Fort Walton Beach Council agenda — 04-22-08 regular agenda — reading text

subject to paragraph ( 1) are made. r t C) PUBLIC SAFETY OFFICER. —The terra `public safety officer' shall have the same meaning given such term by section 1204(9)(A) ofthe Omnibus Crime Control and Safe Streets A)). Act of 1968 ( 42 U.S.C. 3796b( 9)( D) QUALIFIED HEALTH INSURANCE P S. — The term `qualified health insurance premiums' means prremiums for coverage for the eligible retired public safety officer, his spouse, and dependents, by an accident or health insurance plan or qualified long t-erm care insurance contract (as defined in section 770213( b)). r 5) SPECIAL, RULES. -- For purposes of this subsection— Paragraph ( 1) shall only apply to a A) DIRECT PAYMENT TO INSURER REQUIRED.— 236 distribution ifpayment of the premiums is made directly to the provider of the H. R: 4 -- accident or health insurance plan or qualified long -term care insurance contract by deduction from a distribution from the eligible retirement plan. B) RELATED PLANS TREATED AS 1—All,eligible retirement plans ofan employer shall be treated as a single plan. 6) ELECTION DESCRIBED. A) IN GENERAL: For purposes ofparagraph ( 1), an election is described in this paragraph if the election is made by an employee after-separation from service with respect to amounts not distributed from an eligible retirement plan to have amounts from such plan distributed in order to pay for qualified health insurance premiums. - B) SPECXAL RULE. —A plan shall not be treated as violating the requirements ofsection 401, or as engaging in a prohibited transaction for purposes of section 503(b), merely because it provides for an electron with respect to amounts that are otherwise distributable under the A). plan or merely because of a distribution made pursuant to an election described in subparagraph ( 7) COORDINATION WrIH MEDICAL EXPENSE DEDUCTION.- - The amounts excluded from gross income under paragraph ( 1) shall not be talren into account under section 213. 8) COORDINATION WITH DEDTJ'CTION FOR HEALTH INSURANCE COSTS OF SELF - ENI LOYED INDIVIDUALS. -- The amounts excluded from gross income under paragraph (1) shall not be taken into account under section 162(l)." . b) COIFORM[NGc.AMENDMENTS. -- 1) Section 403(a) of such Code (relating to taxability ofbenefciary under a qualified annuity plan) is amended by inserting after paragraph ( 1) the following new paragraph: C71'. "( 2) SPECIAL RULE FOR HEALTH AND LONG-TERM CARE INSURANCE.— To the extent provided in section 402(1), paragraph (1) shall not apply to the amount distributed under the contract which is otherwise includible in gross income under this subsection. ". 2) Section.403 (b) ofsuch Code (relating to taxability ofbeneficiary under amuity purchased by section 501( c)( 3) organization or public school) is amended by inserting after paragraph (1) the following new paragraph: 4"( 2) SPECIAL RULE FOR HEALTH AND LONG -TERM CARE INSURANCE. — To the extent provided in section 4020), paragraph ( 1) shall not apply to the amount distributed under the contract which is otherwise includible in gross income under this subsection. ". 3) Section 457(a) of such Code (relating to year of inclusion in gross income) is amended by adding,at the end the following new paragraph: t `( 3) SPECIAL RULE FOR HEALTH AND LONG-TERM CARE INSURANCE.— In the case of a plan of an eligible employer described in subsection (e)( 1)( A), to the extent provided in section 442(1), paragraph ( 1) shall not apply to amounts otherwise includible in gross income under this subsectaion. ". c) EFFECTIVE DATE. —The amendments made by this section shall apply to distributions in taxable years beginning after December 31, 2006. C7