[Federal Register Volume 66, Number 118 (Tuesday, June 19, 2001)]
[Rules and Regulations]
[Pages 32897-32901]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-15255]


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DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[TD 8948]
RIN 1545-AY43


Minimum Cost Requirement Permitting the Transfer of Excess Assets 
of a Defined Benefit Pension Plan to a Retiree Health Account

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final regulations.

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SUMMARY: This document contains final Income Tax Regulations relating 
to the minimum cost requirement under section 420, which permits the 
transfer of excess assets of a defined benefit pension plan to a 
retiree health account. Pursuant to section 420(c)(3)(E), these 
regulations provide that an employer who significantly reduces retiree 
health coverage during the cost maintenance period does not satisfy the 
minimum cost requirement of section 420(c)(3). In addition, these 
regulations clarify the circumstances under which an employer is 
considered to have significantly reduced retiree health

[[Page 32898]]

coverage during the cost maintenance period.

DATES: Effective Date: These regulations are effective June 19, 2001.
    Applicability Date: These regulations are applicable to transfers 
of excess pension assets occurring on or after December 18, 1999. See 
the Effective Date portion of this preamble.

FOR FURTHER INFORMATION CONTACT: Janet A. Laufer or Vernon S. Carter, 
(202) 622-6060 (not a toll-free number).

SUPPLEMENTARY INFORMATION:

Background

    This document contains final regulations (26 CFR part 1) under 
section 420 of the Internal Revenue Code of 1986 (Code). These 
regulations provide guidance concerning the minimum cost requirement 
under section 420. The Revenue Reconciliation Act of 1990 (Public Law 
101-508) (104 Stat. 1388), section 12011, added section 420 of the 
Code, a temporary provision permitting certain qualified transfers of 
excess pension assets from a non-multiemployer defined benefit pension 
plan to a health benefits account. A health benefit account is defined 
as an account established and maintained under section 401(h) of the 
Code (401(h) account) that is part of the plan.\1\ One of the 
conditions of a qualified section 420 transfer was that the employer 
satisfy a maintenance of effort requirement in the form of a ``minimum 
cost requirement'' under which the employer was required to maintain 
employer-provided retiree health expenditures for covered retirees, 
their spouses, and dependents at a minimum dollar level for a 5-year 
cost maintenance period, beginning with the taxable year in which the 
qualified transfer occurs.
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    \1\ Section 420(a)(1) and (2) provide that the trust that is 
part of the plan is not treated as failing to satisfy the 
qualification requirements of section 401(a) or (h) of the Code, and 
no amount is includible in the gross income of the employer 
maintaining the plan, solely by reason of such transfer. Also, 
section 420(a)(3) provides that a qualified transfer is not treated 
as either an employer reversion for purposes of section 4980 or a 
prohibited transaction for purposes of section 4975.
    In addition, Title I of the Employee Retirement Income Security 
Act of 1974 (88 Stat. 829), as amended (ERISA), provides that a 
qualified transfer pursuant to section 420 is not a prohibited 
transaction under ERISA (ERISA section 408(b)(13)) or a prohibited 
reversion of assets to the employer (ERISA section 403(c)(1)). ERISA 
also provides certain notification requirements with respect to such 
qualified transfers.
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    The Uruguay Round Agreements Act (Public Law 103-465) (108 Stat. 
4809) (December 8, 1994), extended the availability of section 420 
through December 31, 2000. In conjunction with the extension, Congress 
modified the maintenance of effort rules for plans transferring assets 
for retiree health benefits so that employers could take into account 
cost savings realized in their health benefit plans. As a result, the 
focus of the maintenance of effort requirement was shifted from health 
costs to health benefits. Under this ``benefit maintenance 
requirement,'' which applied to qualified transfers made after December 
8, 1994, an employer had to maintain substantially the same level of 
employer-provided retiree health coverage for the taxable year of the 
transfer and the following 4 years. The level of coverage required to 
be maintained was based on the coverage provided in the taxable year 
immediately preceding the taxable year of the transfer.
    The Tax Relief Extension Act of 1999 (title V of H.R. 1180, the 
Ticket to Work and Work Incentives Improvement Act of 1999) (Public Law 
106-170,113 Stat. 1860) (TREA-99) extended section 420 through December 
31, 2005. In conjunction with this extension, the minimum cost 
requirement was reinstated as the applicable ``maintenance of effort'' 
provision (in lieu of requiring the maintenance of the level of 
coverage) for qualified transfers made after December 17, 1999. Because 
the minimum cost requirement relates to per capita cost, an employer 
could satisfy the minimum cost requirement by maintaining the average 
cost even though the employer defeats the purpose of the maintenance of 
effort requirement by reducing the number of people covered by the 
health plan. In response to concerns regarding this possibility, TREA-
99 also added section 420(c)(3)(E), which requires the Secretary of the 
Treasury to prescribe such regulations as may be necessary to prevent 
an employer who significantly reduces retiree health coverage during 
the cost maintenance period from being treated as satisfying the 
minimum cost requirement of section 420(c)(3). If the minimum cost 
requirement of section 420(c)(3) is not satisfied, the transfer of 
assets from the pension plan to the 401(h) account is not a ``qualified 
transfer'' to which the provisions of section 420(a) apply.
    On January 5, 2001, a notice of proposed rulemaking (REG-116468-00) 
was published in the Federal Register (66 FR 1066). Written comments 
were received on the proposed regulations. A public hearing scheduled 
for March 15, 2001 was canceled because no one had requested to speak 
(66 FR 13864). After consideration of all the comments received on the 
proposed regulations, the regulations are adopted as modified by this 
Treasury decision.

