Setting Every Community Up for Retirement Enhancement Act of 2019
This bill modifies the requirements for employer-provided retirement plans, individual retirement accounts (IRAs), and other tax-favored savings accounts.
With respect to employer-provided retirement plans, the bill modifies requirements regarding
The bill also includes provisions that
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1994 Introduced in House (IH)]
<DOC>
116th CONGRESS
1st Session
H. R. 1994
To amend the Internal Revenue Code of 1986 to encourage retirement
savings, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 29, 2019
Mr. Neal (for himself, Mr. Brady, Mr. Kind, and Mr. Kelly of
Pennsylvania) introduced the following bill; which was referred to the
Committee on Ways and Means, and in addition to the Committee on
Education and Labor, for a period to be subsequently determined by the
Speaker, in each case for consideration of such provisions as fall
within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to encourage retirement
savings, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE, ETC.
(a) Short Title.--This Act may be cited as the ``Setting Every
Community Up for Retirement Enhancement Act of 2019''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title, etc.
TITLE I--EXPANDING AND PRESERVING RETIREMENT SAVINGS
Sec. 101. Increase in 10 percent cap for automatic enrollment safe
harbor after 1st plan year.
Sec. 102. Rules relating to election of safe harbor 401(k) status.
Sec. 103. Increase in credit limitation for small employer pension plan
startup costs.
Sec. 104. Small employer automatic enrollment credit.
Sec. 105. Certain taxable non-tuition fellowship and stipend payments
treated as compensation for IRA purposes.
Sec. 106. Repeal of maximum age for traditional IRA contributions.
Sec. 107. Qualified employer plans prohibited from making loans through
credit cards and other similar
arrangements.
Sec. 108. Portability of lifetime income options.
Sec. 109. Treatment of custodial accounts on termination of section
403(b) plans.
Sec. 110. Clarification of retirement income account rules relating to
church-controlled organizations.
Sec. 111. Qualified cash or deferred arrangements must allow long-term
employees working more than 500 but less
than 1,000 hours per year to participate.
Sec. 112. Penalty-free withdrawals from retirement plans for
individuals in case of birth of child or
adoption.
Sec. 113. Increase in age for required beginning date for mandatory
distributions.
Sec. 114. Special rules for minimum funding standards for community
newspaper plans.
Sec. 115. Treating excluded difficulty of care payments as compensation
for determining retirement contribution
limitations.
TITLE II--ADMINISTRATIVE IMPROVEMENTS
Sec. 201. Plan adopted by filing due date for year may be treated as in
effect as of close of year.
Sec. 202. Combined annual report for group of plans.
Sec. 203. Disclosure regarding lifetime income.
Sec. 204. Fiduciary safe harbor for selection of lifetime income
provider.
Sec. 205. Modification of nondiscrimination rules to protect older,
longer service participants.
TITLE III--OTHER BENEFITS
Sec. 301. Benefits provided to volunteer firefighters and emergency
medical responders.
Sec. 302. Expansion of section 529 plans.
TITLE IV--REVENUE PROVISIONS
Sec. 401. Modifications of required distribution rules for designated
beneficiaries.
Sec. 402. Increase in penalty for failure to file.
Sec. 403. Increased penalties for failure to file retirement plan
returns.
Sec. 404. Increase information sharing to administer excise taxes.
TITLE I--EXPANDING AND PRESERVING RETIREMENT SAVINGS
SEC. 101. INCREASE IN 10 PERCENT CAP FOR AUTOMATIC ENROLLMENT SAFE
HARBOR AFTER 1ST PLAN YEAR.
(a) In General.--Section 401(k)(13)(C)(iii) of the Internal Revenue
Code of 1986 is amended by striking ``does not exceed 10 percent'' and
inserting ``does not exceed 15 percent (10 percent during the period
described in subclause (I))''.
(b) Effective Date.--The amendments made by this section shall
apply to plan years beginning after December 31, 2019.
SEC. 102. RULES RELATING TO ELECTION OF SAFE HARBOR 401(K) STATUS.
(a) Limitation of Annual Safe Harbor Notice to Matching
Contribution Plans.--
(1) In general.--Subparagraph (A) of section 401(k)(12) of
the Internal Revenue Code of 1986 is amended by striking ``if
such arrangement'' and all that follows and inserting ``if such
arrangement--
``(i) meets the contribution requirements
of subparagraph (B) and the notice requirements
of subparagraph (D), or
``(ii) meets the contribution requirements
of subparagraph (C).''.
(2) Automatic contribution arrangements.--Subparagraph (B)
of section 401(k)(13) of such Code is amended by striking
``means'' and all that follows and inserting ``means a cash or
deferred arrangement--
``(A) which is described in subparagraph (D)(i)(I)
and meets the applicable requirements of subparagraphs
(C) through (E), or
``(B) which is described in subparagraph (D)(i)(II)
and meets the applicable requirements of subparagraphs
(C) and (D).''.
(b) Nonelective Contributions.--Section 401(k)(12) of the Internal
Revenue Code of 1986 is amended by redesignating subparagraph (F) as
subparagraph (G), and by inserting after subparagraph (E) the following
new subparagraph:
``(F) Timing of plan amendment for employer making
nonelective contributions.--
``(i) In general.--Except as provided in
clause (ii), a plan may be amended after the
beginning of a plan year to provide that the
requirements of subparagraph (C) shall apply to
the arrangement for the plan year, but only if
the amendment is adopted--
``(I) at any time before the 30th
day before the close of the plan year,
or
``(II) at any time before the last
day under paragraph (8)(A) for
distributing excess contributions for
the plan year.
``(ii) Exception where plan provided for
matching contributions.--Clause (i) shall not
apply to any plan year if the plan provided at
any time during the plan year that the
requirements of subparagraph (B) or paragraph
(13)(D)(i)(I) applied to the plan year.
``(iii) 4-percent contribution
requirement.--Clause (i)(II) shall not apply to
an arrangement unless the amount of the
contributions described in subparagraph (C)
which the employer is required to make under
the arrangement for the plan year with respect
to any employee is an amount equal to at least
4 percent of the employee's compensation.''.
(c) Automatic Contribution Arrangements.--Section 401(k)(13) of the
Internal Revenue Code of 1986 is amended by adding at the end the
following:
``(F) Timing of plan amendment for employer making
nonelective contributions.--
``(i) In general.--Except as provided in
clause (ii), a plan may be amended after the
beginning of a plan year to provide that the
requirements of subparagraph (D)(i)(II) shall
apply to the arrangement for the plan year, but
only if the amendment is adopted--
``(I) at any time before the 30th
day before the close of the plan year,
or
``(II) at any time before the last
day under paragraph (8)(A) for
distributing excess contributions for
the plan year.
``(ii) Exception where plan provided for
matching contributions.--Clause (i) shall not
apply to any plan year if the plan provided at
any time during the plan year that the
requirements of subparagraph (D)(i)(I) or
paragraph (12)(B) applied to the plan year.
``(iii) 4-percent contribution
requirement.--Clause (i)(II) shall not apply to
an arrangement unless the amount of the
contributions described in subparagraph
(D)(i)(II) which the employer is required to
make under the arrangement for the plan year
with respect to any employee is an amount equal
to at least 4 percent of the employee's
compensation.''.
(d) Effective Date.--The amendments made by this section shall
apply to plan years beginning after December 31, 2019.
SEC. 103. INCREASE IN CREDIT LIMITATION FOR SMALL EMPLOYER PENSION PLAN
STARTUP COSTS.
(a) In General.--Paragraph (1) of section 45E(b) of the Internal
Revenue Code of 1986 is amended to read as follows:
``(1) for the first credit year and each of the 2 taxable
years immediately following the first credit year, the greater
of--
``(A) $500, or
``(B) the lesser of--
``(i) $250 for each employee of the
eligible employer who is not a highly
compensated employee (as defined in section
414(q)) and who is eligible to participate in
the eligible employer plan maintained by the
eligible employer, or
``(ii) $5,000, and''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2019.
SEC. 104. SMALL EMPLOYER AUTOMATIC ENROLLMENT CREDIT.
(a) In General.--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 section:
``SEC. 45T. AUTO-ENROLLMENT OPTION FOR RETIREMENT SAVINGS OPTIONS
PROVIDED BY SMALL EMPLOYERS.
``(a) In General.--For purposes of section 38, in the case of an
eligible employer, the retirement auto-enrollment credit determined
under this section for any taxable year is an amount equal to--
``(1) $500 for any taxable year occurring during the credit
period, and
``(2) zero for any other taxable year.
``(b) Credit Period.--For purposes of subsection (a)--
``(1) In general.--The credit period with respect to any
eligible employer is the 3-taxable-year period beginning with
the first taxable year for which the employer includes an
eligible automatic contribution arrangement (as defined in
section 414(w)(3)) in a qualified employer plan (as defined in
section 4972(d)) sponsored by the employer.
``(2) Maintenance of arrangement.--No taxable year with
respect to an employer shall be treated as occurring within the
credit period unless the arrangement described in paragraph (1)
is included in the plan for such year.
``(c) Eligible Employer.--For purposes of this section, the term
`eligible employer' has the meaning given such term in section
408(p)(2)(C)(i).''.
(b) Credit To Be Part of General Business Credit.--Subsection (b)
of section 38 of the Internal Revenue Code of 1986 is amended by
striking ``plus'' at the end of paragraph (31), by striking the period
at the end of paragraph (32) and inserting ``, plus'', and by adding at
the end the following new paragraph:
``(33) in the case of an eligible employer (as defined in
section 45T(c)), the retirement auto-enrollment credit
determined under section 45T(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 inserting after the item relating to section 45S the
following new item:
``Sec. 45T. Auto-enrollment option for retirement savings options
provided by small employers.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2019.
SEC. 105. CERTAIN TAXABLE NON-TUITION FELLOWSHIP AND STIPEND PAYMENTS
TREATED AS COMPENSATION FOR IRA PURPOSES.
(a) In General.--Paragraph (1) of section 219(f) of the Internal
Revenue Code of 1986 is amended by adding at the end the following:
``The term `compensation' shall include any amount which is included in
the individual's gross income and paid to the individual to aid the
individual in the pursuit of graduate or postdoctoral study.''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2019.
