MODIFICATIONS OF SECTION 403(b).

SEC. 1450. MODIFICATIONS OF SECTION 403(b). (a) Multiple Salary Reduction Agreements Permitted.— (1) General rule.— For purposes of section 403(b) of the Internal Revenue Code of 1986, the frequency that an employee is permitted to enter into a salary reduction agreement, the salary to which such an agreement may apply, and the ability to revoke such an agreement shall be determined under the rules applicable to cash or deferred elections under section 401(k) of such Code. (2) Constructive receipt.— Section 402(e)(3) is amended by inserting “or which is part of a salary reduction agreement under section 403(b)” after “section 401(k)(2))”. (3) Effective date.— This subsection shall apply to taxable years beginning after December 31, 1995. (b) Treatment of Indian Tribal Governments.— (1) In general.— In the case of any contract purchased in a plan year beginning before January 1, 1995, section 403(b) of the Internal Revenue Code of 1986 shall be applied as if any reference to an employer described in section 501(c)(3) of the Internal Revenue Code of 1986 which is exempt from tax under section 501 of such Code included a reference to an employer which is an Indian tribal government (as defined by section 7701(a)(40) of such Code), a subdivision of an Indian tribal government (determined in accordance with section 7871(d) of such Code), an agency or instrumentality of an Indian tribal government or subdivision thereof, or a corporation110 STAT. 1815 chartered under Federal, State, or tribal law which is owned in whole or in part by any of the foregoing. (2) Rollovers.— Solely for purposes of applying section 403(b)(8) of such Code to a contract to which paragraph (1) applies, a qualified cash or deferred arrangement under section 401(k) of such Code shall be treated as if it were a plan or contract described in clause (ii) of section 403(b)(8)(A) of such Code. (c) Elective Deferrals.— (1) In general.— Subparagraph (E) of section 403(b)(1) is amended to read as follows: “(E) in the case of a contract purchased under a salary reduction agreement, the contract meets the requirements of section 401(a)(30),”. (2) Effective date.— The amendment made by this subsection shall apply to years beginning after December 31, 1995, except a contract shall not be required to meet any change in any requirement by reason of such amendment before the 90th day after the date of the enactment of this Act.