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26-51-414. Deferred compensation plans.
Arkansas Code — all titles (historical 2020) · legal_authorities
26-51-414. Deferred compensation plans.
(a)(1) The following sections relating to annuities, retirement savings, and employee benefit plans are adopted for the purpose of computing Arkansas income tax liability, except Arkansas capital gains treatment and the Arkansas tax rates shall apply:
(A) Title 26 U.S.C. §§ 72, 219, 402 — 404, 406 — 416, and 457, as in effect on January 1, 2017; and
(B) Title 26 U.S.C. § 401, as in effect on March 30, 2010.
(2) The requirements for filing a joint return under 26 U.S.C. § 219(c)(1)(A) shall not apply.
(b) Title 26 U.S.C. § 408A as in effect on January 1, 2010, relating to Roth individual retirement accounts, is adopted for the purpose of computing Arkansas income tax liability, except with regard to adjusted gross income under 26 U.S.C. § 408A(c)(3), which shall be determined in the same manner as under § 26-51-403(b).
(c) Any additional tax or penalty imposed by this section shall be ten percent (10%) of the amount of any additional tax or penalty provided in the federal income tax law adopted by this section.
(d) Title 26 U.S.C. § 1042, as in effect on January 1, 2003, regarding the deferral of gain realized on the sale of a corporation's shares of stock to the corporation's employee stock ownership plan (ESOP), is adopted for the purpose of computing Arkansas income tax liability.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 26-51-414
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26-51-414. Deferred compensation plans.
(a)(1) The following sections relating to annuities, retirement savings, and employee benefit plans are adopted for the purpose of computing Arkansas income tax liability, except Arkansas capital gains treatment and the Arkansas tax rates shall apply:
(A) Title 26 U.S.C. §§ 72, 219, 402 — 404, 406 — 416, and 457, as in effect on January 1, 2017; and
(B) Title 26 U.S.C. § 401, as in effect on March 30, 2010.
(2) The requirements for filing a joint return under 26 U.S.C. § 219(c)(1)(A) shall not apply.
(b) Title 26 U.S.C. § 408A as in effect on January 1, 2010, relating to Roth individual retirement accounts, is adopted for the purpose of computing Arkansas income tax liability, except with regard to adjusted gross income under 26 U.S.C. § 408A(c)(3), which shall be determined in the same manner as under § 26-51-403(b).
(c) Any additional tax or penalty imposed by this section shall be ten percent (10%) of the amount of any additional tax or penalty provided in the federal income tax law adopted by this section.
(d) Title 26 U.S.C. § 1042, as in effect on January 1, 2003, regarding the deferral of gain realized on the sale of a corporation's shares of stock to the corporation's employee stock ownership plan (ESOP), is adopted for the purpose of computing Arkansas income tax liability.
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Nonrecognition of gain** If—
(1) the taxpayer or executor elects in such form as the Secretary may prescribe the application of this section with respect to any sale of qualified securities,
(2) the taxpayer purchases qualified replacement property within the replacement period, and
(3) the requirements of subsection (b) are met with respect to such sale,
then the gain (if any) on such sale which would be recognized as long-term capital gain shall be recognized only to the extent that the amount realized on such sale exceeds the cost to the taxpayer of such qualified replacement property.
**(b) Requirements to qualify for nonrecognition** A sale of qualified securities meets the requirements of this subsection if—
(1) **Sale to employee organizations** — The qualified securities are sold to—
(A) an employee stock ownership plan (as defined in section 4975(e)(7)), or
(B) an eligible worker-owned cooperative.
(2) **Plan must hold 30 percent of stock after sale** — The plan or cooperative referred to in paragraph (1) owns (after application of section 318(a)(4)), immediately after the sale, at least 30 percent of—
(A) each class of outstanding stock of the corporation (other than stock described in section 1504(a)(4)) which issued the qualified securities, or
(B) the total value of all outstanding stock of the corporation (other than stock described in section 1504(a)(4)).
(3) **Written statement required**
(A) *In general* — The taxpayer files with the Secretary the written statement described in subparagraph (B).
