TRANSITIONAL RULES IN CASE OF NONPROFIT ORGANIZATIONS.

SEC. 122. TRANSITIONAL RULES IN CASE OF NONPROFIT ORGANIZATIONS. (a) Credit for Prior Contributions.—Section 3303 of the Internal Revenue Code of 1954 (relating to conditions of additional credit allowance) is amended by adding at the end thereof the following new subsection: “(g) Transitional Rule for Unemployment Compensation Amendments of 1976.— To facilitate the orderly transition to coverage of service to which section 3309(a)(1)(A) applies by reason of the enactment of the Unemployment Compensation Amendments of 1976, a State law may provide that an organization (or group of organizations) which elects, when such election first becomes available under the State law with respect to such service, to make payments (in lieu of contributions) into the State unemployment fund as provided in section 3309(a)(2), and which bad paid contributions into such fund under the State law with respect to such service performed in its employ before the date of the enactment of this subsection, is not90 STAT. 2676 required to make any such payment (in lieu of contributions) on account of compensation paid after its election as heretofore described which is attributable under the State law to such service performed in its employ, until the total of such compensation equals the amount— “(1) by which the contributions paid by such organization (or group) on the basis of wages for such service with respect to a period before the election provided by section 3309(a) (2), exceed “(2) the unemployment compensation for the same period which was charged to the experiencerati ng account of such organization (or group) or paid under the State law on the basis of such service performed in its employ or wages paid for such service, whichever is appropriate.”. (b) Technical Amendment.—Section 3303(f) of such Code (relating to transition to coverage of certain services) is amended by striking out “which elects, when such election first becomes available under the State law,” and inserting in lieu thereof “which elects before April 1, 1972,”. (c) Effective Dates.—The amendment made by subsection (a) shall take effect on the date of the enactment of this Act. The amendment. made by subsection (b) shall take effect on January 1, 1970.