calendar year and it is not reasonable to assume that an employer contribution will be made for the last plan year ending in the preceding calendar year. (3) Exception for certain small and new employers The term covered employer does not include an employer for a calendar year if the employer either— (A) did not employ more than 10 employees who received at least $5,000 of compensation (as defined in section 3401(a)) from the employer for the preceding calendar year, (B) did not normally employ more than 10 employees on a typical business day of the preceding calendar year, or (C) was not in existence at all times during the calendar year and the preceding calendar year. (4) Exception for governments and churches The term covered employer does not include— (A) a government or entity described in section 414(d), or (B) a church or a convention or association of churches which is exempt from tax under section 501. (5) Aggregation rule All persons treated as a single employer under subsection (a) or (b) of section 52 or subsection (m) or (o) of section 414 shall be treated as a single employer. (6) Operating rules In determining the number of employees for purposes of this section— (A) rules consistent with any rules applicable in determining the number of employees for purposes of section 408(p)(2)(C) and section 4980B(d) shall apply, (B) all members of the same family (within the meaning of section 318(a)(1)) shall be treated as 1 individual, and (C) any reference to an employer shall include a reference to any predecessor employer. (c) Qualifying employee For purposes of this section— (1) In general The term qualifying employee means any employee of the employer who is not an excluded employee. (2) Plan sponsor’s employees If— (A) an employer maintains one or more qualifying plans or arrangements described in section 219(g)(5), and (B) the employees of a subsidiary, division, or other major business unit are generally not eligible to participate in any such qualifying plan or arrangement, then, for purposes of