Explanation of Provisions

General Framework

    Following the approach taken in the proposed regulations, these 
regulations provide that the minimum cost requirement of section 
420(c)(3) is not met if an employer significantly reduces retiree 
health coverage during the cost maintenance period. Whether an employer 
has significantly reduced retiree health coverage is determined by 
looking at the number of individuals (retirees, their spouses, and 
dependents) who lose coverage during the cost maintenance period as a 
result of employer actions, measured on both an annual basis and a 
cumulative basis.
    In determining whether an employer has significantly reduced 
retiree health coverage, the regulations provide that the employer does 
not satisfy the minimum cost requirement if the percentage decrease in 
the number of individuals provided with applicable health benefits that 
is attributable to employer action exceeds 10 percent in any year, or 
if the sum of the annual percentage decreases during the cost 
maintenance period exceeds 20 percent.

Employer Action

    The regulations retain the broad definition of employer action 
contained in the proposed regulations. Thus, employer action includes 
not only plan amendments but also situations in which other employer 
actions, such as the sale of all or part of the employer's business, 
operate in conjunction with the existing plan terms to have the 
indirect effect of ending an individual's coverage.
    The proposed regulations contained no exceptions from the rule that 
treats individuals as losing health coverage by reason of employer 
action if those individuals' coverage ends by reason of a sale of all 
or part of the employer's business, even if the buyer provides coverage 
for such individuals (on the implicit assumption that a buyer of less 
than an entire corporation rarely undertakes to provide such coverage 
to retirees in these transactions). The preamble to the proposed 
regulations specifically requested comments as to (1) the 
circumstances, if any, in which buyers commonly provide the seller's 
retirees, and their spouses and dependents, with health coverage 
following a corporate transaction, and (2) in such cases, criteria that 
should apply to the replacement coverage in determining whether to 
treat those individuals as not having lost coverage.

[[Page 32899]]