SEC. 106. REPEAL OF MAXIMUM AGE FOR TRADITIONAL IRA CONTRIBUTIONS.
(a) In General.--Paragraph (1) of section 219(d) of the Internal
Revenue Code of 1986 is repealed.
(b) Conforming Amendment.--Subsection (c) of section 408A of the
Internal Revenue Code of 1986 is amended by striking paragraph (4) and
by redesignating paragraphs (5), (6), and (7) as paragraphs (4), (5),
and (6), respectively.
(c) Effective Date.--The amendments made by this section shall
apply to contributions made for taxable years beginning after December
31, 2019.
SEC. 107. QUALIFIED EMPLOYER PLANS PROHIBITED FROM MAKING LOANS THROUGH
CREDIT CARDS AND OTHER SIMILAR ARRANGEMENTS.
(a) In General.--Paragraph (2) of section 72(p) of the Internal
Revenue Code of 1986 is amended by redesignating subparagraph (D) as
subparagraph (E) and by inserting after subparagraph (C) the following
new subparagraph:
``(D) Prohibition of loans through credit cards and
other similar arrangements.--Subparagraph (A) shall not
apply to any loan which is made through the use of any
credit card or any other similar arrangement.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to loans made after the date of the enactment of this Act.
SEC. 108. PORTABILITY OF LIFETIME INCOME OPTIONS.
(a) In General.--Subsection (a) of section 401 of the Internal
Revenue Code of 1986 is amended by inserting after paragraph (37) the
following new paragraph:
``(38) Portability of lifetime income.--
``(A) In general.--Except as may be otherwise
provided by regulations, a trust forming part of a
defined contribution plan shall not be treated as
failing to constitute a qualified trust under this
section solely by reason of allowing--
``(i) qualified distributions of a lifetime
income investment, or
``(ii) distributions of a lifetime income
investment in the form of a qualified plan
distribution annuity contract,
on or after the date that is 90 days prior to the date
on which such lifetime income investment is no longer
authorized to be held as an investment option under the
plan.
``(B) Definitions.--For purposes of this
subsection--
``(i) the term `qualified distribution'
means a direct trustee-to-trustee transfer
described in paragraph (31)(A) to an eligible
retirement plan (as defined in section
402(c)(8)(B)),
``(ii) the term `lifetime income
investment' means an investment option which is
designed to provide an employee with election
rights--
``(I) which are not uniformly
available with respect to other
investment options under the plan, and
``(II) which are to a lifetime
income feature available through a
contract or other arrangement offered
under the plan (or under another
eligible retirement plan (as so
defined), if paid by means of a direct
trustee-to-trustee transfer described
in paragraph (31)(A) to such other
eligible retirement plan),
``(iii) the term `lifetime income feature'
means--
``(I) a feature which guarantees a
minimum level of income annually (or
more frequently) for at least the
remainder of the life of the employee
or the joint lives of the employee and
the employee's designated beneficiary,
or
``(II) an annuity payable on behalf
of the employee under which payments
are made in substantially equal
periodic payments (not less frequently
than annually) over the life of the
employee or the joint lives of the
employee and the employee's designated
beneficiary, and
``(iv) the term `qualified plan
distribution annuity contract' means an annuity
contract purchased for a participant and
distributed to the participant by a plan or
contract described in subparagraph (B) of
section 402(c)(8) (without regard to clauses
(i) and (ii) thereof).''.
(b) Cash or Deferred Arrangement.--
(1) In general.--Clause (i) of section 401(k)(2)(B) of the
Internal Revenue Code of 1986 is amended by striking ``or'' at
the end of subclause (IV), by striking ``and'' at the end of
subclause (V) and inserting ``or'', and by adding at the end
the following new subclause:
``(VI) except as may be otherwise
provided by regulations, with respect
to amounts invested in a lifetime
income investment (as defined in
subsection (a)(38)(B)(ii)), the date
that is 90 days prior to the date that
such lifetime income investment may no
longer be held as an investment option
under the arrangement, and''.
(2) Distribution requirement.--Subparagraph (B) of section
401(k)(2) of such Code, as amended by paragraph (1), is amended
by striking ``and'' at the end of clause (i), by striking the
semicolon at the end of clause (ii) and inserting ``, and'',
and by adding at the end the following new clause:
``(iii) except as may be otherwise provided
by regulations, in the case of amounts
described in clause (i)(VI), will be
distributed only in the form of a qualified
distribution (as defined in subsection
(a)(38)(B)(i)) or a qualified plan distribution
annuity contract (as defined in subsection
(a)(38)(B)(iv)),''.
(c) Section 403(b) Plans.--
(1) Annuity contracts.--Paragraph (11) of section 403(b) of
the Internal Revenue Code of 1986 is amended by striking ``or''
at the end of subparagraph (B), by striking the period at the
end of subparagraph (C) and inserting ``, or'', and by
inserting after subparagraph (C) the following new
subparagraph:
``(D) except as may be otherwise provided by
regulations, with respect to amounts invested in a
lifetime income investment (as defined in section
401(a)(38)(B)(ii))--
``(i) on or after the date that is 90 days
prior to the date that such lifetime income
investment may no longer be held as an
investment option under the contract, and
``(ii) in the form of a qualified
distribution (as defined in section
401(a)(38)(B)(i)) or a qualified plan
distribution annuity contract (as defined in
section 401(a)(38)(B)(iv)).''.
(2) Custodial accounts.--Subparagraph (A) of section
403(b)(7) of such Code is amended by striking ``if--'' and all
that follows and inserting ``if the amounts are to be invested
in regulated investment company stock to be held in that
custodial account, and under the custodial account--
``(i) no such amounts may be paid or made
available to any distributee (unless such
amount is a distribution to which section
72(t)(2)(G) applies) before--
``(I) the employee dies,
``(II) the employee attains age
59\1/2\,
``(III) the employee has a
severance from employment,
``(IV) the employee becomes
disabled (within the meaning of section
72(m)(7)),
``(V) in the case of contributions
made pursuant to a salary reduction
agreement (within the meaning of
section 3121(a)(5)(D)), the employee
encounters financial hardship, or
``(VI) except as may be otherwise
provided by regulations, with respect
to amounts invested in a lifetime
income investment (as defined in
section 401(a)(38)(B)(ii)), the date
that is 90 days prior to the date that
such lifetime income investment may no
longer be held as an investment option
under the contract, and
``(ii) in the case of amounts described in
clause (i)(VI), such amounts will be
distributed only in the form of a qualified
distribution (as defined in section
401(a)(38)(B)(i)) or a qualified plan
distribution annuity contract (as defined in
section 401(a)(38)(B)(iv)).''.
(d) Eligible Deferred Compensation Plans.--
(1) In general.--Subparagraph (A) of section 457(d)(1) of
the Internal Revenue Code of 1986 is amended by striking ``or''
at the end of clause (ii), by inserting ``or'' at the end of
clause (iii), and by adding after clause (iii) the following:
``(iv) except as may be otherwise provided
by regulations, in the case of a plan
maintained by an employer described in
subsection (e)(1)(A), with respect to amounts
invested in a lifetime income investment (as
defined in section 401(a)(38)(B)(ii)), the date
that is 90 days prior to the date that such
lifetime income investment may no longer be
held as an investment option under the plan,''.
(2) Distribution requirement.--Paragraph (1) of section
457(d) of such Code is amended by striking ``and'' at the end
of subparagraph (B), by striking the period at the end of
subparagraph (C) and inserting ``, and'', and by inserting
after subparagraph (C) the following new subparagraph:
``(D) except as may be otherwise provided by
regulations, in the case of amounts described in
subparagraph (A)(iv), such amounts will be distributed
only in the form of a qualified distribution (as
defined in section 401(a)(38)(B)(i)) or a qualified
plan distribution annuity contract (as defined in
section 401(a)(38)(B)(iv)).''.
(e) Effective Date.--The amendments made by this section shall
apply to plan years beginning after December 31, 2019.
SEC. 109. TREATMENT OF CUSTODIAL ACCOUNTS ON TERMINATION OF SECTION
403(B) PLANS.
Not later than six months after the date of enactment of this Act,
the Secretary of the Treasury shall issue guidance to provide that, if
an employer terminates the plan under which amounts are contributed to
a custodial account under subparagraph (A) of section 403(b)(7), the
plan administrator or custodian may distribute an individual custodial
account in kind to a participant or beneficiary of the plan and the
distributed custodial account shall be maintained by the custodian on a
tax-deferred basis as a section 403(b)(7) custodial account, similar to
the treatment of fully-paid individual annuity contracts under Revenue
Ruling 2011-7, until amounts are actually paid to the participant or
beneficiary. The guidance shall provide further (i) that the section
403(b)(7) status of the distributed custodial account is generally
maintained if the custodial account thereafter adheres to the
requirements of section 403(b) that are in effect at the time of the
distribution of the account and (ii) that a custodial account would not
be considered distributed to the participant or beneficiary if the
employer has any material retained rights under the account (but the
employer would not be treated as retaining material rights simply
because the custodial account was originally opened under a group
contract). Such guidance shall be retroactively effective for taxable
years beginning after December 31, 2008.
SEC. 110. CLARIFICATION OF RETIREMENT INCOME ACCOUNT RULES RELATING TO
CHURCH-CONTROLLED ORGANIZATIONS.
(a) In General.--Subparagraph (B) of section 403(b)(9) of the
Internal Revenue Code of 1986 is amended by inserting ``(including an
employee described in section 414(e)(3)(B))'' after ``employee
described in paragraph (1)''.
(b) Effective Date.--The amendment made by this section shall apply
to years beginning before, on, or after the date of the enactment of
this Act.
SEC. 111. QUALIFIED CASH OR DEFERRED ARRANGEMENTS MUST ALLOW LONG-TERM
EMPLOYEES WORKING MORE THAN 500 BUT LESS THAN 1,000 HOURS
PER YEAR TO PARTICIPATE.