(B) *Statement* — A statement is described in this subparagraph if it is a verified written statement of—
(i) the employer whose employees are covered by the plan described in paragraph (1), or
(ii) any authorized officer
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 1042
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Federal law — U.S. Code and appendices · legal_authorities
Page 2286
TITLE 26—INTERNAL REVENUE CODE
§ 1042
1 So in original. Probably should be ‘‘paragraph (1),’’.
(1) the sum of the amount of the liabilities
assumed, plus the amount of the liabilities to
which the property is subject, exceeds
(2) the total of the adjusted basis of the
property transferred.
Proper adjustment shall be made under sub-
section (b) in the basis of the transferee in such
property to take into account gain recognized
by reason of the preceding sentence.
(Added Pub. L. 98–369, div. A, title IV, § 421(a),
July 18, 1984, 98 Stat. 793; amended Pub. L.
99–514, title XVIII, § 1842(b), Oct. 22, 1986, 100
Stat. 2853; Pub. L. 100–647, title I, § 1018(l)(3),
Nov. 10, 1988, 102 Stat. 3584.)
Editorial Notes
AMENDMENTS
1988—Subsec. (d). Pub. L. 100–647 substituted ‘‘Sub-
section (a)’’ for ‘‘Paragraph (1) of subsection (a)’’ and
‘‘the spouse (or former spouse)’’ for ‘‘the spouse’’.
1986—Subsec. (e). Pub. L. 99–514 added subsec. (e).
Statutory Notes and Related Subsidiaries
EFFECTIVE DATE OF 1988 AMENDMENT
Pub. L. 100–647, title I, § 1018(l)(3), Nov. 10, 1988, 102
Stat. 3584, provided that the amendment made by that
section is effective with respect to transfers after June
21, 1988.
EFFECTIVE DATE OF 1986 AMENDMENT
Amendment by Pub. L. 99–514 effective, except as oth-
erwise provided, as if included in the provisions of the
Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which
such amendment relates, see section 1881 of Pub. L.
99–514, set out as a note under section 48 of this title.
EFFECTIVE DATE
Pub. L. 98–369, div. A, title IV, § 421(d), July 18, 1984,
98 Stat. 795, provided that:
‘‘(1) IN
GENERAL.—Except as otherwise provided in
this subsection, the amendments made by this section
[enacting this section and amending sections
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 1042
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Allowance of deduction** In the case of an individual, there shall be allowed as a deduction an amount equal to the qualified retirement contributions of the individual for the taxable year.
**(b) Maximum amount of deduction**
(1) **In general** — The amount allowable as a deduction under subsection (a) to any individual for any taxable year shall not exceed the lesser of—
(A) the deductible amount, or
(B) an amount equal to the compensation includible in the individual’s gross income for such taxable year.
(2) **Special rule for employer contributions under simplified employee pensions** — This section shall not apply with respect to an employer contribution to a simplified employee pension.
(3) **Plans under section 501(c)(18)** — Notwithstanding paragraph (1), the amount allowable as a deduction under subsection (a) with respect to any contributions on behalf of an employee to a plan described in section 501(c)(18) shall not exceed the lesser of—
(A) $7,000, or
(B) an amount equal to 25 percent of the compensation (as defined in section 415(c)(3)) includible in the individual’s gross income for such taxable year.
(4) **Special rule for simple retirement accounts** — This section shall not apply with respect to any amount contributed to a simple retirement account established under section 408(p).
(5) **Deductible amount** — For purposes of paragraph (1)(A)—
(A) *In general* — The deductible amount is $5,000.
(B) *Catch-up contributions for individuals 50 or older*
(i) *In general* — In the case of an individual who has attained the age of 50 before the close of the taxable year, the deductible amount for such taxable year shall be increased by the applicable amount.
(ii) *Applicable amount* — For purposes of clause (i), the app
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 219
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Federal law — U.S. Code and appendices · legal_authorities
Page 948
TITLE 26—INTERNAL REVENUE CODE
[§ 218
EFFECTIVE DATE OF 1969 AMENDMENT
Pub. L. 91–172, title II, § 231(d), Dec. 30, 1969, 83 Stat.