    Commentators disagreed with the assumption stated in the preamble 
to the proposed regulations that a buyer acquiring a portion of a 
seller's business rarely undertakes to provide retiree health coverage 
to retirees in these transactions and expressed concern about the 
approach taken in the proposed regulations concerning individuals who 
lose retiree health coverage in such situations. One commentator stated 
that in the case of business combinations involving organizations that 
contract with the United States Government, the relevant procurement 
regulations encourage buyers to assume a seller's obligations for 
retirees' pension and retiree medical benefits. Other commentators 
expressed a desire to retain flexibility in structuring future business 
dispositions so that a buyer or transferee of a business could 
undertake to provide retiree health coverage for the seller's 
employees.
    Generally, commentators requested that the regulations allow an 
employer who sells or transfers a business to take into account health 
coverage that a buyer or transferee provides to retired employees of 
the employer. Various approaches were suggested, most of them centering 
around allowing an employer to take credit for retiree health benefits 
provided by a buyer or transferee that are substantially similar to the 
benefits provided by the employer.
    In cases in which a buyer acquires the entire employer sponsoring 
the pension plan that is the subject of the maintenance of effort 
requirement under section 420(c)(3)(E), no special rule is required, 
because the buyer as the successor employer maintaining the plan is 
responsible for continuing to satisfy the minimum cost requirements of 
section 420(c)(3) with respect to that transfer. However, based upon 
comments received, these final regulations include a special rule that 
allows the employer responsible for satisfying the maintenance of 
effort requirement of section 420(c)(3)(E) to take credit for a buyer's 
or transferee's provision of retiree health benefits in certain other 
situations.
    Under the final regulations, an employer may, but is not required 
to, treat retiree health coverage as not having ended for individuals 
whose coverage is provided by a buyer. In such a case, for the year of 
the sale and future taxable years of the cost maintenance period, the 
employer must apply the minimum cost requirement contained in section 
420(c)(3) by treating the individuals whose coverage is provided by the 
buyer as individuals to whom coverage for applicable health benefits is 
provided during the year (i.e., including all such individuals in the 
denominator in the determination of applicable employer cost) and 
treating amounts the buyer spends on health benefits for those 
individuals as qualified current retiree health liabilities. After the 
buyer commences providing the retiree health benefits, action of the 
buyer is attributed to the employer for purposes of determining whether 
an individual's coverage ends by reason of employer action. 
Accordingly, if a buyer initially provides retiree health benefits to 
individuals affected by the sale, but later amends its plan to stop 
providing benefits to those individuals, the employer must treat those 
individuals as having lost coverage by reason of employer action.
    These final regulations also add a definition of ``sale'' to 
clarify that the rule for sales applies as well to other transfers of a 
business. In the case of a transfer, the transferee is treated as the 
buyer. Thus, for example, the rule applies in a situation in which an 
employer spins off all or part of its business, and also applies when a 
contractor that operates a government-owned facility is replaced by 
another contractor and the replacement contractor hires the employees 
of the prior contractor to operate the facility.

Effective Date

    The proposed regulations provided that the 10 percent annual limit 
would not apply to a taxable year beginning before February 5, 2001 (30 
days after publication of the proposed regulations in the Federal 
Register). However, under the proposed regulations, the 20 percent 
cumulative limit applied with respect to cost maintenance periods 
pertaining to any transfers made on or after December 18, 1999. Thus, 
if an employer reduced coverage by more than 20 percent prior to 
issuance of the proposed regulations, the employer would have failed 
the cumulative test.
    Several commentators expressed concern about the proposed effective 
date of transfers occurring on or after December 18, 1999. None of the 
comments indicated that any employers had in fact reduced coverage by 
more than 20 percent prior to issuance of the proposed regulations, and 
one of the commentators stated that as a practical matter, the issue of 
retroactivity is moot. However, a number of the commentators expressed 
concern over retroactive effective dates in Treasury regulations as a 
matter of principle.
    These final regulations, like the proposed regulations, provide 
that the 20 percent cumulative test will apply with respect to 
transfers of excess pension assets occurring on or after December 18, 
1999. In order to address concerns raised by commentators, however, the 
final regulations take into account any reinstatement of coverage that 
occurs during the portion of a cost maintenance period that precedes 
the first day of the first taxable year beginning on or after January 
1, 2002 (the initial period). Thus, for purposes of the cumulative 
test, if an employer reduced retiree health coverage by more than 20 
percent, the employer can, before the end of the initial period, resume 
providing coverage for individuals who lost coverage and treat those 
individuals as not having lost coverage. However, if an employer 
reduces retiree health coverage by more than 20 percent during the 
initial period and does not ``correct'' by again providing coverage for 
individuals who lost coverage, the employer would fail the cumulative 
test. Also, the annual test of significant reduction applies only to 
taxable years beginning on or after January 1, 2002, which reflects a 
further delay from the date in the proposed regulation.

Additional Changes

    The proposed regulations contained a special rule that addresses 
situations in which an employer adopts plan terms that establish 
eligibility for health coverage for some individuals, but provide that 
those same individuals lose health coverage upon the occurrence of a 
particular event or after a stated period of time. In those cases, an 
individual is not counted as having lost health coverage by reason of 
employer action merely because that individual's coverage ends upon the 
occurrence of the event or after a certain period of time, such as when 
health benefits are provided to employees retiring as a result of a 
plant closing only for the period during which they receive severance 
pay (see example 2 of the regulations). As a result of the changes 
discussed above that address ``corrections'' through restoration of 
coverage during the initial period and sale transactions, these final 
regulations contain two modifications of the special rule for 
contemporaneously-adopted plan terms. First, the special rule is not 
available with respect to an amendment that restores coverage before 
the end of the initial period. Second, in the context of an amendment 
of a buyer's health plan to provide retiree health coverage for a 
seller's employees, the special rule is available only to the extent 
that any terms that have the effect of ending an individual's coverage 
are the same as

[[Page 32900]]

the terms of the plan maintained by the seller, and only if the terms 
of the seller's plan that terminate coverage were adopted 
contemporaneously with the provision under which the individual became 
eligible for retiree health coverage under the seller's plan.

Special Analyses

    It has been determined that this Treasury decision is not a 
significant regulatory action as defined in Executive Order 12866. 
Therefore, a regulatory assessment is not required. It has also been 
determined that section 553(b) of the Administrative Procedure Act (5 
U.S.C. chapter 5) does not apply to these regulations, and, because the 
regulations do not impose a collection of information on small 
entities, the Regulatory Flexibility Act (5 U.S.C. chapter 6) does not 
apply. Pursuant to section 7805(f) of the Code, the notice of proposed 
rulemaking preceding these regulations was submitted to the Chief 
Counsel for Advocacy of the Small Business Administration for comment 
on its impact on small business.

Drafting Information

    The principal authors of these regulations are Janet A. Laufer and 
Vernon S. Carter, Office of Division Counsel/Associate Chief Counsel 
(Tax Exempt and Government Entities). However, other personnel from the 
IRS and Treasury Department participated in their development.

List of Subjects in 26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

Adoption of Amendments to the Regulations

    Accordingly, 26 CFR part 1 is amended as follows:

PART 1--INCOME TAXES

    Paragraph 1. The authority citation for part 1 continues to read in 
part as follows:


    Authority: 26 U.S.C. 7805 * * *.

    Par. 2 Section 1.420-1 is added under the undesignated 
centerheading ``Pension, Profit-Sharing, Stock Bonus Plans, etc.'' to 
read as follows:


Sec. 1.420-1  Significant reduction in retiree health coverage during 
the cost maintenance period.

    (a) In general. Notwithstanding section 420(c)(3)(A), the minimum 
cost requirements of section 420(c)(3) are not met if the employer 
significantly reduces retiree health coverage during the cost 
maintenance period.
    (b) Significant reduction--(1) In general. An employer 
significantly reduces retiree health coverage during the cost 
maintenance period if, for any taxable year beginning on or after 
January 1, 2002, that is included in the cost maintenance period, 
either --
    (i) The employer-initiated reduction percentage for that taxable 
year exceeds 10 percent; or
    (ii) The sum of the employer-initiated reduction percentages for 
that taxable year and all prior taxable years during the cost 
maintenance period exceeds 20 percent.
    (2) Employer-initiated reduction percentage. The employer-initiated 
reduction percentage for any taxable year is the fraction B/A, 
expressed as a percentage, where:

A = The total number of individuals (retired employees plus their 
spouses plus their dependents) receiving coverage for applicable 
health benefits as of the day before the first day of the taxable 
year.
B = The total number of individuals included in A whose coverage for 
applicable health benefits ended during the taxable year by reason 
of employer action.

