### Question
How is the "applicable health benefits" defined?


### Answer
The term **applicable health benefits** is defined in *26 U.S.C. § 420* as follows -

> health benefits or coverage which are provided to—


(i) retired employees who, immediately before the qualified transfer, are entitled to receive such benefits upon retirement and who are entitled to pension benefits under the plan, and


(ii) their spouses and dependents

#### Citation:
  - *26 U.S.C. § 420*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter D-Deferred Compensation, Etc. > PART I-PENSION, PROFIT-SHARING, STOCK BONUS PLANS, ETC. > Subpart E-Treatment of Transfers to Retiree Health Accounts**