(a) Participation Requirement.--
(1) In general.--Section 401(k)(2)(D) of the Internal
Revenue Code of 1986 is amended to read as follows:
``(D) which does not require, as a condition of
participation in the arrangement, that an employee
complete a period of service with the employer (or
employers) maintaining the plan extending beyond the
close of the earlier of--
``(i) the period permitted under section
410(a)(1) (determined without regard to
subparagraph (B)(i) thereof), or
``(ii) subject to the provisions of
paragraph (15), the first period of 3
consecutive 12-month periods during each of
which the employee has at least 500 hours of
service.''.
(2) Special rules.--Section 401(k) of such Code is amended
by adding at the end the following new paragraph:
``(15) Special rules for participation requirement for
long-term, part-time workers.--For purposes of paragraph
(2)(D)(ii)--
``(A) Age requirement must be met.--Paragraph
(2)(D)(ii) shall not apply to an employee unless the
employee has met the requirement of section
410(a)(1)(A)(i) by the close of the last of the 12-
month periods described in such paragraph.
``(B) Nondiscrimination and top-heavy rules not to
apply.--
``(i) Nondiscrimination rules.--In the case
of employees who are eligible to participate in
the arrangement solely by reason of paragraph
(2)(D)(ii)--
``(I) notwithstanding subsection
(a)(4), an employer shall not be
required to make nonelective or
matching contributions on behalf of
such employees even if such
contributions are made on behalf of
other employees eligible to participate
in the arrangement, and
``(II) an employer may elect to
exclude such employees from the
application of subsection (a)(4),
paragraphs (3), (12), and (13),
subsection (m)(2), and section 410(b).
``(ii) Top-heavy rules.--An employer may
elect to exclude all employees who are eligible
to participate in a plan maintained by the
employer solely by reason of paragraph
(2)(D)(ii) from the application of the vesting
and benefit requirements under subsections (b)
and (c) of section 416.
``(iii) Vesting.--For purposes of
determining whether an employee described in
clause (i) has a nonforfeitable right to
employer contributions (other than
contributions described in paragraph (3)(D)(i))
under the arrangement, each 12-month period for
which the employee has at least 500 hours of
service shall be treated as a year of service.
``(iv) Employees who become full-time
employees.--This subparagraph shall cease to
apply to any employee as of the first plan year
beginning after the plan year in which the
employee meets the requirements of section
410(a)(1)(A)(ii) without regard to paragraph
(2)(D)(ii).
``(C) Exception for employees under collectively
bargained plans, etc.--Paragraph (2)(D)(ii) shall not
apply to employees described in section 410(b)(3).
``(D) Special rules.--
``(i) Time of participation.--The rules of
section 410(a)(4) shall apply to an employee
eligible to participate in an arrangement
solely by reason of paragraph (2)(D)(ii).
``(ii) 12-month periods.--12-month periods
shall be determined in the same manner as under
the last sentence of section 410(a)(3)(A).''.
(b) Effective Date.--The amendments made by this section shall
apply to plan years beginning after December 31, 2020, except that, for
purposes of section 401(k)(2)(D)(ii) of the Internal Revenue Code of
1986 (as added by such amendments), 12-month periods beginning before
January 1, 2021, shall not be taken into account.
SEC. 112. PENALTY-FREE WITHDRAWALS FROM RETIREMENT PLANS FOR
INDIVIDUALS IN CASE OF BIRTH OF CHILD OR ADOPTION.
(a) In General.--Section 72(t)(2) of the Internal Revenue Code of
1986 is amended by adding at the end the following new subparagraph:
``(H) Distributions from retirement plans in case
of birth of child or adoption.--
``(i) In general.--Any qualified birth or
adoption distribution.
``(ii) Limitation.--The aggregate amount
which may be treated as qualified birth or
adoption distributions by any individual with
respect to any birth or adoption shall not
exceed $5,000.
``(iii) Qualified birth or adoption
distribution.--For purposes of this
subparagraph--
``(I) In general.--The term
`qualified birth or adoption
distribution' means any distribution
from an applicable eligible retirement
plan to an individual if made during
the 1-year period beginning on the date
on which a child of the individual is
born or on which the legal adoption by
the individual of an eligible adoptee
is finalized.
``(II) Eligible adoptee.--The term
`eligible adoptee' means any individual
(other than a child of the taxpayer's
spouse) who has not attained age 18 or
is physically or mentally incapable of
self-support.
``(iv) Treatment of plan distributions.--
``(I) In general.--If a
distribution to an individual would
(without regard to clause (ii)) be a
qualified birth or adoption
distribution, a plan shall not be
treated as failing to meet any
requirement of this title merely
because the plan treats the
distribution as a qualified birth or
adoption distribution, unless the
aggregate amount of such distributions
from all plans maintained by the
employer (and any member of any
controlled group which includes the
employer) to such individual exceeds
$5,000.
``(II) Controlled group.--For
purposes of subclause (I), the term
`controlled group' means any group
treated as a single employer under
subsection (b), (c), (m), or (o) of
section 414.
``(v) Amount distributed may be repaid.--
``(I) In general.--Any individual
who receives a qualified birth or
adoption distribution may make one or
more contributions in an aggregate
amount not to exceed the amount of such
distribution to an applicable eligible
retirement plan of which such
individual is a beneficiary and to
which a rollover contribution of such
distribution could be made under
section 402(c), 403(a)(4), 403(b)(8),
408(d)(3), or 457(e)(16), as the case
may be.
``(II) Limitation on contributions
to applicable eligible retirement plans
other than iras.--The aggregate amount
of contributions made by an individual
under subclause (I) to any applicable
eligible retirement plan which is not
an individual retirement plan shall not
exceed the aggregate amount of
qualified birth or adoption
distributions which are made from such
plan to such individual. Subclause (I)
shall not apply to contributions to any
applicable eligible retirement plan
which is not an individual retirement
plan unless the individual is eligible
to make contributions (other than those
described in subclause (I)) to such
applicable eligible retirement plan.
``(III) Treatment of repayments of
distributions from applicable eligible
retirement plans other than iras.--If a
contribution is made under subclause
(I) with respect to a qualified birth
or adoption distribution from an
applicable eligible retirement plan
other than an individual retirement
plan, then the taxpayer shall, to the
extent of the amount of the
contribution, be treated as having
received such distribution in an
eligible rollover distribution (as
defined in section 402(c)(4)) and as
having transferred the amount to the
applicable eligible retirement plan in
a direct trustee to trustee transfer
within 60 days of the distribution.
``(IV) Treatment of repayments for
distributions from iras.--If a
contribution is made under subclause
(I) with respect to a qualified birth
or adoption distribution from an
individual retirement plan, then, to
the extent of the amount of the
contribution, such distribution shall
be treated as a distribution described
in section 408(d)(3) and as having been
transferred to the applicable eligible
retirement plan in a direct trustee to
trustee transfer within 60 days of the
distribution.
``(vi) Definition and special rules.--For
purposes of this subparagraph--
``(I) Applicable eligible
retirement plan.--The term `applicable
eligible retirement plan' means an
eligible retirement plan (as defined in
section 402(c)(8)(B)) other than a
defined benefit plan.
``(II) Exemption of distributions
from trustee to trustee transfer and
withholding rules.--For purposes of
sections 401(a)(31), 402(f), and 3405,
a qualified birth or adoption
distribution shall not be treated as an
eligible rollover distribution.
``(III) Taxpayer must include
tin.--A distribution shall not be
treated as a qualified birth or
adoption distribution with respect to
any child or eligible adoptee unless
the taxpayer includes the name, age,
and TIN of such child or eligible
adoptee on the taxpayer's return of tax
for the taxable year.
``(IV) Distributions treated as
meeting plan distribution
requirements.--Any qualified birth or
adoption distribution shall be treated
as meeting the requirements of sections
401(k)(2)(B)(i), 403(b)(7)(A)(ii),
403(b)(11), and 457(d)(1)(A).''.
(b) Effective Date.--The amendments made by this section shall
apply to distributions made after December 31, 2019.
SEC. 113. INCREASE IN AGE FOR REQUIRED BEGINNING DATE FOR MANDATORY
DISTRIBUTIONS.
(a) In General.--Section 401(a)(9)(C)(i)(I) of the Internal Revenue
Code of 1986 is amended by striking ``age 70\1/2\'' and inserting ``age
72''.
(b) Spouse Beneficiaries; Special Rule for Owners.--Subparagraphs
(B)(iv)(I) and (C)(ii)(I) of section 401(a)(9) of such Code are each
amended by striking ``age 70\1/2\'' and inserting ``age 72''.
(c) Actuarial Adjustment.--Section 401(a)(9)(C)(iii) of such Code
is amended by striking ``age 70\1/2\'' each place it appears and
inserting ``age 72''.
(d) Conforming Amendments.--
(1) The last sentence of section 408(b) of such Code is
amended by striking ``age 70\1/2\'' and inserting ``age 72''.
(2) Section 457(d)(1)(A)(i) of such Code is amended by
striking ``age 70\1/2\'' and inserting ``age 72''.
(e) Effective Date.--The amendments made by this section shall
apply to distributions required to be made after December 31, 2019,
with respect to individuals who attain age 70\1/2\ after such date.
SEC. 114. SPECIAL RULES FOR MINIMUM FUNDING STANDARDS FOR COMMUNITY
NEWSPAPER PLANS.
(a) Amendment to Internal Revenue Code of 1986.--Section 430 of the
Internal Revenue Code of 1986 is amended by adding at the end the
following new subsection:
``(m) Special Rules for Community Newspaper Plans.--
``(1) In general.--The plan sponsor of a community
newspaper plan under which no participant has had the
participant's accrued benefit increased (whether because of
service or compensation) after December 31, 2017, may elect to
have the alternative standards described in paragraph (3) apply
to such plan, and any plan sponsored by any member of the same
controlled group.
``(2) Election.--An election under paragraph (1) shall be
made at such time and in such manner as prescribed by the
Secretary. Such election, once made with respect to a plan
year, shall apply to all subsequent plan years unless revoked
with the consent of the Secretary.
``(3) Alternative minimum funding standards.--The
alternative standards described in this paragraph are the
following:
``(A) Interest rates.--
``(i) In general.--Notwithstanding
subsection (h)(2)(C) and except as provided in
clause (ii), the first, second, and third
segment rates in effect for any month for
purposes of this section shall be 8 percent.
