated by paragraph (1)) is amended by striking out
"$112,500 (adjusted at the same time and in the same manner as
under section 415(d))" and inserting in lieu thereof "the greater

"(A) $150,000, or

"(B) $112,500 (adjusted at the same time and in the same
manner as under section 415(d))."

(3) Section 4980A(cX2) of the 1986 Code (relating to exclusion
of certain distributions), as redesignated by paragraph (1), is
amended—

(A) by striking out "employee's" in subparagraph (Q and
inserting in lieu thereof "individual's", and

(B) by adding after subparagraph (D) the following new
subparagraphs: