§ 4974. — Excise tax on certain accumulations in qualified retirement plans.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 26USC4974]
TITLE 26--INTERNAL REVENUE CODE
Subtitle D--Miscellaneous Excise Taxes
CHAPTER 43--QUALIFIED PENSION, ETC., PLANS
Sec. 4974. Excise tax on certain accumulations in qualified
retirement plans
(a) General rule
If the amount distributed during the taxable year of the payee under
any qualified retirement plan or any eligible deferred compensation plan
(as defined in section 457(b)) is less than the minimum required
distribution for such taxable year, there is hereby imposed a tax equal
to 50 percent of the amount by which such minimum required distribution
exceeds the actual amount distributed during the taxable year. The tax
imposed by this section shall be paid by the payee.
(b) Minimum required distribution
For purposes of this section, the term ``minimum required
distribution'' means the minimum amount required to be distributed
during a taxable year under section 401(a)(9), 403(b)(10), 408(a)(6),
408(b)(3), or 457(d)(2), as the case may be, as determined under
regulations prescribed by the Secretary.
(c) Qualified retirement plan
For purposes of this section, the term ``qualified retirement plan''
means--
(1) a plan described in section 401(a) which includes a trust
exempt from tax under section 501(a),
(2) an annuity plan described in section 403(a),
(3) an annuity contract described in section 403(b),
(4) an individual retirement account described in section
408(a), or
(5) an individual retirement annuity described in section
408(b).
Such term includes any plan, contract, account, or annuity which, at any
time, has been determined by the Secretary to be such a plan, contract,
account, or annuity.
(d) Waiver of tax in certain cases
If the taxpayer establishes to the satisfaction of the Secretary
that--
(1) the shortfall described in subsection (a) in the amount
distributed during any taxable year was due to reasonable error, and
(2) reasonable steps are being taken to remedy the shortfall,
the Secretary may waive the tax imposed by subsection (a) for the
taxable year.
(Added Pub. L. 93-406, title II, Sec. 2002(e), Sept. 2, 1974, 88 Stat.
967; amended Pub. L. 94-455, title XIX, Sec. 1906(b)(13)(A), Oct. 4,
1976, 90 Stat. 1834; Pub. L. 95-600, title I, Sec. 157(i)(1), Nov. 6,
1978, 92 Stat. 2808; Pub. L. 99-514, title XI, Sec. 1121(a)(1), title
XVIII, Sec. 1852(a)(7)(B), (C), Oct. 22, 1986, 100 Stat. 2464, 2866.)
Amendments
1986--Pub. L. 99-514, Sec. 1121(a)(1), amended section generally,
substituting provisions imposing an excise tax on certain accumulations
in qualified retirement plans for provisions imposing an excise tax on
certain accumulations in individual retirement accounts and annuities.
Subsec. (a). Pub. L. 99-514, Sec. 1852(a)(7)(B), substituted
``section 408(a)(6) or 408(b)(3)'' for ``section 408(a)(6) or (7), or
408(b)(3) or (4)''.
Subsec. (b). Pub. L. 99-514, Sec. 1852(a)(7)(C), substituted
``section 408(a)(6) or 408(b)(3)'' for ``section 408(a)(6) or (7) or
408(b)(3) or (4)''.
1978--Subsec. (c). Pub. L. 95-600 added subsec. (c).
1976--Subsec. (b). Pub. L. 94-455 struck out ``or his delegate''
after ``Secretary''.
Effective Date of 1986 Amendment
Amendment by section 1121(a)(1) of Pub. L. 99-514 applicable to
years beginning after Dec. 31, 1988, with special provisions for plans
maintained pursuant to collective bargaining agreements ratified before
Mar. 1, 1986, and transition rules, see section 1121(d) of Pub. L. 99-
514, set out as a note under section 401 of this title.
Amendment by section 1852(a)(7)(B), (C) of Pub. L. 99-514 effective,
except as otherwise 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 of 1978 Amendment
Section 157(i)(2) of Pub. L. 95-600 provided that: ``The amendment
made by paragraph (1) [amending this section] shall apply to taxable
years beginning after December 31, 1975.''
Effective Date
Section effective Jan. 1, 1975, see section 2002(i)(2) of Pub. L.
93-406, set out as an Effective Date note under section 4973 of this
title.
Plan Amendments Not Required Until January 1, 1989
For provisions directing that if any amendments made by subtitle A
or subtitle C of title XI [Secs. 1101-1147 and 1171-1177] or title XVIII
[Secs. 1800-1899A] of Pub. L. 99-514 require an amendment to any plan,
such plan amendment shall not be required to be made before the first
plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub.
L. 99-514, as amended, set out as a note under section 401 of this
title.
Section Referred to in Other Sections
This section is referred to in sections 25B, 72, 408, 457, 6058 of
this title; title 23 section 181; title 49 section 41762.
