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(1) In general
In the case of a plan of an eligible employer providing for a deferral of compensation, if such plan is not an eligible deferred compensation plan, then—
(A) the compensation shall be included in the gross income of the participant or beneficiary for the 1st taxable year in which there is no substantial risk of forfeiture of the rights to such compensation, and
(B) the tax treatment of any amount made available under the plan to a participant or beneficiary shall be determined under section 72 (relating to annuities, etc.).
the compensation shall be included in the gross income of the participant or beneficiary for the 1st taxable year in which there is no substantial risk of forfeiture of the rights to such compensation, and
the tax treatment of any amount made available under the plan to a participant or beneficiary shall be determined under section 72 (relating to annuities, etc.).
Paragraph (1) shall not apply to—
(A) a plan described in section 401(a) which includes a trust exempt from tax under section 501(a),
(B) an annuity plan or contract described in section 403,
(C) that portion of any plan which consists of a transfer of property described in section 83,
(D) that portion of any plan which consists of a trust to which section 402(b) applies,
(E) a qualified governmental excess benefit arrangement described in section 415(m), and
(F) that portion of any applicable employment retention plan described in paragraph (4) with respect to any participant.
a plan described in section 401(a) which includes a trust exempt from tax under section 501(a),
an annuity plan or contract described in section 403,
that portion of any plan which consists of a transfer of property described in section 83,
that portion of any plan which consists of a trust to which section 402(b) applies,
a qualified governmental excess benefit arrangement described in section 415(m), and
that portion of any applicable employment retention plan described in paragraph (4) with respect to any participant.
For purposes of this subsection—
(A) Plan includes arrangements, etc. The term “plan” includes any agreement or arrangement.
(B) Substantial risk of forfeiture The rights of a person to compensation are subject to a substantial risk of forfeiture if such person’s rights to such compensation are conditioned upon the future performance of substantial services by any individual.
The term “plan” includes any agreement or arrangement.
The rights of a person to compensation are subject to a substantial risk of forfeiture if such person’s rights to such compensation are conditioned upon the future performance of substantial services by any individual.
For purposes of paragraph (2)(F)—
(A) In general The portion of an applicable employment retention plan described in this paragraph with respect to any participant is that portion of the plan which provides benefits payable to the participant not in excess of twice the applicable dollar limit determined under subsection (e)(15).
(B) Other rules (i) Limitation Paragraph (2)(F) shall only apply to the portion of the plan described in subparagraph (A) for years preceding the year in which such portion is paid or otherwise made available to the participant. (ii) Treatment A plan shall not be treated for purposes of this title as providing for the deferral of compensation for any year with respect to the portion of the plan described in subparagraph (A).
(C) Applicable employment retention plan The term “applicable employment retention plan” means an employment retention plan maintained by— (i) a local educational agency (as defined in section 8101 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7801 )), or (ii) an education association which principally represents employees of 1 or more agencies described in clause (i) and which is described in section 501(c)(5) or (6) and exempt from taxation under section 501(a).
(D) Employment retention plan The term “employment retention plan” means a plan to pay, upon termination of employment, compensation to an employee of a local educational agency or education association described in subparagraph (C) for purposes of— (i) retaining the services of the employee, or (ii) rewarding such employee for the employee’s service with 1 or more such agencies or associations.
The portion of an applicable employment retention plan described in this paragraph with respect to any participant is that portion of the plan which provides benefits payable to the participant not in excess of twice the applicable dollar limit determined under subsection (e)(15).
(i) Limitation Paragraph (2)(F) shall only apply to the portion of the plan described in subparagraph (A) for years preceding the year in which such portion is paid or otherwise made available to the participant.
(ii) Treatment A plan shall not be treated for purposes of this title as providing for the deferral of compensation for any year with respect to the portion of the plan described in subparagraph (A).
Paragraph (2)(F) shall only apply to the portion of the plan described in subparagraph (A) for years preceding the year in which such portion is paid or otherwise made available to the participant.
A plan shall not be treated for purposes of this title as providing for the deferral of compensation for any year with respect to the portion of the plan described in subparagraph (A).
The term “applicable employment retention plan” means an employment retention plan maintained by—
(i) a local educational agency (as defined in section 8101 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7801 )), or
(ii) an education association which principally represents employees of 1 or more agencies described in clause (i) and which is described in section 501(c)(5) or (6) and exempt from taxation under section 501(a).
a local educational agency (as defined in section 8101 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7801 )), or
an education association which principally represents employees of 1 or more agencies described in clause (i) and which is described in section 501(c)(5) or (6) and exempt from taxation under section 501(a).
The term “employment retention plan” means a plan to pay, upon termination of employment, compensation to an employee of a local educational agency or education association described in subparagraph (C) for purposes of—
(i) retaining the services of the employee, or
(ii) rewarding such employee for the employee’s service with 1 or more such agencies or associations.
retaining the services of the employee, or
rewarding such employee for the employee’s service with 1 or more such agencies or associations.