existing excess reserve
(7) Adjustments for existing excess reserves (A) Increase in account limit The account limit for any of the first 4 taxable years to which this section applies shall be increased by the applicable percentage of any existing excess reserves. (B) Applicable percentage For purposes of subparagraph (A)— In the case of: The applicable percentage is: The first taxable year to which this section applies 80 The second taxable year to which this section applies 60 The third taxable year to which this section applies 40 The fourth taxable year to which this section applies 20. (C) Existing excess reserve For purposes of computing the increase under subparagraph (A) for any taxable year, the term “existing excess reserve” means the excess (if any) of— (i) the amount of assets set aside at the close of the first taxable year ending after July 18, 1984 , for purposes described in subsection (a), over (ii) the account limit determined under this section (without regard to this paragraph) for the taxable year for which such increase is being computed. (D) Funds to which paragraph applies This paragraph shall apply only to a welfare benefit fund which, as of July 18, 1984 , had assets set aside for purposes described in subsection (a).