``(ii) New benefit accruals.--
Notwithstanding subsection (h)(2), for purposes
of determining the funding target and normal
cost of a plan for any plan year, the present
value of any benefits accrued or earned under
the plan for a plan year with respect to which
an election under paragraph (1) is in effect
shall be determined on the basis of the U.S.
Treasury obligation yield curve for the day
that is the valuation date of such plan for
such plan year.
``(iii) U.S. treasury obligation yield
curve.--For purposes of this subsection, the
term `U.S. Treasury obligation yield curve'
means, with respect to any day, a yield curve
which shall be prescribed by the Secretary for
such day on interest-bearing obligations of the
United States.
``(B) Shortfall amortization base.--
``(i) Previous shortfall amortization
bases.--The shortfall amortization bases
determined under subsection (c)(3) for all plan
years preceding the first plan year to which
the election under paragraph (1) applies (and
all shortfall amortization installments
determined with respect to such bases) shall be
reduced to zero under rules similar to the
rules of subsection (c)(6).
``(ii) New shortfall amortization base.--
Notwithstanding subsection (c)(3), the
shortfall amortization base for the first plan
year to which the election under paragraph (1)
applies shall be the funding shortfall of such
plan for such plan year (determined using the
interest rates as modified under subparagraph
(A)).
``(C) Determination of shortfall amortization
installments.--
``(i) 30-year period.--Subparagraphs (A)
and (B) of subsection (c)(2) shall be applied
by substituting `30-plan-year' for `7-plan-
year' each place it appears.
``(ii) No special election.--The election
under subparagraph (D) of subsection (c)(2)
shall not apply to any plan year to which the
election under paragraph (1) applies.
``(D) Exemption from at-risk treatment.--Subsection
(i) shall not apply.
``(4) Community newspaper plan.--For purposes of this
subsection--
``(A) In general.--The term `community newspaper
plan' means a plan to which this section applies
maintained by an employer which, as of December 31,
2017--
``(i) publishes and distributes daily,
either electronically or in printed form, 1 or
more community newspapers in a single State,
``(ii) is not a company the stock of which
is publicly traded (on a stock exchange or in
an over-the-counter market), and is not
controlled, directly or indirectly, by such a
company,
``(iii) is controlled, directly or
indirectly--
``(I) by 1 or more persons residing
primarily in the State in which the
community newspaper is published,
``(II) for not less than 30 years
by individuals who are members of the
same family,
``(III) by a trust created or
organized in the State in which the
community newspaper is published, the
sole trustees of which are persons
described in subclause (I) or (II),
``(IV) by an entity which is
described in section 501(c)(3) and
exempt from taxation under section
501(a), which is organized and operated
in the State in which the community
newspaper is published, and the primary
purpose of which is to benefit
communities in such State, or
``(V) by a combination of persons
described in subclause (I), (III), or
(IV), and
``(iv) does not control, directly or
indirectly, any newspaper in any other State.
``(B) Community newspaper.--The term `community
newspaper' means a newspaper which primarily serves a
metropolitan statistical area, as determined by the
Office of Management and Budget, with a population of
not less than 100,000.
``(C) Control.--A person shall be treated as
controlled by another person if such other person
possesses, directly or indirectly, the power to direct
or cause the direction and management of such person
(including the power to elect a majority of the members
of the board of directors of such person) through the
ownership of voting securities.
``(5) Controlled group.--For purposes of this subsection,
the term `controlled group' means all persons treated as a
single employer under subsection (b), (c), (m), or (o) of
section 414 as of the date of the enactment of this
subsection.''.
(b) Amendment to Employee Retirement Income Security Act of 1974.--
Section 303 of the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1083) is amended by adding at the end the following new
subsection:
``(m) Special Rules for Community Newspaper Plans.--
``(1) In general.--The plan sponsor of a community
newspaper plan under which no participant has had the
participant's accrued benefit increased (whether because of
service or compensation) after December 31, 2017, may elect to
have the alternative standards described in paragraph (3) apply
to such plan, and any plan sponsored by any member of the same
controlled group.
``(2) Election.--An election under paragraph (1) shall be
made at such time and in such manner as prescribed by the
Secretary of the Treasury. Such election, once made with
respect to a plan year, shall apply to all subsequent plan
years unless revoked with the consent of the Secretary of the
Treasury.
``(3) Alternative minimum funding standards.--The
alternative standards described in this paragraph are the
following:
``(A) Interest rates.--
``(i) In general.--Notwithstanding
subsection (h)(2)(C) and except as provided in
clause (ii), the first, second, and third
segment rates in effect for any month for
purposes of this section shall be 8 percent.
``(ii) New benefit accruals.--
Notwithstanding subsection (h)(2), for purposes
of determining the funding target and normal
cost of a plan for any plan year, the present
value of any benefits accrued or earned under
the plan for a plan year with respect to which
an election under paragraph (1) is in effect
shall be determined on the basis of the U.S.
Treasury obligation yield curve for the day
that is the valuation date of such plan for
such plan year.
``(iii) U.S. treasury obligation yield
curve.--For purposes of this subsection, the
term `U.S. Treasury obligation yield curve'
means, with respect to any day, a yield curve
which shall be prescribed by the Secretary of
the Treasury for such day on interest-bearing
obligations of the United States.
``(B) Shortfall amortization base.--
``(i) Previous shortfall amortization
bases.--The shortfall amortization bases
determined under subsection (c)(3) for all plan
years preceding the first plan year to which
the election under paragraph (1) applies (and
all shortfall amortization installments
determined with respect to such bases) shall be
reduced to zero under rules similar to the
rules of subsection (c)(6).
``(ii) New shortfall amortization base.--
Notwithstanding subsection (c)(3), the
shortfall amortization base for the first plan
year to which the election under paragraph (1)
applies shall be the funding shortfall of such
plan for such plan year (determined using the
interest rates as modified under subparagraph
(A)).
``(C) Determination of shortfall amortization
installments.--
``(i) 30-year period.--Subparagraphs (A)
and (B) of subsection (c)(2) shall be applied
by substituting `30-plan-year' for `7-plan-
year' each place it appears.
``(ii) No special election.--The election
under subparagraph (D) of subsection (c)(2)
shall not apply to any plan year to which the
election under paragraph (1) applies.
``(D) Exemption from at-risk treatment.--Subsection
(i) shall not apply.
``(4) Community newspaper plan.--For purposes of this
subsection--
``(A) In general.--The term `community newspaper
plan' means a plan to which this section applies
maintained by an employer which, as of December 31,
2017--
``(i) publishes and distributes daily,
either electronically or in printed form--
``(I) a community newspaper, or
``(II) 1 or more community
newspapers in the same State,
``(ii) is not a company the stock of which
is publicly traded (on a stock exchange or in
an over-the-counter market), and is not
controlled, directly or indirectly, by such a
company,
``(iii) is controlled, directly or
indirectly--
``(I) by 1 or more persons residing
primarily in the State in which the
community newspaper is published,
``(II) for not less than 30 years
by individuals who are members of the
same family,
``(III) by a trust created or
organized in the State in which the
community newspaper is published, the
sole trustees of which are persons
described in subclause (I) or (II),
``(IV) by an entity which is
described in section 501(c)(3) of the
Internal Revenue Code of 1986 and
exempt from taxation under section
501(a) of such Code, which is organized
and operated in the State in which the
community newspaper is published, and
the primary purpose of which is to
benefit communities in such State, or
``(V) by a combination of persons
described in subclause (I), (III), or
(IV), and
``(iv) does not control, directly or
indirectly, any newspaper in any other State.
``(B) Community newspaper.--The term `community
newspaper' means a newspaper which primarily serves a
metropolitan statistical area, as determined by the
Office of Management and Budget, with a population of
not less than 100,000.
``(C) Control.--A person shall be treated as
controlled by another person if such other person
possesses, directly or indirectly, the power to direct
or cause the direction and management of such person
(including the power to elect a majority of the members
of the board of directors of such person) through the
ownership of voting securities.
``(5) Controlled group.--For purposes of this subsection,
the term `controlled group' means all persons treated as a
single employer under subsection (b), (c), (m), or (o) of
section 414 of the Internal Revenue Code of 1986 as of the date
of the enactment of this subsection.
``(6) Effect on premium rate calculation.--Notwithstanding
any other provision of law or any regulation issued by the
Pension Benefit Guaranty Corporation, in the case of a
community newspaper plan which elects the application of the
alternative standards described in paragraph (3), the
additional premium under section 4006(a)(3)(E) shall be
determined as if such election had not been made.''.
(c) Effective Date.--The amendments made by this section shall
apply to plan years ending after December 31, 2017.
SEC. 115. TREATING EXCLUDED DIFFICULTY OF CARE PAYMENTS AS COMPENSATION
FOR DETERMINING RETIREMENT CONTRIBUTION LIMITATIONS.
(a) Individual Retirement Accounts.--
(1) In general.--Section 408(o) of the Internal Revenue
Code of 1986 is amended by adding at the end the following new
paragraph:
``(5) Special rule for difficulty of care payments excluded
from gross income.--In the case of an individual who for a
taxable year excludes from gross income under section 131 a
qualified foster care payment which is a difficulty of care
payment, if--
``(A) the deductible amount in effect for the
taxable year under subsection (b), exceeds
``(B) the amount of compensation includible in the
individual's gross income for the taxable year,
the individual may elect to increase the nondeductible limit
under paragraph (2) for the taxable year by an amount equal to
the lesser of such excess or the amount so excluded.''.
(2) Effective date.--The amendments made by this subsection
shall apply to contributions after the date of the enactment of
this Act.
(b) Defined Contribution Plans.--
(1) In general.--Section 415(c) of such Code is amended by
adding at the end the following new paragraph:
``(8) Special rule for difficulty of care payments excluded
from gross income.--
``(A) In general.--For purposes of paragraph
(1)(B), in the case of an individual who for a taxable
year excludes from gross income under section 131 a
qualified foster care payment which is a difficulty of
care payment, the participant's compensation, or earned
income, as the case may be, shall be increased by the
amount so excluded.
