to whether the employer is a covered employer) with respect to any of the first 3 calendar years for which the employer could adopt such an arrangement, and subsequently adopts an eligible employer plan for its employees for any of those years which it maintains throughout such 3-calendar-year period, then section 45E(b)(1) shall be applied with respect to the eligible employer by substituting 3 taxable years for 2 taxable years . (c) Definitions For purposes of this section— (1) Eligible employer The term eligible employer means, with respect to the calendar year in which the taxable year begins, an employer which— (A) maintains a qualifying automatic IRA arrangement meeting the requirements of section 408B (without regard to whether the employer is a covered employer), (B) on each day during the preceding calendar year, had no more than 100 employees, and (C) did not maintain a qualifying plan or arrangement (described in section 408B(b)) during the portion of the calendar year preceding the adoption of the qualifying automatic IRA arrangement and the 2 preceding calendar years. (2) Credit period The term credit period means the first 6 calendar years in which the eligible employer maintains the qualifying automatic IRA arrangement. (d) Other rules For purposes of this section, the rules of section 45E(e) shall apply. . (b) Credit allowed as part of general business credit Section 38(b) of the Internal Revenue Code of 1986 is amended by striking plus at the end of paragraph (35), by striking the period at the end of paragraph (36) and inserting , plus , and by adding at the end the following new paragraph: (37) the small employer automatic IRA arrangement credit determined under section 45S(a). . (c) Clerical amendment The table of sections for subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item: Sec. 45S. Small employer automatic IRA arrangement. . (d) Effective date The amendments made by this section shall apply to