580, as amended by Pub. L. 91–642, § 2, Dec. 31, 1970, 84
Stat. 1880; Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095,
provided that: ‘‘The amendments made by this section
[enacting section 82 of this title and amending this sec-
tion and sections 1001 and 1016 of this title] shall apply
to taxable years beginning after December 31, 1969, ex-
cept that—
‘‘(1) section 217 of the Internal Revenue Code of 1986
[formerly I.R.C. 1954] (as amended by subsection (a))
shall not apply to any item to the extent that the
taxpayer received or accrued reimbursement or other
expense allowance for such item in a taxable year be-
ginning on or before December 31, 1969, which was not
included in his gross income; and
‘‘(2) the amendments made by this section shall not
apply (at the election of the taxpayer made at such
time and manner as the Secretary of the Treasury or
his delegate prescribes) with respect to moving ex-
penses paid or incurred before January 1, 1971, in con-
nection with the commencement of work by the tax-
payer as an employee at a new principal place of
work of which the taxpayer had been notified by his
employer on or before December 19, 1969.’’
EFFECTIVE DATE
Section applicable to expenses incurred after Dec. 31,
1963, in taxable years ending after such date, see sec-
tion 213(d) of Pub. L. 88–272, set out as an Effective Date
of 1964 Amendment note under section 62 of this title.
MOVING EXPENSES OF MEMBERS OF THE UNIFORMED
SERVICES
Pub. L. 93–490, § 2, Oct. 26, 1974, 88 Stat. 1466, author-
ized the Secretary of the Treasury, applicable with re-
spect to taxable years ending before January 1, 1976, to:
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 219
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Requirements for qualification** A trust created or organized in the United States and forming part of a stock bonus, pension, or profit-sharing plan of an employer for the exclusive benefit of his employees or their beneficiaries shall constitute a qualified trust under this section—
(1) if contributions are made to the trust by such employer, or employees, or both, or by another employer who is entitled to deduct his contributions under section 404(a)(3)(B) (relating to deduction for contributions to profit-sharing and stock bonus plans), or by a charitable remainder trust pursuant to a qualified gratuitous transfer (as defined in section 664(g)(1)), for the purpose of distributing to such employees or their beneficiaries the corpus and income of the fund accumulated by the trust in accordance with such plan;
(2) if under the trust instrument it is impossible, at any time prior to the satisfaction of all liabilities with respect to employees and their beneficiaries under the trust, for any part of the corpus or income to be (within the taxable year or thereafter) used for, or diverted to, purposes other than for the exclusive benefit of his employees or their beneficiaries (but this paragraph shall not be construed, in the case of a multiemployer plan, to prohibit the return of a contribution within 6 months after the plan administrator determines that the contribution was made by a mistake of fact or law (other than a mistake relating to whether the plan is described in section 401(a) or the trust which is part of such plan is exempt from taxation under section 501(a), or the return of any withdrawal liability payment determined to be an overpayment within 6 months of such determination));
(3) if the plan of which such trust is a part satisfies the requireme
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 401
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Federal law — U.S. Code and appendices · legal_authorities
Page 1178
TITLE 26—INTERNAL REVENUE CODE
§ 401
1983—Pub. L. 98–21, title III, § 321(e)(2)(D)(ii), Apr. 20,
1983, 97 Stat. 120, substituted ‘‘Employees of foreign af-
filiates covered by section 3121(l) agreements’’ for ‘‘Cer-
tain employees of foreign subsidiaries’’ in item 406.
1980—Pub. L. 96–603, § 2(d)(1), Dec. 28, 1980, 94 Stat.
3510, added item 404A.
Pub. L. 96–222, title I, § 101(a)(7)(L)(v)(VIII), Apr. 1,
1980, 94 Stat. 200, substituted ‘‘tax credit employee
stock ownership plans’’ for ‘‘ESOPS’’ in item 409A.
1978—Pub. L. 95–600, title I, § 141(f)(8), Nov. 6, 1978, 92
Stat. 2795, added item 409A.
1974—Pub. L. 93–406, title II, § 1016(b)(1), Sept. 2, 1974,
88 Stat. 932, inserted heading ‘‘Subpart A—General
Rule’’ and added analysis of subparts.
