§1321 — Title 29 Labor | U.S. Code

Summary

Applies to employee pension plans set up or kept by employers or employee groups that do business across state lines, and to plans the Treasury Secretary has found meet certain federal tax rules. It does not apply to many specific kinds of plans, including individual account plans; plans run by the U.S. government or state and local governments; church plans that have not chosen to be covered; plans run by certain tax-exempt societies or trusts; plans that never had employer contributions after September 2, 1974; unfunded plans just for a select group of managers or highly paid employees; plans outside the United States for mostly nonresident aliens; parts of plans that pay benefits above tax limits; plans only for substantial owners; plans of certain international organizations; plans only for workers’ compensation, unemployment, or disability benefits; some defined benefit plans treated like individual account plans; and plans run by professional service employers that never had more than 25 active participants after September 2, 1974. Defined terms used here: individual account plan — a plan like a personal account plan, except one that promises a fixed benefit when the employer helped set that benefit; professional service employer — a business owned or controlled by professionals whose main work is providing professional services; professional individuals — examples are doctors, dentists, lawyers, accountants, architects, engineers, and performing artists; substantial owner — someone who, during the 60-month period before the decision, owns an entire unincorporated business, or more than 10 percent of a partnership’s capital or profits, or more than 10 percent in value of a corporation’s voting stock or all its stock.

Title 29, §1321

Labor — Source: USLM XML via OLRC

(a)Except as provided in subsection (b), this subchapter applies to any plan (including a successor plan) which, for a plan year—

(1)is an employee pension benefit plan (as defined in paragraph (2) of section 1002 of this title) established or maintained—

(A)by an employer engaged in commerce or in any industry or activity affecting commerce, or

(B)by any employee organization, or organization representing employees, engaged in commerce or in any industry or activity affecting commerce, or

(C)by both,

(2)is, or has been determined by the Secretary of the Treasury to be, a plan described in section 401(a) of title 26, or which meets, or has been determined by the Secretary of the Treasury to meet, the requirements of section 404(a)(2) of title 26.

(b)This section does not apply to any plan—

(1)which is an individual account plan, as defined in paragraph (34) of section 1002 of this title,11 So in original. The comma probably should be a semicolon.

(2)established and maintained for its employees by the Government of the United States, by the government of any State or political subdivision thereof, or by any agency or instrumentality of any of the foregoing, or to which the Railroad Retirement Act of 1935 or 1937 [45 U.S.C. 231 et seq.] applies and which is financed by contributions required under that Act, or which is described in the last sentence of section 1002(32) of this title 22 So in original. A semicolon probably should appear.

(3)which is a church plan as defined in section 414(e) of title 26, unless that plan has made an election under section 410(d) of title 26, and has notified the corporation in accordance with procedures prescribed by the corporation, that it wishes to have the provisions of this part 33 So in original. Subtitle B of title IV of Pub. L. 93–406, classified to this subtitle, does not contain parts. apply to it,1

(4)(A)established and maintained by a society, order, or association described in section 501(c)(8) or (9) of title 26, if no part of the contributions to or under the plan is made by employers of participants in the plan, or

(B)of which a trust described in section 501(c)(18) of title 26 is a part;

(5)which has not at any time after September 2, 1974, provided for employer contributions;

(6)which is unfunded and which is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees;

(7)which is established and maintained outside of the United States primarily for the benefit of individuals substantially all of whom are nonresident aliens;

(8)which is maintained by an employer solely for the purpose of providing benefits for certain employees in excess of the limitations on contributions and benefits imposed by section 415 of title 26 on plans to which that section applies, without regard to whether the plan is funded, and, to the extent that a separable part of a plan (as determined by the corporation) maintained by an employer is maintained for such purpose, that part shall be treated for purposes of this subchapter, as a separate plan which is an excess benefit plan;

(9)which is established and maintained exclusively for substantial owners;

(10)of an international organization which is exempt from taxation under the International Organizations Immunities Act [22 U.S.C. 288 et seq.];

(11)maintained solely for the purpose of complying with applicable workmen’s compensation laws or unemployment compensation or disability insurance laws;

(12)which is a defined benefit plan, to the extent that it is treated as an individual account plan under paragraph (35)(B) of section 1002 of this title; or

(13)established and maintained by a professional service employer which does not at any time after September 2, 1974, have more than 25 active participants in the plan.

(c)(1)For purposes of subsection (b)(1), the term “individual account plan” does not include a plan under which a fixed benefit is promised if the employer or his representative participated in the determination of that benefit.

(2)For purposes of this paragraph and for purposes of subsection (b)(13)—

(A)the term “professional service employer” means any proprietorship, partnership, corporation, or other association or organization (i) owned or controlled by professional individuals or by executors or administrators of professional individuals, (ii) the principal business of which is the performance of professional services, and

(B)the term “professional individuals” includes but is not limited to, physicians, dentists, chiropractors, osteopaths, optometrists, other licensed practitioners of the healing arts, attorneys at law, public accountants, public engineers, architects, draftsmen, actuaries, psychologists, social or physical scientists, and performing artists.

(3)In the case of a plan established and maintained by more than one professional service employer, the plan shall not be treated as a plan described in subsection (b)(13) if, at any time after September 2, 1974, the plan has more than 25 active participants.