    (3) Special rules for taxable years beginning before January 1, 
2002. The following rules apply for purposes of computing the amount in 
paragraph (b)(1)(ii) of this section if any portion of the cost 
maintenance period precedes the first day of the first taxable year 
beginning on or after January 1, 2002--
    (i) Aggregation of taxable years. The portion of the cost 
maintenance period that precedes the first day of the first taxable 
year beginning on or after January 1, 2002 (the initial period) is 
treated as a single taxable year and the employer-initiated reduction 
percentage for the initial period is computed as set forth in paragraph 
(b)(2) of this section, except that the words ``initial period'' apply 
instead of ``taxable year.''
    (ii) Loss of coverage. If coverage for applicable health benefits 
for an individual ends by reason of employer action at any time during 
the initial period, an employer may treat that coverage as not having 
ended if the employer restores coverage for applicable health benefits 
to that individual by the end of the initial period.
    (4) Employer action--(i) General rule. For purposes of paragraph 
(b)(2) of this section, an individual's coverage for applicable health 
benefits ends during a taxable year by reason of employer action, if on 
any day within the taxable year, the individual's eligibility for 
applicable health benefits ends as a result of a plan amendment or any 
other action of the employer (e.g., the sale of all or part of the 
employer's business) that, in conjunction with the plan terms, has the 
effect of ending the individual's eligibility. An employer action is 
taken into account for this purpose regardless of when the employer 
action actually occurs (e.g., the date the plan amendment is executed), 
except that employer actions occurring before the later of December 18, 
1999, and the date that is 5 years before the start of the cost 
maintenance period are disregarded.
    (ii) Special rule. Notwithstanding paragraph (b)(4)(i) of this 
section, coverage for an individual will not be treated as having ended 
by reason of employer action merely because such coverage ends under 
the terms of the plan if those terms were adopted contemporaneously 
with the provision under which the individual became eligible for 
retiree health coverage. This paragraph (b)(4)(ii) does not apply with 
respect to plan terms adopted contemporaneously with a plan amendment 
that restores coverage for applicable health benefits before the end of 
the initial period in accordance with paragraph (b)(3)(ii) of this 
section.
    (iii) Sale transactions. If a purchaser provides coverage for 
retiree health benefits to one or more individuals whose coverage ends 
by reason of a sale of all or part of the employer's business, the 
employer may treat the coverage of those individuals as not having 
ended by reason of employer action. In such a case, for the remainder 
of the year of the sale and future taxable years of the cost 
maintenance period --
    (A) For purposes of computing the applicable employer cost under 
section 420(c)(3), those individuals are treated as individuals to whom 
coverage for applicable health benefits was provided (for as long as 
the purchaser provides retiree health coverage to them), and any 
amounts expended by the purchaser of the business to provide for health 
benefits for those individuals are treated as paid by the employer;
    (B) For purposes of determining whether a subsequent termination of 
coverage is by reason of employer action under this paragraph (b)(4), 
the purchaser is treated as the employer. However, the special rule in 
paragraph (b)(4)(ii) of this section applies only to the extent that 
any terms of the plan maintained by the purchaser that have the effect 
of ending retiree health coverage for an individual are the same as 
terms of the plan maintained by the employer that were adopted 
contemporaneously with the provision under which the individual became 
eligible for retiree health coverage under the plan maintained by the 
employer.

[[Page 32901]]

    (c) Definitions. The following definitions apply for purposes of 
this section:
    (1) Applicable health benefits. Applicable health benefits means 
applicable health benefits as defined in section 420(e)(1)(C).
    (2) Cost maintenance period. Cost maintenance period means the cost 
maintenance period as defined in section 420(c)(3)(D).
    (3) Sale. A sale of all or part of an employer's business means a 
sale or other transfer in connection with which the employees of a 
trade or business of the employer become employees of another person. 
In the case of such a transfer, the term purchaser means a transferee 
of the trade or business.
    (d) Examples. The following examples illustrate the application of 
this section:

