Us Code § 45AA - Military spouse retirement plan eligibility credit for small employers

§ 45AA. Military spouse retirement plan eligibility credit for small employers

(a) In general

For purposes of section 38, in the case of any eligible small employer, the military spouse retirement plan eligibility credit determined under this section for any taxable year is an amount equal to the sum of—

(1) $200 with respect to each military spouse who is an employee of such employer and who participates in an eligible defined contribution plan of such employer at any time during such taxable year, plus

(2) so much of the contributions made by such employer (other than an elective deferral (as defined in section 402(g)(3)) ¹ to all such plans with respect to such employee during such taxable year as do not exceed $300.

(b) Limitation

An individual shall only be taken into account as a military spouse under subsection (a) for the taxable year which includes the date on which such individual began participating in the eligible defined contribution plan of the employer and the 2 succeeding taxable years.

(c) Eligible small employer

For purposes of this section, the term "eligible small employer" means an eligible employer (as defined in section 408(p)(2)(C)(i)(I).²

(d) Military spouse

For purposes of this section—

(1) In general

The term "military spouse" means, with respect to any employer, any individual who is married (within the meaning of section 7703 as of the first date that the employee is employed by the employer) to an individual who is a member of the uniformed services (as defined section 101(a)(5) of title 10, United States Code) serving on active duty. For purposes of this section, an employer may rely on an employee's certification that such employee's spouse is a member of the uniformed services if such certification provides the name, rank, and service branch of such spouse.

(2) Exclusion of highly compensated employees

With respect to any employer, the term "military spouse" shall not include any individual if such individual is a highly compensated employee of such employer (within the meaning of section 414(q)).

(e) Eligible defined contribution plan

For purposes of this section, the term "eligible defined contribution plan" means, with respect to any eligible small employer, any defined contribution plan (as defined in section 414(i)) of such employer if, under the terms of such plan—

(1) military spouses employed by such employer are eligible to participate in such plan not later than the date which is 2 months after the date on which such individual begins employment with such employer, and

(2) military spouses who are eligible to participate in such plan—

(A) are immediately eligible to receive an amount of employer contributions under such plan which is not less the amount of such contributions that a similarly situated participant who is not a military spouse would be eligible to receive under such plan after 2 years of service, and

(B) immediately have a nonforfeitable right to the employee's accrued benefit derived from employer contributions under such plan.

(f) Aggregation rule

All persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 shall be treated as one employer for purposes of this section.

(Added Pub. L. 117–328, div. T, title I, §112(a), Dec. 29, 2022, 136 Stat. 5294.)

Statutory Notes and Related Subsidiaries

Effective Date

Section applicable to taxable years beginning after Dec. 29, 2022, see section 112(e) of Pub. L. 117–328, set out as an Effective Date of 2022 Amendment note under section 38 of this title.

¹ So in original. Probably should be followed by another closing parenthesis.

² So in original. Another closing parenthesis probably should precede the period.

Subpart E—Rules for Computing Investment Credit

        

Editorial Notes

Amendments

2022—Pub. L. 117–169, title I, §13702(b)(5), Aug. 16, 2022, 136 Stat. 1997, added item 48E.

Pub. L. 117–167, div. A, §107(d)(4), Aug. 9, 2022, 136 Stat. 1399, added item 48D.

2018—Pub. L. 115–141, div. U, title IV, §401(d)(3)(A), Mar. 23, 2018, 132 Stat. 1209, struck out item 48D "Qualifying therapeutic discovery project credit".

2010—Pub. L. 111–148, title IX, §9023(d), Mar. 23, 2010, 124 Stat. 881, added item 48D.

2009—Pub. L. 111–5, div. B, title I, §1302(c)(2), Feb. 17, 2009, 123 Stat. 348, added item 48C.

2005—Pub. L. 109–58, title XIII, §1307(c)(2), Aug. 8, 2005, 119 Stat. 1006, added items 48A and 48B.

2004—Pub. L. 108–357, title III, §322(d)(2)(C), Oct. 22, 2004, 118 Stat. 1475, which directed amendment of item 48 by striking out ", reforestation credit", was executed by striking out "; reforestation credit" after "Energy credit" to reflect the probable intent of Congress.

1990—Pub. L. 101–508, title XI, §11813(a), Nov. 5, 1990, 104 Stat. 1388–536, amended heading and analysis generally, substituting in heading "Investment Credit" for "Credit for Investment in Certain Depreciable Property", in item 47 "Rehabilitation Credit" for "Certain dispositions, etc., of section 38 property", in item 48 "Energy credit; reforestation credit" for "Definitions; special rules", in item 49 "At-risk rules" for "Termination of regular percentage", and adding item 50.

1986—Pub. L. 99–514, title II, §211(c), Oct. 22, 1986, 100 Stat. 2168, added item 49.

1984—Pub. L. 98–369, div. A, title IV, §474(n)(1), July 18, 1984, 98 Stat. 833, substituted "E" for "B" as subpart designation.

1978—Pub. L. 95–600, title III, §312(c)(5), Nov. 6, 1978, 92 Stat. 2826, struck out item 49 "Termination for period beginning April 19, 1969, and ending during 1971" and item 50 "Restoration of credit".

1971—Pub. L. 92–178, title I, §101(b)(5), Dec. 10, 1971, 85 Stat. 499, substituted "Termination for period beginning April 19, 1969, and ending during 1971" for "Termination of credit" in item 49 and added item 50.

1969—Pub. L. 91–172, title VII, §703(d), Dec. 30, 1969, 83 Stat. 667, added item 49.

1962—Pub. L. 87–834, §2(b), Oct. 16, 1962, 76 Stat. 963, added subpart B.