``(B) Contributions allocable to difficulty of care
payments treated as after-tax.--Any contribution by the
participant which is allowable due to such increase--
``(i) shall be treated for purposes of this
title as investment in the contract, and
``(ii) shall not cause a plan (and any
arrangement which is part of such plan) to be
treated as failing to meet any requirements of
this chapter solely by reason of allowing any
such contributions.''.
(2) Effective date.--The amendment made by this subsection
shall apply to plan years beginning after December 31, 2015.
TITLE II--ADMINISTRATIVE IMPROVEMENTS
SEC. 201. PLAN ADOPTED BY FILING DUE DATE FOR YEAR MAY BE TREATED AS IN
EFFECT AS OF CLOSE OF YEAR.
(a) In General.--Subsection (b) of section 401 of the Internal
Revenue Code of 1986 is amended--
(1) by striking ``Retroactive Changes in Plan.--A stock
bonus'' and inserting ``Plan Amendments.--
``(1) Certain retroactive changes in plan.--A stock
bonus''; and
(2) by adding at the end the following new paragraph:
``(2) Adoption of plan.--If an employer adopts a stock
bonus, pension, profit-sharing, or annuity plan after the close
of a taxable year but before the time prescribed by law for
filing the return of the employer for the taxable year
(including extensions thereof), the employer may elect to treat
the plan as having been adopted as of the last day of the
taxable year.''.
(b) Effective Date.--The amendments made by this section shall
apply to plans adopted for taxable years beginning after December 31,
2019.
SEC. 202. COMBINED ANNUAL REPORT FOR GROUP OF PLANS.
(a) In General.--The Secretary of the Treasury and the Secretary of
Labor shall, in cooperation, modify the returns required under section
6058 of the Internal Revenue Code of 1986 and the reports required by
section 104 of the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1024) so that all members of a group of plans described in
subsection (c) may file a single aggregated annual return or report
satisfying the requirements of both such sections.
(b) Administrative Requirements.--In developing the consolidated
return or report under subsection (a), the Secretary of the Treasury
and the Secretary of Labor may require such return or report to include
any information regarding each plan in the group as such Secretaries
determine is necessary or appropriate for the enforcement and
administration of the Internal Revenue Code of 1986 and the Employee
Retirement Income Security Act of 1974.
(c) Plans Described.--A group of plans is described in this
subsection if all plans in the group--
(1) are individual account plans or defined contribution
plans (as defined in section 3(34) of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1002(34)) or in section
414(i) of the Internal Revenue Code of 1986);
(2) have--
(A) the same trustee (as described in section
403(a) of such Act (29 U.S.C. 1103(a)));
(B) the same one or more named fiduciaries (as
described in section 402(a) of such Act (29 U.S.C.
1102(a)));
(C) the same administrator (as defined in section
3(16)(A) of such Act (29 U.S.C. 1002(16)(A))) and plan
administrator (as defined in section 414(g) of the
Internal Revenue Code of 1986); and
(D) plan years beginning on the same date; and
(3) provide the same investments or investment options to
participants and beneficiaries.
A plan not subject to title I of the Employee Retirement Income
Security Act of 1974 shall be treated as meeting the requirements of
paragraph (2) as part of a group of plans if the same person that
performs each of the functions described in such paragraph, as
applicable, for all other plans in such group performs each of such
functions for such plan.
(d) Clarification Relating to Electronic Filing of Returns for
Deferred Compensation Plans.--
(1) In general.--Section 6011(e) of the Internal Revenue
Code of 1986 is amended by adding at the end the following new
paragraph:
``(6) Application of numerical limitation to returns
relating to deferred compensation plans.--For purposes of
applying the numerical limitation under paragraph (2)(A) to any
return required under section 6058, information regarding each
plan for which information is provided on such return shall be
treated as a separate return.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to returns required to be filed with respect to
plan years beginning after December 31, 2019.
(e) Effective Date.--The modification required by subsection (a)
shall be implemented not later than January 1, 2022, and shall apply to
returns and reports for plan years beginning after December 31, 2021.
SEC. 203. DISCLOSURE REGARDING LIFETIME INCOME.
(a) In General.--Subparagraph (B) of section 105(a)(2) of the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1025(a)(2))
is amended--
(1) in clause (i), by striking ``and'' at the end;
(2) in clause (ii), by striking ``diversification.'' and
inserting ``diversification, and''; and
(3) by inserting at the end the following:
``(iii) the lifetime income disclosure
described in subparagraph (D)(i).
In the case of pension benefit statements described in
clause (i) of paragraph (1)(A), a lifetime income
disclosure under clause (iii) of this subparagraph
shall be required to be included in only one pension
benefit statement during any one 12-month period.''.
(b) Lifetime Income.--Paragraph (2) of section 105(a) of the
Employee Retirement Income Security Act of 1974 (29 U.S.C. 1025(a)) is
amended by adding at the end the following new subparagraph:
``(D) Lifetime income disclosure.--
``(i) In general.--
``(I) Disclosure.--A lifetime
income disclosure shall set forth the
lifetime income stream equivalent of
the total benefits accrued with respect
to the participant or beneficiary.
``(II) Lifetime income stream
equivalent of the total benefits
accrued.--For purposes of this
subparagraph, the term `lifetime income
stream equivalent of the total benefits
accrued' means the amount of monthly
payments the participant or beneficiary
would receive if the total accrued
benefits of such participant or
beneficiary were used to provide
lifetime income streams described in
subclause (III), based on assumptions
specified in rules prescribed by the
Secretary.
``(III) Lifetime income streams.--
The lifetime income streams described
in this subclause are a qualified joint
and survivor annuity (as defined in
section 205(d)), based on assumptions
specified in rules prescribed by the
Secretary, including the assumption
that the participant or beneficiary has
a spouse of equal age, and a single
life annuity. Such lifetime income
streams may have a term certain or
other features to the extent permitted
under rules prescribed by the
Secretary.
``(ii) Model disclosure.--Not later than 1
year after the date of the enactment of the
Setting Every Community Up for Retirement
Enhancement Act of 2019, the Secretary shall
issue a model lifetime income disclosure,
written in a manner so as to be understood by
the average plan participant, which--
``(I) explains that the lifetime
income stream equivalent is only
provided as an illustration;
``(II) explains that the actual
payments under the lifetime income
stream described in clause (i)(III)
which may be purchased with the total
benefits accrued will depend on
numerous factors and may vary
substantially from the lifetime income
stream equivalent in the disclosures;
``(III) explains the assumptions
upon which the lifetime income stream
equivalent was determined; and
``(IV) provides such other similar
explanations as the Secretary considers
appropriate.
``(iii) Assumptions and rules.--Not later
than 1 year after the date of the enactment of
the Setting Every Community Up for Retirement
Enhancement Act of 2019, the Secretary shall--
``(I) prescribe assumptions which
administrators of individual account
plans may use in converting total
accrued benefits into lifetime income
stream equivalents for purposes of this
subparagraph; and
``(II) issue interim final rules
under clause (i).
In prescribing assumptions under subclause (I),
the Secretary may prescribe a single set of
specific assumptions (in which case the
Secretary may issue tables or factors which
facilitate such conversions), or ranges of
permissible assumptions. To the extent that an
accrued benefit is or may be invested in a
lifetime income stream described in clause
(i)(III), the assumptions prescribed under
subclause (I) shall, to the extent appropriate,
permit administrators of individual account
plans to use the amounts payable under such
lifetime income stream as a lifetime income
stream equivalent.
``(iv) Limitation on liability.--No plan
fiduciary, plan sponsor, or other person shall
have any liability under this title solely by
reason of the provision of lifetime income
stream equivalents which are derived in
accordance with the assumptions and rules
described in clause (iii) and which include the
explanations contained in the model lifetime
income disclosure described in clause (ii).
This clause shall apply without regard to
whether the provision of such lifetime income
stream equivalent is required by subparagraph
(B)(iii).
``(v) Effective date.--The requirement in
subparagraph (B)(iii) shall apply to pension
benefit statements furnished more than 12
months after the latest of the issuance by the
Secretary of--
``(I) interim final rules under
clause (i);
``(II) the model disclosure under
clause (ii); or
``(III) the assumptions under
clause (iii).''.
SEC. 204. FIDUCIARY SAFE HARBOR FOR SELECTION OF LIFETIME INCOME
PROVIDER.
Section 404 of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1104) is amended by adding at the end the following:
``(e) Safe Harbor for Annuity Selection.--
``(1) In general.--With respect to the selection of an
insurer for a guaranteed retirement income contract, the
requirements of subsection (a)(1)(B) will be deemed to be
satisfied if a fiduciary--
``(A) engages in an objective, thorough, and
analytical search for the purpose of identifying
insurers from which to purchase such contracts;
``(B) with respect to each insurer identified under
subparagraph (A)--
``(i) considers the financial capability of
such insurer to satisfy its obligations under
the guaranteed retirement income contract; and
``(ii) considers the cost (including fees
and commissions) of the guaranteed retirement
income contract offered by the insurer in
relation to the benefits and product features
of the contract and administrative services to
be provided under such contract; and
``(C) on the basis of such consideration, concludes
that--
``(i) at the time of the selection, the
insurer is financially capable of satisfying
its obligations under the guaranteed retirement
income contract; and
``(ii) the relative cost of the selected
guaranteed retirement income contract as
described in subparagraph (B)(ii) is
reasonable.
``(2) Financial capability of the insurer.--A fiduciary
will be deemed to satisfy the requirements of paragraphs
(1)(B)(i) and (1)(C)(i) if--
``(A) the fiduciary obtains written representations
from the insurer that--
``(i) the insurer is licensed to offer
guaranteed retirement income contracts;
``(ii) the insurer, at the time of
selection and for each of the immediately
preceding 7 plan years--
``(I) operates under a certificate
of authority from the insurance
commissioner of its domiciliary State
which has not been revoked or
suspended;
``(II) has filed audited financial
statements in accordance with the laws
of its domiciliary State under
applicable statutory accounting
principles;
``(III) maintains (and has
maintained) reserves which satisfies
all the statutory requirements of all
States where the insurer does business;
and
``(IV) is not operating under an
order of supervision, rehabilitation,
or liquidation;
``(iii) the insurer undergoes, at least
every 5 years, a financial examination (within
the meaning of the law of its domiciliary
State) by the insurance commissioner of the
domiciliary State (or representative, designee,
or other party approved by such commissioner);
and
``(iv) the insurer will notify the
fiduciary of any change in circumstances
occurring after the provision of the
representations in clauses (i), (ii), and (iii)
which would preclude the insurer from making
such representations at the time of issuance of
the guaranteed retirement income contract; and
``(B) after receiving such representations and as
of the time of selection, the fiduciary has not
received any notice described in subparagraph (A)(iv)
and is in possession of no other information which
would cause the fiduciary to question the
representations provided.