(d)For purposes of subsection (b)(9), the term “substantial owner” means an individual who, at any time during the 60-month period ending on the date the determination is being made—

(1)owns the entire interest in an unincorporated trade or business,

(2)in the case of a partnership, is a partner who owns, directly or indirectly, more than 10 percent of either the capital interest or the profits interest in such partnership, or

(3)in the case of a corporation, owns, directly or indirectly, more than 10 percent in value of either the voting stock of that corporation or all the stock of that corporation.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The Railroad Retirement Act of 1935 or 1937, referred to in subsec. (b)(2), means act Aug. 29, 1935, ch. 812, 49 Stat. 967, known as the Railroad Retirement Act of 1935. The Railroad Retirement Act of 1935 was amended generally by act June 24, 1937, ch. 382, part I, 50 Stat. 307, and was known as the Railroad Retirement Act of 1937. The Railroad Retirement Act of 1937 was amended generally and redesignated the Railroad Retirement Act of 1974 by Pub. L. 93–445, title I, Oct. 16, 1974, 88 Stat. 1305, and is classified generally to subchapter IV (§ 231 et seq.) of chapter 9 of Title 45, Railroads. For complete classification of this Act to the Code, see Tables. The International Organizations Immunities Act, referred to in subsec. (b)(10), is title I of act Dec. 29, 1945, ch. 652, 59 Stat. 669, which is classified principally to subchapter XVIII (§ 288 et seq.) of chapter 7 of Title 22, Foreign Relations and Intercourse. For complete classification of this Act to the Code, see

Short Title

note set out under section 288 of Title 22 and Tables.

Amendments

2008—Subsec. (b)(14). Pub. L. 110–458 struck out par. (14) which read as follows: “established and maintained by an Indian tribal government (as defined in section 7701(a)(40) of title 26), a subdivision of an Indian tribal government (determined in accordance with section 7871(d) of title 26), or an agency or instrumentality of either, and all of the participants of which are employees of such entity substantially all of whose services as such an employee are in the performance of essential governmental functions but not in the performance of commercial activities (whether or not an essential government function).” 2006—Subsec. (b)(2). Pub. L. 109–280, § 906(a)(2)(B), inserted “or which is described in the last sentence of section 1002(32) of this title” at end. Subsec. (b)(9). Pub. L. 109–280, § 407(c)(1)(A), struck out “as defined in section 1322(b)(6) of this title” before semicolon at end. Subsec. (b)(14). Pub. L. 109–280, § 906(b)(2), added par. (14). Subsec. (d). Pub. L. 109–280, § 407(c)(1)(B), added subsec. (d). 1989—Subsec. (a). Pub. L. 101–239, § 7894(g)(3)(A), substituted “this subchapter applies” for “this section applies” in introductory provisions. Subsecs. (a)(1), (2), (b)(3), (4)(A), (8). Pub. L. 101–239, § 7891(a)(1), substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954”, which for purposes of codification was translated as “title 26” thus requiring no change in text. 1980—Subsec. (a). Pub. L. 96–364 inserted “unless otherwise specifically indicated in this subchapter,” after “For this purpose,”.

Statutory Notes and Related Subsidiaries

Effective Date

of 2008 AmendmentAmendment by Pub. L. 110–458 effective as if included in the provisions of Pub. L. 109–280 to which the amendment relates, except as otherwise provided, see section 112 of Pub. L. 110–458, set out as a note under section 72 of Title 26, Internal Revenue Code.

Effective Date

of 2006 Amendment Pub. L. 109–280, title IV, § 407(d), Aug. 17, 2006, 120 Stat. 931, provided that: “(1) In general.—Except as provided in paragraph (2), the

Amendments

made by this section [amending this section and section 1322, 1343, and 1344 of this title] shall apply to plan terminations—“(A) under section 4041(c) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1341(c)) with respect to which notices of intent to terminate are provided under section 4041(a)(2) of such Act (29 U.S.C. 1341(a)(2)) after December 31, 2005, and “(B) under section 4042 of such Act (29 U.S.C. 1342) with respect to which notices of determination are provided under such section after such date. “(2) Conforming

Amendments

.—The

Amendments

made by subsection (c) [amending this section and section 1343 of this title] shall take effect on January 1, 2006.” Amendment by section 906(a)(2)(B), (b)(2) of Pub. L. 109–280 applicable to any year beginning on or after Aug. 17, 2006, see section 906(c) of Pub. L. 109–280, set out as a note under section 414 of Title 26, Internal Revenue Code.

Effective Date

of 1989 AmendmentAmendment by section 7891(a)(1) of Pub. L. 101–239 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 7891(f) of Pub. L. 101–239, set out as a note under section 1002 of this title. Amendment by section 7894(g)(3)(A) of Pub. L. 101–239 effective, except as otherwise provided, as if originally included in the provision of the Employee Retirement Income Security Act of 1974, Pub. L. 93–406, to which such amendment relates, see section 7894(i) of Pub. L. 101–239, set out as a note under section 1002 of this title.

Effective Date

of 1980 AmendmentAmendment by Pub. L. 96–364 effective Sept. 26, 1980, except as specifically provided, see section 1461(e) of this title.

§1321 Coverage

Summary

Title 29, §1321

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