    Example 1. (i) Employer W maintains a defined benefit pension 
plan that includes a 401(h) account and permits qualified transfers 
that satisfy section 420. The number of individuals receiving 
coverage for applicable health benefits as of the day before the 
first day of Year 1 is 100. In Year 1, Employer W makes a qualified 
transfer under section 420. There is no change in the number of 
individuals receiving health benefits during Year 1. As of the last 
day of Year 2, applicable health benefits are provided to 99 
individuals, because 2 individuals became eligible for coverage due 
to retirement and 3 individuals died in Year 2. During Year 3, 
Employer W amends its health plan to eliminate coverage for 5 
individuals, 1 new retiree becomes eligible for coverage and an 
additional 3 individuals are no longer covered due to their own 
decision to drop coverage. Thus, as of the last day of Year 3, 
applicable health benefits are provided to 92 individuals. During 
Year 4, Employer W amends its health plan to eliminate coverage 
under its health plan for 8 more individuals, so that as of the last 
day of Year 4, applicable health benefits are provided to 84 
individuals. During Year 5, Employer W amends its health plan to 
eliminate coverage for 8 more individuals.
    (ii) There is no significant reduction in retiree health 
coverage in either Year 1 or Year 2, because there is no reduction 
in health coverage as a result of employer action in those years.
    (iii) There is no significant reduction in Year 3. The number of 
individuals whose health coverage ended during Year 3 by reason of 
employer action (amendment of the plan) is 5. Since the number of 
individuals receiving coverage for applicable health benefits as of 
the last day of Year 2 is 99, the employer-initiated reduction 
percentage for Year 3 is 5.05 percent (5/99), which is less than the 
10 percent annual limit.
    (iv) There is no significant reduction in Year 4. The number of 
individuals whose health coverage ended during Year 4 by reason of 
employer action is 8. Since the number of individuals receiving 
coverage for applicable health benefits as of the last day of Year 3 
is 92, the employer-initiated reduction percentage for Year 4 is 
8.70 percent (8/92), which is less than the 10 percent annual limit. 
The sum of the employer-initiated reduction percentages for Year 3 
and Year 4 is 13.75 percent, which is less than the 20 percent 
cumulative limit.
    (v) In Year 5, there is a significant reduction under paragraph 
(b)(1)(ii) of this section. The number of individuals whose health 
coverage ended during Year 5 by reason of employer action (amendment 
of the plan) is 8. Since the number of individuals receiving 
coverage for applicable health benefits as of the last day of Year 4 
is 84, the employer-initiated reduction percentage for Year 5 is 
9.52 percent (8/84), which is less than the 10 percent annual limit. 
However, the sum of the employer-initiated reduction percentages for 
Year 3, Year 4, and Year 5 is 5.05 percent + 8.70 percent + 9.52 
percent = 23.27 percent, which exceeds the 20 percent cumulative 
limit.
    Example 2. (i) Employer X, a calendar year taxpayer, maintains a 
defined benefit pension plan that includes a 401(h) account and 
permits qualified transfers that satisfy section 420. X also 
provides lifetime health benefits to employees who retire from 
Division A as a result of a plant shutdown, no health benefits to 
employees who retire from Division B, and lifetime health benefits 
to all employees who retire from Division C. In 2000, X amends its 
health plan to provide coverage for employees who retire from 
Division B as a result of a plant shutdown, but only for the 2-year 
period coinciding with their severance pay. Also in 2000, X amends 
the health plan to provide that employees who retire from Division A 
as a result of a plant shutdown receive health coverage only for the 
2-year period coinciding with their severance pay. A plant shutdown 
that affects Division A and Division B employees occurs in 2000. The 
number of individuals receiving coverage for applicable health 
benefits as of the last day of 2001 is 200. In 2002, Employer X 
makes a qualified transfer under section 420. As of the last day of 
2002, applicable health benefits are provided to 170 individuals, 
because the 2-year period of benefits ends for 10 employees who 
retired from Division A and 20 employees who retired from Division B 
as a result of the plant shutdown that occurred in 2000.
    (ii) There is no significant reduction in retiree health 
coverage in 2002. Coverage for the 10 retirees from Division A who 
lose coverage as a result of the end of the 2-year period is treated 
as having ended by reason of employer action, because coverage for 
those Division A retirees ended by reason of a plan amendment made 
after December 17, 1999. However, the terms of the health plan that 
limit coverage for employees who retired from Division B as a result 
of the 2000 plant shutdown (to the 2-year period) were adopted 
contemporaneously with the provision under which those employees 
became eligible for retiree coverage under the health plan. 
Accordingly, under the rule provided in paragraph (b)(4)(ii) of this 
section, coverage for those 20 retirees from Division B is not 
treated as having ended by reason of employer action. Thus, the 
number of individuals whose health benefits ended by reason of 
employer action in 2002 is 10. Since the number of individuals 
receiving coverage for applicable health benefits as of the last day 
of 2001 is 200, the employer-initiated reduction percentage for 2002 
is 5 percent (10/200), which is less than the 10 percent annual 
limit.

    (e) Regulatory effective date. This section is applicable to 
transfers of excess pension assets occurring on or after December 18, 
1999.

David A. Mader,
Acting Deputy Commissioner of Internal Revenue.
    Approved: June 12, 2001.
Mark A. Weinberger,
Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. 01-15255 Filed 6-14-01; 2:45 pm]
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