Pub. L. 93–406, title II, § 2002(h)(2), Sept. 2, 1974, 88
Stat. 970, added items 408 and 409.
1964—Pub. L. 88–272, title II, § 220(c)(1), Feb. 26, 1964, 78
Stat. 62, added items 406 and 407.
1962—Pub. L. 87–792, § 5(b), Oct. 10, 1962, 76 Stat. 827,
added item 405.
§ 401. Qualified pension, profit-sharing, and stock
bonus plans
(a) Requirements for qualification
A trust created or organized in the United
States and forming part of a stock bonus, pen-
sion, or profit-sharing plan of an employer for
the exclusive benefit of his employees or their
beneficiaries shall constitute a qualified trust
under this section—
(1) if contributions are made to the trust by
such employer, or employees, or both, or by
another employer who is entitled to deduct his
contributions under section 404(a)(3)(B) (relat-
ing to deduction for contributions to profit-
sharing and stock bonus plans), or by a chari-
table remainder trust pursuant to a qualified
gratuitous transfer (as defined in section
664(g)(1)), for the p
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 401
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** Except as provided in this section, a Roth IRA shall be treated for purposes of this title in the same manner as an individual retirement plan.
**(b) Roth IRA** For purposes of this title, the term “Roth IRA” means an individual retirement plan (as defined in section 7701(a)(37)) which is designated (in such manner as the Secretary may prescribe) at the time of establishment of the plan as a Roth IRA. Such designation shall be made in such manner as the Secretary may prescribe.
**(c) Treatment of contributions**
(1) **No deduction allowed** — No deduction shall be allowed under section 219 for a contribution to a Roth IRA.
(2) **Contribution limit** — The aggregate amount of contributions for any taxable year to all Roth IRAs maintained for the benefit of an individual shall not exceed the excess (if any) of—
(A) the maximum amount allowable as a deduction under section 219 with respect to such individual for such taxable year (computed without regard to subsection (g) of such section), over
(B) the aggregate amount of contributions for such taxable year to all other individual retirement plans (other than Roth IRAs) maintained for the benefit of the individual.
(3) **Limits based on modified adjusted gross income**
(A) *Dollar limit* — The amount determined under paragraph (2) for any taxable year shall not exceed an amount equal to the amount determined under paragraph (2)(A) for such taxable year, reduced (but not below zero) by the amount which bears the same ratio to such amount as—
(i) the excess of—
(I) the taxpayer’s adjusted gross income for such taxable year, over
(II) the applicable dollar amount, bears to
(ii) $15,000 ($10,000 in the case of a joint return or a married individual filing a separate re
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 408A
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Federal law — U.S. Code and appendices · legal_authorities
Page 1332
TITLE 26—INTERNAL REVENUE CODE
§ 408A
TRANSITIONAL RULE FOR CONTRIBUTIONS FOR TAXABLE
YEARS BEGINNING BEFORE JANUARY 1, 1978
Pub. L. 95–600, title I, § 157(c)(2)(B), Nov. 6, 1978, 92
Stat. 2805, as amended by Pub. L. 99–514, § 2, Oct. 22,
1986, 100 Stat. 2095, provided that: ‘‘In the case of con-
tributions for taxable years beginning before January
1, 1978, paragraph (5) of section 408(d) of the Internal
Revenue Code of 1986 [formerly I.R.C. 1954] shall be ap-
plied as if such paragraph did not contain any dollar
limitation.’’
EXCHANGE OF FIXED PREMIUM ANNUITY OR ENDOWMENT
CONTRACT ISSUED ON
OR BEFORE NOV. 6, 1978, FOR
INDIVIDUAL RETIREMENT ANNUITY
Pub. L. 95–600, title I, § 157(d)(3), Nov. 6, 1978, 92 Stat.
