- 16 -
(1) In general.--Except as otherwise provided in
this subsection, the term "qualified cost" means, with
respect to any taxable year, the sum of--
(A) the qualified direct cost for such
taxable year, and
(B) subject to the limitation of section
419A(b), any addition to a qualified asset account
for the taxable year.
(2) Reduction for funds after-tax income.--In the
case of any welfare benefit fund, the qualified cost
for any taxable year shall be reduced by such fund's
after-tax income for such taxable year.
(3) Qualified direct cost.--
(A) In general.--The term "qualified direct
cost" means, with respect to any taxable year, the
aggregate amount (including administrative
expenses) which would have been allowable as a
deduction to the employer with respect to the
benefits provided during the taxable year, if--
(i) such benefits were provided
directly by the employer, and
(ii) the employer used the cash receipts
and disbursements method of accounting.
(B) Time when benefits provided.--For
purposes of subparagraph (A), a benefit shall be
treated as provided when such benefit would be
includible in the gross income of the employee if
provided directly by the employer (or would be so
includible but for any provision of this chapter
excluding such benefit from gross income).
* * * * * * *
(d) Carryover of Excess Contributions.--If--
(1) the amount of the contributions paid (or
deemed paid under this subsection) by the employer
during any taxable year to a welfare benefit fund,
exceeds
(2) the limitation of subsection (b),
Page: Previous 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NextLast modified: May 25, 2011