113 
† HR 4213 EAS 
in which such plan year begins for 
services performed by the employee for 
the plan sponsor (whether or not per-
formed during such calendar year), 
over 
‘‘(II) $1,000,000. 
‘‘(ii) AMOUNTS SET ASIDE FOR NON-
QUALIFIED
DEFERRED
COMPENSATION.—If 
during any calendar year assets are set 
aside or reserved (directly or indirectly) in 
a trust (or other arrangement as determined 
by the Secretary), or transferred to such a 
trust or other arrangement, by a plan spon-
sor for purposes of paying deferred com-
pensation of an employee under a non-
qualified deferred compensation plan (as de-
fined in section 409A) of the plan sponsor, 
then, for purposes of clause (i), the amount 
of such assets shall be treated as remunera-
tion of the employee includible in income 
for the calendar year unless such amount is 
otherwise includible in income for such 
year. An amount to which the preceding 
sentence applies shall not be taken into ac-
114 
† HR 4213 EAS 
count under this paragraph for any subse-
quent calendar year. 
‘‘(iii) ONLY REMUNERATION FOR CER-
TAIN
POST-2009
SERVICES
COUNTED.—Re-
muneration shall be taken into account 
under clause (i) only to the extent attrib-
utable to services performed by the employee 
for the plan sponsor after February 28, 
2010. 
‘‘(iv) EXCEPTION FOR CERTAIN EQUITY 
PAYMENTS.— 
‘‘(I) IN
GENERAL.—There shall 
not be taken into account under clause 
(i)(I) any amount includible in income 
with respect to the granting after Feb-
ruary 28, 2010, of service recipient 
stock (within the meaning of section 
409A) that, upon such grant, is subject 
to a substantial risk of forfeiture (as 
defined under section 83(c)(1)) for at 
least 5 years from the date of such 
grant. 
‘‘(II) 
SECRETARIAL
AUTHOR-
ITY.—The Secretary may by regulation 
provide for the application of this
115 
† HR 4213 EAS 
clause in the case of a person other 
than a corporation. 
‘‘(v) OTHER
EXCEPTIONS.—The fol-
lowing amounts includible in income shall 
not be taken into account under clause 
(i)(I): 
‘‘(I) COMMISSIONS.—Any remu-
neration payable on a commission 
basis solely on account of income di-
rectly generated by the individual per-
formance of the individual to whom 
such remuneration is payable. 
‘‘(II) CERTAIN PAYMENTS UNDER 
EXISTING
CONTRACTS.—Any 
remu-
neration consisting of nonqualified de-
ferred compensation, restricted stock, 
stock options, or stock appreciation 
rights payable or granted under a 
written binding contract that was in 
effect on March 1, 2010, and which 
was not modified in any material re-
spect before such remuneration is paid. 
‘‘(vi) 
SELF-EMPLOYED
INDIVIDUAL 
TREATED
AS
EMPLOYEE.—The term ‘em-
ployee’ includes, with respect to a calendar
116 
† HR 4213 EAS 
year, a self-employed individual who is 
treated as an employee under section 401(c) 
for the taxable year ending during such cal-
endar year, and the term ‘compensation’ 
shall include earned income of such indi-
vidual with respect to such self-employment. 
‘‘(vii) INDEXING OF AMOUNT.—In the 
case of any calendar year beginning after 
2010, the dollar amount under clause (i)(II) 
shall be increased by an amount equal to— 
‘‘(I) such dollar amount, multi-
plied by 
‘‘(II) the cost-of-living adjustment 
determined under section 1(f)(3) for 
the calendar year, determined by sub-
stituting ‘calendar year 2009’ for ‘cal-
endar year 1992’ in subparagraph (B) 
thereof. 
If the amount of any increase under clause 
(i) is not a multiple of $1,000, such in-
crease shall be rounded to the next lowest 
multiple of $1,000. 
‘‘(E) EXTRAORDINARY DIVIDENDS AND RE-
DEMPTIONS.—
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† HR 4213 EAS 
‘‘(i) IN GENERAL.—The amount deter-
mined under this subparagraph for any 
plan year is the excess (if any) of the sum 
of the dividends declared during the plan 
year by the plan sponsor plus the aggregate 
amount paid for the redemption of stock of 
the plan sponsor redeemed during the plan 
year over the greater of— 
‘‘(I) the adjusted net income 
(within the meaning of section 4043 of 
the Employee Retirement Income Secu-
rity Act of 1974) of the plan sponsor 
for the preceding plan year, deter-
mined without regard to any reduction 
by reason of interest, taxes, deprecia-
tion, or amortization, or 
‘‘(II) in the case of a plan sponsor 
that determined and declared dividends 
in the same manner for at least 5 con-
secutive years immediately preceding 
such plan year, the aggregate amount 
of dividends determined and declared 
for such plan year using such manner. 
‘‘(ii) ONLY
CERTAIN
POST-2009
DIVI-
DENDS AND REDEMPTIONS COUNTED.—For
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† HR 4213 EAS 
‘‘(1) in the case of the increased unfunded new 
liability of the plan, the applicable percentage de-
scribed in section 302(d)(4)(C) of such Act and sec-
tion 412(l)(4)(C) of such Code for any pre-effective 
date plan year beginning with or after the first elec-
tion year shall be the ratio of— 
‘‘(A) the annual installments payable in 
each year if the increased unfunded new liability 
for such plan year were amortized over 15 years, 
using an interest rate equal to the third segment 
rate described in sections 104(b), 105(b), and 
106(b) of this Act, to 
‘‘(B) the increased unfunded new liability 
for such plan year, and 
‘‘(2) in the case of the excess of the unfunded new 
liability over the increased unfunded new liability, 
such applicable percentage shall be determined with-
out regard to this section. 
‘‘(d) ELECTION.— 
‘‘(1) IN GENERAL.—The plan sponsor of a plan 
may elect to have this section apply to not more than 
2 eligible plan years with respect to the plan, except 
that in the case of a plan to which section 106 of this 
Act applies, the plan sponsor may only elect to have 
this section apply to 1 eligible plan year.