2806, as amended by Pub. L. 99–514, § 2, Oct. 22, 1986, 100
Stat. 2095, provided that: ‘‘In the case of any annuity or
endowment contract issued on or before the date of the
enactment of this Act [Nov. 6, 1978] which would be an
individual retirement annuity within the meaning of
section 408(b) of the Internal Revenue Code of 1986 [for-
merly I.R.C. 1954] (as amended by paragraph (1) [amend-
ing subsec. (b)(2) of this section]) but for the fact that
the premiums under the contract are fixed, at the elec-
tion of the taxpayer an exchange before January 1, 1981,
of that contract for an individual retirement annuity
within the meaning of such section 408(b) (as amended
by paragraph (1)) shall be treated as a nontaxable ex-
change which does not constitute a distribution.’’
§ 408A. Roth IRAs
(a) General rule
Except as provided in this section, a Roth IRA
shall be treated for purposes of this title in the
same manner as an individual retirement plan.
(b) Roth IRA
For purposes of this title, the term ‘‘Roth
IRA’’ means an individual r
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 408A
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rules for annuities**
(1) **Income inclusion** — Except as otherwise provided in this chapter, gross income includes any amount received as an annuity (whether for a period certain or during one or more lives) under an annuity, endowment, or life insurance contract.
(2) **Partial annuitization** — If any amount is received as an annuity for a period of 10 years or more or during one or more lives under any portion of an annuity, endowment, or life insurance contract—
(A) such portion shall be treated as a separate contract for purposes of this section,
(B) for purposes of applying subsections (b), (c), and (e), the investment in the contract shall be allocated pro rata between each portion of the contract from which amounts are received as an annuity and the portion of the contract from which amounts are not received as an annuity, and
(C) a separate annuity starting date under subsection (c)(4) shall be determined with respect to each portion of the contract from which amounts are received as an annuity.
**(b) Exclusion ratio**
(1) **In general** — Gross income does not include that part of any amount received as an annuity under an annuity, endowment, or life insurance contract which bears the same ratio to such amount as the investment in the contract (as of the annuity starting date) bears to the expected return under the contract (as of such date).
(2) **Exclusion limited to investment** — The portion of any amount received as an annuity which is excluded from gross income under paragraph (1) shall not exceed the unrecovered investment in the contract immediately before the receipt of such amount.
(3) **Deduction where annuity payments cease before entire investment recovered**
(A) *In general* — If—
(i) after the annuity starti
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 72
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Federal law — U.S. Code and appendices · legal_authorities
Page 462
TITLE 26—INTERNAL REVENUE CODE
[§ 71
1 Section catchline amended by Pub. L. 115–97 without cor-
responding amendment of analysis.
tion [amending this section] shall apply to taxable
years beginning after December 31, 2005.’’
EFFECTIVE DATE OF 1998 AMENDMENT
Pub. L. 105–277, div. J, title IV, § 4004(c)(3), Oct. 21,
1998, 112 Stat. 2681–911, provided that: ‘‘The amendment
made by subsection (b)(2) [amending this section] shall
apply to taxable years beginning after December 31,
1990.’’
EFFECTIVE DATE OF 1993 AMENDMENT
Amendment by section 13201(b)(3)(E) of Pub. L. 103–66
applicable to taxable years beginning after Dec. 31,
1992, see section 13201(c) of Pub. L. 103–66, set out as a
note under section 1 of this title.
EFFECTIVE DATE
Section applicable to taxable years beginning after
Dec. 31, 1990, see section 11103(e) of Pub. L. 101–508, set
out as an Effective Date of 1990 Amendment note under
section 1 of this title.
PART II—ITEMS SPECIFICALLY INCLUDED
IN GROSS INCOME
Sec.
[71.
Repealed.]
72.
Annuities; certain proceeds of endowment
and life insurance contracts.
73.
Services of child.
74.
Prizes and awards.
75.
Dealers in tax-exempt securities.
[76.
Repealed.]
77.
Commodity credit loans.
78.
Dividends received from certain foreign cor-
porations by domestic corporations choos-
ing foreign tax credit.1
79.
Group-term life insurance purchased for em-
ployees.
80.
Restoration of value of certain securities.
[81.
Repealed.]
82.
Reimbursement of moving expenses.
83.
Property transferred in connection with per-
formance of services.
84.
Transfer of appreciated property to political
organizations.
85.
Unemployment compensation.
86.
Social security and tier 1 railroad retirement
benefits.
87.
Alcohol and biodiesel fue
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 72
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