``(3) No requirement to select lowest cost.--Nothing in
this subsection shall be construed to require a fiduciary to
select the lowest cost contract. A fiduciary may consider the
value of a contract, including features and benefits of the
contract and attributes of the insurer (including, without
limitation, the insurer's financial strength) in conjunction
with the cost of the contract.
``(4) Time of selection.--
``(A) In general.--For purposes of this subsection,
the time of selection is--
``(i) the time that the insurer and the
contract are selected for distribution of
benefits to a specific participant or
beneficiary; or
``(ii) if the fiduciary periodically
reviews the continuing appropriateness of the
conclusion described in paragraph (1)(C) with
respect to a selected insurer, taking into
account the considerations described in such
paragraph, the time that the insurer and the
contract are selected to provide benefits at
future dates to participants or beneficiaries
under the plan.
Nothing in the preceding sentence shall be construed to
require the fiduciary to review the appropriateness of
a selection after the purchase of a contract for a
participant or beneficiary.
``(B) Periodic review.--A fiduciary will be deemed
to have conducted the periodic review described in
subparagraph (A)(ii) if the fiduciary obtains the
written representations described in clauses (i), (ii),
and (iii) of paragraph (2)(A) from the insurer on an
annual basis, unless the fiduciary receives any notice
described in paragraph (2)(A)(iv) or otherwise becomes
aware of facts that would cause the fiduciary to
question such representations.
``(5) Limited liability.--A fiduciary which satisfies the
requirements of this subsection shall not be liable following
the distribution of any benefit, or the investment by or on
behalf of a participant or beneficiary pursuant to the selected
guaranteed retirement income contract, for any losses that may
result to the participant or beneficiary due to an insurer's
inability to satisfy its financial obligations under the terms
of such contract.
``(6) Definitions.--For purposes of this subsection--
``(A) Insurer.--The term `insurer' means an
insurance company, insurance service, or insurance
organization, including affiliates of such companies.
``(B) Guaranteed retirement income contract.--The
term `guaranteed retirement income contract' means an
annuity contract for a fixed term or a contract (or
provision or feature thereof) which provides guaranteed
benefits annually (or more frequently) for at least the
remainder of the life of the participant or the joint
lives of the participant and the participant's
designated beneficiary as part of an individual account
plan.''.
SEC. 205. MODIFICATION OF NONDISCRIMINATION RULES TO PROTECT OLDER,
LONGER SERVICE PARTICIPANTS.
(a) In General.--Section 401 of the Internal Revenue Code of 1986
is amended--
(1) by redesignating subsection (o) as subsection (p); and
(2) by inserting after subsection (n) the following new
subsection:
``(o) Special Rules for Applying Nondiscrimination Rules To Protect
Older, Longer Service and Grandfathered Participants.--
``(1) Testing of defined benefit plans with closed classes
of participants.--
``(A) Benefits, rights, or features provided to
closed classes.--A defined benefit plan which provides
benefits, rights, or features to a closed class of
participants shall not fail to satisfy the requirements
of subsection (a)(4) by reason of the composition of
such closed class or the benefits, rights, or features
provided to such closed class, if--
``(i) for the plan year as of which the
class closes and the 2 succeeding plan years,
such benefits, rights, and features satisfy the
requirements of subsection (a)(4) (without
regard to this subparagraph but taking into
account the rules of subparagraph (I)),
``(ii) after the date as of which the class
was closed, any plan amendment which modifies
the closed class or the benefits, rights, and
features provided to such closed class does not
discriminate significantly in favor of highly
compensated employees, and
``(iii) the class was closed before April
5, 2017, or the plan is described in
subparagraph (C).
``(B) Aggregate testing with defined contribution
plans permitted on a benefits basis.--
``(i) In general.--For purposes of
determining compliance with subsection (a)(4)
and section 410(b), a defined benefit plan
described in clause (iii) may be aggregated and
tested on a benefits basis with 1 or more
defined contribution plans, including with the
portion of 1 or more defined contribution plans
which--
``(I) provides matching
contributions (as defined in subsection
(m)(4)(A)),
``(II) provides annuity contracts
described in section 403(b) which are
purchased with matching contributions
or nonelective contributions, or
``(III) consists of an employee
stock ownership plan (within the
meaning of section 4975(e)(7)) or a tax
credit employee stock ownership plan
(within the meaning of section 409(a)).
``(ii) Special rules for matching
contributions.--For purposes of clause (i), if
a defined benefit plan is aggregated with a
portion of a defined contribution plan
providing matching contributions--
``(I) such defined benefit plan
must also be aggregated with any
portion of such defined contribution
plan which provides elective deferrals
described in subparagraph (A) or (C) of
section 402(g)(3), and
``(II) such matching contributions
shall be treated in the same manner as
nonelective contributions, including
for purposes of applying the rules of
subsection (l).
``(iii) Plans described.--A defined benefit
plan is described in this clause if--
``(I) the plan provides benefits to
a closed class of participants,
``(II) for the plan year as of
which the class closes and the 2
succeeding plan years, the plan
satisfies the requirements of section
410(b) and subsection (a)(4) (without
regard to this subparagraph but taking
into account the rules of subparagraph
(I)),
``(III) after the date as of which
the class was closed, any plan
amendment which modifies the closed
class or the benefits provided to such
closed class does not discriminate
significantly in favor of highly
compensated employees, and
``(IV) the class was closed before
April 5, 2017, or the plan is described
in subparagraph (C).
``(C) Plans described.--A plan is described in this
subparagraph if, taking into account any predecessor
plan--
``(i) such plan has been in effect for at
least 5 years as of the date the class is
closed, and
``(ii) during the 5-year period preceding
the date the class is closed, there has not
been a substantial increase in the coverage or
value of the benefits, rights, or features
described in subparagraph (A) or in the
coverage or benefits under the plan described
in subparagraph (B)(iii) (whichever is
applicable).
``(D) Determination of substantial increase for
benefits, rights, and features.--In applying
subparagraph (C)(ii) for purposes of subparagraph
(A)(iii), a plan shall be treated as having had a
substantial increase in coverage or value of the
benefits, rights, or features described in subparagraph
(A) during the applicable 5-year period only if, during
such period--
``(i) the number of participants covered by
such benefits, rights, or features on the date
such period ends is more than 50 percent
greater than the number of such participants on
the first day of the plan year in which such
period began, or
``(ii) such benefits, rights, and features
have been modified by 1 or more plan amendments
in such a way that, as of the date the class is
closed, the value of such benefits, rights, and
features to the closed class as a whole is
substantially greater than the value as of the
first day of such 5-year period, solely as a
result of such amendments.
``(E) Determination of substantial increase for
aggregate testing on benefits basis.--In applying
subparagraph (C)(ii) for purposes of subparagraph
(B)(iii)(IV), a plan shall be treated as having had a
substantial increase in coverage or benefits during the
applicable 5-year period only if, during such period--
``(i) the number of participants
benefitting under the plan on the date such
period ends is more than 50 percent greater
than the number of such participants on the
first day of the plan year in which such period
began, or
``(ii) the average benefit provided to such
participants on the date such period ends is
more than 50 percent greater than the average
benefit provided on the first day of the plan
year in which such period began.
``(F) Certain employees disregarded.--For purposes
of subparagraphs (D) and (E), any increase in coverage
or value or in coverage or benefits, whichever is
applicable, which is attributable to such coverage and
value or coverage and benefits provided to employees--
``(i) who became participants as a result
of a merger, acquisition, or similar event
which occurred during the 7-year period
preceding the date the class is closed, or
``(ii) who became participants by reason of
a merger of the plan with another plan which
had been in effect for at least 5 years as of
the date of the merger,
shall be disregarded, except that clause (ii) shall
apply for purposes of subparagraph (D) only if, under
the merger, the benefits, rights, or features under 1
plan are conformed to the benefits, rights, or features
of the other plan prospectively.
``(G) Rules relating to average benefit.--For
purposes of subparagraph (E)--
``(i) the average benefit provided to
participants under the plan will be treated as
having remained the same between the 2 dates
described in subparagraph (E)(ii) if the
benefit formula applicable to such participants
has not changed between such dates, and
``(ii) if the benefit formula applicable to
1 or more participants under the plan has
changed between such 2 dates, then the average
benefit under the plan shall be considered to
have increased by more than 50 percent only
if--
``(I) the total amount determined
under section 430(b)(1)(A)(i) for all
participants benefitting under the plan
for the plan year in which the 5-year
period described in subparagraph (E)
ends, exceeds
``(II) the total amount determined
under section 430(b)(1)(A)(i) for all
such participants for such plan year,
by using the benefit formula in effect
for each such participant for the first
plan year in such 5-year period,
by more than 50 percent. In the case of a CSEC
plan (as defined in section 414(y)), the normal
cost of the plan (as determined under section
433(j)(1)(B)) shall be used in lieu of the
amount determined under section
430(b)(1)(A)(i).
``(H) Treatment as single plan.--For purposes of
subparagraphs (E) and (G), a plan described in section
413(c) shall be treated as a single plan rather than as
separate plans maintained by each employer in the plan.
``(I) Special rules.--For purposes of subparagraphs
(A)(i) and (B)(iii)(II), the following rules shall
apply:
``(i) In applying section 410(b)(6)(C), the
closing of the class of participants shall not
be treated as a significant change in coverage
under section 410(b)(6)(C)(i)(II).
``(ii) Two or more plans shall not fail to
be eligible to be aggregated and treated as a
single plan solely by reason of having
different plan years.
``(iii) Changes in the employee population
shall be disregarded to the extent attributable
to individuals who become employees or cease to
be employees, after the date the class is
closed, by reason of a merger, acquisition,
divestiture, or similar event.
