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Coal Industry Successor in Interest Safe Harbor

IRC §9701

Purchasers of coal assets or stock are excluded from being 'successors in interest' (and thus avoid associated retiree health liabilities) if they are unrelated to the seller and purchase assets at fair market value in an arm's-length sale.

Eligibility

Applies to entities purchasing assets or stock from an assigned operator in the coal industry, provided the purchaser is an unrelated person under section 267(b).

Frequently Asked Questions

Who is eligible for the Coal Industry Successor in Interest Safe Harbor?

Applies to entities purchasing assets or stock from an assigned operator in the coal industry, provided the purchaser is an unrelated person under section 267(b).

How does the Coal Industry Successor in Interest Safe Harbor work?

Purchasers of coal assets or stock are excluded from being 'successors in interest' (and thus avoid associated retiree health liabilities) if they are unrelated to the seller and purchase assets at fair market value in an arm's-length sale.

What law authorizes the Coal Industry Successor in Interest Safe Harbor?

The Coal Industry Successor in Interest Safe Harbor is authorized under IRC §9701 of the Internal Revenue Code (Title 26, United States Code).

Statutory Text — IRC §9701

Source: Internal Revenue Code, Title 26, United States Code

§ 9701. Definitions of general applicability(a) Plans and fundsFor purposes of this chapter—(1) UMWA Benefit Plan(A) In generalThe term “UMWA Benefit Plan” means a plan—(i) which is described in section 404(c), or a continuation thereof; and (ii) which provides health benefits to retirees and beneficiaries of the industry which maintained the 1950 UMWA Pension Plan. (B) 1950 UMWA Benefit PlanThe term “1950 UMWA Benefit Plan” means a UMWA Benefit Plan, participation in which is substantially limited to individuals who retired before 1976. (C) 1974 UMWA Benefit PlanThe term “1974 UMWA Benefit Plan” means a UMWA Benefit Plan, participation in which is substantially limited to individuals who retired on or after January 1, 1976. (2) 1950 UMWA Pension PlanThe term “1950 UMWA Pension Plan” means a pension plan described in section 404(c) (or a continuation thereof), participation in which is substantially limited to individuals who retired before 1976. (3) 1974 UMWA Pension PlanThe term “1974 UMWA Pension Plan” means a pension plan described in section 404(c) (or a continuation thereof), participation in which is substantially limited to individuals who retired in 1976 and thereafter. (4) 1992 UMWA Benefit PlanThe term “1992 UMWA Benefit Plan” means the plan referred to in section 9712. (5) Combined FundThe term “Combined Fund” means the United Mine Workers of America Combined Benefit Fund established under section 9702. (b) AgreementsFor purposes of this section—(1) Coal wage agreementThe term “coal wage agreement” means—(A) the National Bituminous Coal Wage Agreement, or (B) any other agreement entered into between an employer in the coal industry and the United Mine Workers of America that required or requires one or both of the following:(i) the provision of health benefits to retirees of such employer, eligibility for which is based on years of service credited under a plan established by the settlors and described in section 404(c) or a continuation of such plan; or (ii) contributions to the 1950 UMWA Benefit Plan or the 1974 UMWA Benefit Plan, or any predecessor thereof. (2) SettlorsThe term “settlors” means the United Mine Workers of America and the Bituminous Coal Operators’ Association, Inc. (referred to in this chapter as the “BCOA”). (3) National Bituminous Coal Wage AgreementThe term “National Bituminous Coal Wage Agreement” means a collective bargaining agreement negotiated by the BCOA and the United Mine Workers of America. (c) Terms relating to operatorsFor purposes of this section—(1) Signatory operatorThe term “signatory operator” means a person which is or was a signatory to a coal wage agreement. (2) Related persons(A) In generalA person shall be considered to be a related person to a signatory operator if that person is—(i) a member of the controlled group of corporations (within the meaning of section 52(a)) which includes such signatory operator;

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