In the case of an employer to whom an election under this section applies for any calendar year, there is hereby imposed a tax for such calendar year equal to 30 percent of the excess fringe benefits.
(b) Excess fringe benefits
For purposes of subsection (a), the term “excess fringe benefits” means, with respect to any calendar year—
(1)the aggregate value of the fringe benefits provided by the employer during the calendar year which were not includible in gross income under paragraphs (1) and (2) of section
(2)1 percent of the aggregate amount of compensation—
(A)which was paid by the employer during such calendar year to employees, and
(B)was includible in gross income for purposes of chapter 1.
(c) Effect of election on section
(1)an election under this section is in effect with respect to an employer for any calendar year, and
(2)at all times on or after January 1, 1984, and before the close of the calendar year involved, substantially all of the employees of the employer were entitled to employee discounts on goods or services provided by the employer in 1 line of business,
for purposes of paragraphs (1) and (2) of section
132(a) (but not for purposes of section
132(h)), all employees of any line of business of the employer which was in existence on January 1, 1984, shall be treated as employees of the line of business referred to in paragraph (2).
(d) Period of election
An election under this section shall apply to the calendar year for which made and all subsequent calendar years unless revoked by the employer.
(e) Treatment of controlled groups
All employees treated as employed by a single employer under subsection (b), (c), or (m) ofsection
414 shall be treated as employed by a single employer for purposes of this section.
(f) Section to apply only to employment within the United States
Except as otherwise provided in regulations, this section shall apply only with respect to employment within the United States.
1986—Subsec. (c)(2). Pub. L. 99–514, § 1853(c)(1), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “as of January 1, 1984, substantially all of the employees of the employer were entitled to employee discounts or services provided by the employer in 1 line of business,”.
Amendment by Pub. L. 103–66applicable to reimbursements or other payments in respect of expenses incurred after Dec. 31, 1993, see section 13213(e) ofPub. L. 103–66, set out as a note under section
62 of this title.
Effective Date of 1986 Amendment
Amendment by Pub. L. 99–514effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 ofPub. L. 99–514, set out as a note under section
48 of this title.
Section effective Jan. 1, 1985, see section 531(h) ofPub. L. 98–369, set out as a note under section
132 of this title.
Plan Amendments Not Required Until January 1, 1989
For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and
1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. 99–514require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 ofPub. L. 99–514, as amended, set out as a note under section
401 of this title.
Application of Subsection (c) of this Section to Agricultural Cooperatives Incorporated in 1964
Pub. L. 99–514, title XVIII, § 1853(c)(3),Oct. 22, 1986, 100 Stat. 2871, provided that: “For purposes of determining whether the requirements of section 4977(c) of the Internal Revenue Code of 1954 [now 1986] are met in the case of an agricultural cooperative incorporated in 1964, there shall not be taken into account employees of a member of the same controlled group as such cooperative which became a member during July 1980.”
The table below lists the classification updates, since Jan. 3, 2012, for this section. Updates to a broader range of sections may be found at the update page for containing chapter, title, etc.
The most recent Classification Table update that we have noticed was Tuesday, August 13, 2013
An empty table indicates that we see no relevant changes listed in the classification tables. If you suspect that our system may be missing something, please double-check with the Office of the Law Revision Counsel.
Description of Change
Statutes at Large
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