``(iv) Aggregation and all other testing
methodologies otherwise applicable under
subsection (a)(4) and section 410(b) may be
taken into account.
The rule of clause (ii) shall also apply for purposes
of determining whether plans to which subparagraph
(B)(i) applies may be aggregated and treated as 1 plan
for purposes of determining whether such plans meet the
requirements of subsection (a)(4) and section 410(b).
``(J) Spun-off plans.--For purposes of this
paragraph, if a portion of a defined benefit plan
described in subparagraph (A) or (B)(iii) is spun off
to another employer and the spun-off plan continues to
satisfy the requirements of--
``(i) subparagraph (A)(i) or (B)(iii)(II),
whichever is applicable, if the original plan
was still within the 3-year period described in
such subparagraph at the time of the spin off,
and
``(ii) subparagraph (A)(ii) or
(B)(iii)(III), whichever is applicable,
the treatment under subparagraph (A) or (B) of the
spun-off plan shall continue with respect to such other
employer.
``(2) Testing of defined contribution plans.--
``(A) Testing on a benefits basis.--A defined
contribution plan shall be permitted to be tested on a
benefits basis if--
``(i) such defined contribution plan
provides make-whole contributions to a closed
class of participants whose accruals under a
defined benefit plan have been reduced or
eliminated,
``(ii) for the plan year of the defined
contribution plan as of which the class
eligible to receive such make-whole
contributions closes and the 2 succeeding plan
years, such closed class of participants
satisfies the requirements of section
410(b)(2)(A)(i) (determined by applying the
rules of paragraph (1)(I)),
``(iii) after the date as of which the
class was closed, any plan amendment to the
defined contribution plan which modifies the
closed class or the allocations, benefits,
rights, and features provided to such closed
class does not discriminate significantly in
favor of highly compensated employees, and
``(iv) the class was closed before April 5,
2017, or the defined benefit plan under clause
(i) is described in paragraph (1)(C) (as
applied for purposes of paragraph
(1)(B)(iii)(IV)).
``(B) Aggregation with plans including matching
contributions.--
``(i) In general.--With respect to 1 or
more defined contribution plans described in
subparagraph (A), for purposes of determining
compliance with subsection (a)(4) and section
410(b), the portion of such plans which
provides make-whole contributions or other
nonelective contributions may be aggregated and
tested on a benefits basis with the portion of
1 or more other defined contribution plans
which--
``(I) provides matching
contributions (as defined in subsection
(m)(4)(A)),
``(II) provides annuity contracts
described in section 403(b) which are
purchased with matching contributions
or nonelective contributions, or
``(III) consists of an employee
stock ownership plan (within the
meaning of section 4975(e)(7)) or a tax
credit employee stock ownership plan
(within the meaning of section 409(a)).
``(ii) Special rules for matching
contributions.--Rules similar to the rules of
paragraph (1)(B)(ii) shall apply for purposes
of clause (i).
``(C) Special rules for testing defined
contribution plan features providing matching
contributions to certain older, longer service
participants.--In the case of a defined contribution
plan which provides benefits, rights, or features to a
closed class of participants whose accruals under a
defined benefit plan have been reduced or eliminated,
the plan shall not fail to satisfy the requirements of
subsection (a)(4) solely by reason of the composition
of the closed class or the benefits, rights, or
features provided to such closed class if the defined
contribution plan and defined benefit plan otherwise
meet the requirements of subparagraph (A) but for the
fact that the make-whole contributions under the
defined contribution plan are made in whole or in part
through matching contributions.
``(D) Spun-off plans.--For purposes of this
paragraph, if a portion of a defined contribution plan
described in subparagraph (A) or (C) is spun off to
another employer, the treatment under subparagraph (A)
or (C) of the spun-off plan shall continue with respect
to the other employer if such plan continues to comply
with the requirements of clauses (ii) (if the original
plan was still within the 3-year period described in
such clause at the time of the spin off) and (iii) of
subparagraph (A), as determined for purposes of
subparagraph (A) or (C), whichever is applicable.
``(3) Definitions and special rule.--For purposes of this
subsection--
``(A) Make-whole contributions.--Except as
otherwise provided in paragraph (2)(C), the term `make-
whole contributions' means nonelective allocations for
each employee in the class which are reasonably
calculated, in a consistent manner, to replace some or
all of the retirement benefits which the employee would
have received under the defined benefit plan and any
other plan or qualified cash or deferred arrangement
under subsection (k)(2) if no change had been made to
such defined benefit plan and such other plan or
arrangement. For purposes of the preceding sentence,
consistency shall not be required with respect to
employees who were subject to different benefit
formulas under the defined benefit plan.
``(B) References to closed class of participants.--
References to a closed class of participants and
similar references to a closed class shall include
arrangements under which 1 or more classes of
participants are closed, except that 1 or more classes
of participants closed on different dates shall not be
aggregated for purposes of determining the date any
such class was closed.
``(C) Highly compensated employee.--The term
`highly compensated employee' has the meaning given
such term in section 414(q).''.
(b) Participation Requirements.--Paragraph (26) of section 401(a)
of the Internal Revenue Code of 1986 is amended by adding at the end
the following new subparagraph:
``(I) Protected participants.--
``(i) In general.--A plan shall be deemed
to satisfy the requirements of subparagraph (A)
if--
``(I) the plan is amended--
``(aa) to cease all benefit
accruals, or
``(bb) to provide future
benefit accruals only to a
closed class of participants,
``(II) the plan satisfies
subparagraph (A) (without regard to
this subparagraph) as of the effective
date of the amendment, and
``(III) the amendment was adopted
before April 5, 2017, or the plan is
described in clause (ii).
``(ii) Plans described.--A plan is
described in this clause if the plan would be
described in subsection (o)(1)(C), as applied
for purposes of subsection (o)(1)(B)(iii)(IV)
and by treating the effective date of the
amendment as the date the class was closed for
purposes of subsection (o)(1)(C).
``(iii) Special rules.--For purposes of
clause (i)(II), in applying section
410(b)(6)(C), the amendments described in
clause (i) shall not be treated as a
significant change in coverage under section
410(b)(6)(C)(i)(II).
``(iv) Spun-off plans.--For purposes of
this subparagraph, if a portion of a plan
described in clause (i) is spun off to another
employer, the treatment under clause (i) of the
spun-off plan shall continue with respect to
the other employer.''.
(c) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall take effect on the date
of the enactment of this Act, without regard to whether any
plan modifications referred to in such amendments are adopted
or effective before, on, or after such date of enactment.
(2) Special rules.--
(A) Election of earlier application.--At the
election of the plan sponsor, the amendments made by
this section shall apply to plan years beginning after
December 31, 2013.
(B) Closed classes of participants.--For purposes
of paragraphs (1)(A)(iii), (1)(B)(iii)(IV), and
(2)(A)(iv) of section 401(o) of the Internal Revenue
Code of 1986 (as added by this section), a closed class
of participants shall be treated as being closed before
April 5, 2017, if the plan sponsor's intention to
create such closed class is reflected in formal written
documents and communicated to participants before such
date.
(C) Certain post-enactment plan amendments.--A plan
shall not be treated as failing to be eligible for the
application of section 401(o)(1)(A), 401(o)(1)(B)(iii),
or 401(a)(26) of such Code (as added by this section)
to such plan solely because in the case of--
(i) such section 401(o)(1)(A), the plan was
amended before the date of the enactment of
this Act to eliminate 1 or more benefits,
rights, or features, and is further amended
after such date of enactment to provide such
previously eliminated benefits, rights, or
features to a closed class of participants, or
(ii) such section 401(o)(1)(B)(iii) or
section 401(a)(26), the plan was amended before
the date of the enactment of this Act to cease
all benefit accruals, and is further amended
after such date of enactment to provide benefit
accruals to a closed class of participants.
Any such section shall only apply if the plan otherwise
meets the requirements of such section and in applying
such section, the date the class of participants is
closed shall be the effective date of the later
amendment.
TITLE III--OTHER BENEFITS
SEC. 301. BENEFITS PROVIDED TO VOLUNTEER FIREFIGHTERS AND EMERGENCY
MEDICAL RESPONDERS.
(a) Increase in Dollar Limitation on Qualified Payments.--
Subparagraph (B) of section 139B(c)(2) of the Internal Revenue Code of
1986 is amended by striking ``$30'' and inserting ``$50''.
(b) Extension.--Section 139B(d) of the Internal Revenue Code of
1986 is amended by striking ``beginning after December 31, 2010.'' and
inserting ``beginning--
``(1) after December 31, 2010, and before January 1, 2020,
or
``(2) after December 31, 2020.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2019.
SEC. 302. EXPANSION OF SECTION 529 PLANS.
(a) Distributions for Certain Expenses Associated With Registered
Apprenticeship Programs.--Section 529(c) of the Internal Revenue Code
of 1986 is amended by adding at the end the following new paragraph:
``(8) Treatment of certain expenses associated with
registered apprenticeship programs.--Any reference in this
subsection to the term `qualified higher education expense'
shall include a reference to expenses for fees, books,
supplies, and equipment required for the participation of a
designated beneficiary in an apprenticeship program registered
and certified with the Secretary of Labor under section 1 of
the National Apprenticeship Act (29 U.S.C. 50).''.
(b) Distributions for Certain Homeschooling Expenses.--Section
529(c)(7) of such Code is amended by striking ``include a reference
to'' and all that follows and inserting: ``include a reference to--
``(A) expenses for tuition in connection with
enrollment or attendance of a designated beneficiary at
an elementary or secondary public, private, or
religious school, and
``(B) expenses, with respect to a designated
beneficiary, for--
``(i) curriculum and curricular materials,
``(ii) books or other instructional
materials,
``(iii) online educational materials,
``(iv) tuition for tutoring or educational
classes outside of the home (but only if the
tutor or class instructor is not related
(within the meaning of section 152(d)(2)) to
the student),
``(v) dual enrollment in an institution of
higher education, and
``(vi) educational therapies for students
with disabilities,
in connection with a homeschool (whether treated as a
homeschool or a private school for purposes of
applicable State law).''.
(c) Distributions for Qualified Education Loan Repayments.--
(1) In general.--Section 529(c) of such Code, as amended by
subsection (a), is amended by adding at the end the following
new paragraph:
``(9) Treatment of qualified education loan repayments.--
``(A) In general.--Any reference in this subsection
to the term `qualified higher education expense' shall
include a reference to amounts paid as principal or
interest on any qualified education loan (as defined in
section 221(d)) of the designated beneficiary or a
sibling of the designated beneficiary.
``(B) Limitation.--The amount of distributions
treated as a qualified higher education expense under
this paragraph with respect to the loans of any
individual shall not exceed $10,000 (reduced by the
amount of distributions so treated for all prior
taxable years).
``(C) Special rules for siblings of the designated
beneficiary.--
``(i) Separate accounting.--For purposes of
subparagraph (B) and subsection (d), amounts
treated as a qualified higher education expense
with respect to the loans of a sibling of the
designated beneficiary shall be taken into
account with respect to such sibling and not
with respect to such designated beneficiary.
``(ii) Sibling defined.--For purposes of
this paragraph, the term `sibling' means an
individual who bears a relationship to the
designated beneficiary which is described in
section 152(d)(2)(B).''.
(2) Coordination with deduction for student loan
interest.--Section 221(e)(1) of such Code is amended by adding
at the end the following: ``The deduction otherwise allowable
under subsection (a) (prior to the application of subsection
(b)) to the taxpayer for any taxable year shall be reduced (but
not below zero) by so much of the distributions treated as a
qualified higher education expense under section 529(c)(9) with
respect to loans of the taxpayer as would be includible in
gross income under section 529(c)(3)(A) for such taxable year
but for such treatment.''.
(d) Distributions for Certain Elementary and Secondary School
Expenses in Addition to Tuition.--Section 529(c)(7)(A) of such Code, as
amended by subsection (b), is amended to read as follows:
``(A) expenses described in section 530(b)(3)(A)(i)
in connection with enrollment or attendance of a
designated beneficiary at an elementary or secondary
public, private, or religious school, and''.
(e) Effective Dates.--The amendments made by this section shall
apply to distributions made after December 31, 2018.
TITLE IV--REVENUE PROVISIONS
SEC. 401. MODIFICATIONS OF REQUIRED DISTRIBUTION RULES FOR DESIGNATED
BENEFICIARIES.
(a) Modification of Rules Where Employee Dies Before Entire
Distribution.--
(1) In general.--Section 401(a)(9) of the Internal Revenue
Code of 1986 is amended by adding at the end the following new
subparagraph:
``(H) Special rules for certain defined
contribution plans.--In the case of a defined
contribution plan, if an employee dies before the
distribution of the employee's entire interest--
``(i) In general.--Except in the case of a
beneficiary who is not a designated
beneficiary, subparagraph (B)(ii)--
``(I) shall be applied by
substituting `10 years' for `5 years',
and
``(II) shall apply whether or not
distributions of the employee's
interests have begun in accordance with
subparagraph (A).
``(ii) Exception only for eligible
designated beneficiaries.--Subparagraph
(B)(iii) shall apply only in the case of an
eligible designated beneficiary.
``(iii) Rules upon death of eligible
designated beneficiary.--If an eligible
designated beneficiary dies before the portion
of the employee's interest to which this
subparagraph applies is entirely distributed,
the exception under clause (iii) shall not
apply to any beneficiary of such eligible
designated beneficiary and the remainder of
such portion shall be distributed within 10
years after the death of such eligible
designated beneficiary.
``(iv) Application to eligible retirement
plans.--For purposes of applying the provisions
of this subparagraph in determining the amounts
required to be distributed pursuant to this
paragraph, all eligible retirement plans (as
defined in section 402(c)(8)(B)) other than a
defined benefit plan shall be treated as a
defined contribution plan.''.
(2) Definition of eligible designated beneficiary.--Section
401(a)(9)(E) of such Code is amended to read as follows:
``(E) Definitions and rules relating to designated
beneficiary.--For purposes of this paragraph--
``(i) Designated beneficiary.--The term
`designated beneficiary' means any individual
designated as a beneficiary by the employee.
``(ii) Eligible designated beneficiary.--
The term `eligible designated beneficiary'
means, with respect to any employee, any
designated beneficiary who is--
``(I) the surviving spouse of the
employee,
``(II) subject to clause (iii), a
child of the employee who has not
reached majority (within the meaning of
subparagraph (F)),
``(III) disabled (within the
meaning of section 72(m)(7)),
``(IV) a chronically ill individual
(within the meaning of section
7702B(c)(2), except that the
requirements of subparagraph (A)(i)
thereof shall only be treated as met if
there is a certification that, as of
such date, the period of inability
described in such subparagraph with
respect to the individual is an
indefinite one which is reasonably
expected to be lengthy in nature), or
``(V) an individual not described
in any of the preceding subclauses who
is not more than 10 years younger than
the employee.
``(iii) Special rule for children.--Subject
to subparagraph (F), an individual described in
clause (ii)(II) shall cease to be an eligible
designated beneficiary as of the date the
individual reaches majority and any remainder
of the portion of the individual's interest to
which subparagraph (H)(ii) applies shall be
distributed within 10 years after such date.
``(iv) Time for determination of eligible
designated beneficiary.--The determination of
whether a designated beneficiary is an eligible
designated beneficiary shall be made as of the
date of death of the employee.''.
(3) Effective dates.--
(A) In general.--Except as provided in this
paragraph and paragraphs (4) and (5), the amendments
made by this subsection shall apply to distributions
with respect to employees who die after December 31,
2019.
(B) Collective bargaining exception.--In the case
of a plan maintained pursuant to 1 or more collective
bargaining agreements between employee representatives
and 1 or more employers ratified before the date of
enactment of this Act, the amendments made by this
subsection shall apply to distributions with respect to
employees who die in calendar years beginning after the
earlier of--
(i) the later of--
(I) the date on which the last of
such collective bargaining agreements
terminates (determined without regard
to any extension thereof agreed to on
or after the date of the enactment of
this Act), or
(II) December 31, 2019, or
(ii) December 31, 2021.
For purposes of clause (i)(I), any plan amendment made
pursuant to a collective bargaining agreement relating
to the plan which amends the plan solely to conform to
any requirement added by this section shall not be
treated as a termination of such collective bargaining
agreement.
(C) Governmental plans.--In the case of a
governmental plan (as defined in section 414(d) of the
Internal Revenue Code of 1986), subparagraph (A) shall
be applied by substituting ``December 31, 2021'' for
``December 31, 2019''.
(4) Exception for certain existing annuity contracts.--
(A) In general.--The amendments made by this
subsection shall not apply to a qualified annuity which
is a binding annuity contract in effect on the date of
enactment of this Act and at all times thereafter.
(B) Qualified annuity.--For purposes of this
paragraph, the term ``qualified annuity'' means, with
respect to an employee, an annuity--
(i) which is a commercial annuity (as
defined in section 3405(e)(6) of the Internal
Revenue Code of 1986);
(ii) under which the annuity payments are
made over the life of the employee or over the
joint lives of such employee and a designated
beneficiary (or over a period not extending
beyond the life expectancy of such employee or
the joint life expectancy of such employee and
a designated beneficiary) in accordance with
the regulations described in section
401(a)(9)(A)(ii) of such Code (as in effect
before such amendments) and which meets the
other requirements of section 401(a)(9) of such
Code (as so in effect) with respect to such
payments; and
(iii) with respect to which--
(I) annuity payments to the
employee have begun before the date of
enactment of this Act, and the employee
has made an irrevocable election before
such date as to the method and amount
of the annuity payments to the employee
or any designated beneficiaries; or
(II) if subclause (I) does not
apply, the employee has made an
irrevocable election before the date of
enactment of this Act as to the method
and amount of the annuity payments to
the employee or any designated
beneficiaries.
(5) Exception for certain beneficiaries.--
(A) In general.--If an employee dies before the
effective date, then, in applying the amendments made
by this subsection to such employee's designated
beneficiary who dies after such date--
(i) such amendments shall apply to any
beneficiary of such designated beneficiary; and
(ii) the designated beneficiary shall be
treated as an eligible designated beneficiary
for purposes of applying section
401(a)(9)(H)(ii) of the Internal Revenue Code
of 1986 (as in effect after such amendments).
(B) Effective date.--For purposes of this
paragraph, the term ``effective date'' means the first
day of the first calendar year to which the amendments
made by this subsection apply to a plan with respect to
employees dying on or after such date.
(b) Provisions Relating to Plan Amendments.--
(1) In general.--If this subsection applies to any plan
amendment--
(A) such plan shall be treated as being operated in
accordance with the terms of the plan during the period
described in paragraph (2)(B)(i); and
(B) except as provided by the Secretary of the
Treasury, such plan shall not fail to meet the
requirements of section 411(d)(6) of the Internal
Revenue Code of 1986 and section 204(g) of the Employee
Retirement Income Security Act of 1974 by reason of
such amendment.
(2) Amendments to which subsection applies.--
(A) In general.--This subsection shall apply to any
amendment to any plan or which is made--
(i) pursuant to any amendment made by this
section or pursuant to any regulation issued by
the Secretary of the Treasury under this
section or such amendments; and
(ii) on or before the last day of the first
plan year beginning after December 31, 2021, or
such later date as the Secretary of the
Treasury may prescribe.
In the case of a governmental or collectively bargained
plan to which subparagraph (B) or (C) of subsection
(a)(4) applies, clause (ii) shall be applied by
substituting the date which is 2 years after the date
otherwise applied under such clause.
(B) Conditions.--This subsection shall not apply to
any amendment unless--
(i) during the period--
(I) beginning on the date the
legislative or regulatory amendment
described in paragraph (1)(A) takes
effect (or in the case of a plan
amendment not required by such
legislative or regulatory amendment,
the effective date specified by the
plan); and
(II) ending on the date described
in subparagraph (A)(ii) (or, if
earlier, the date the plan amendment is
adopted),
the plan is operated as if such plan amendment
were in effect; and
(ii) such plan amendment applies
retroactively for such period.
SEC. 402. INCREASE IN PENALTY FOR FAILURE TO FILE.
(a) In General.--The second sentence of subsection (a) of section
6651 of the Internal Revenue Code of 1986 is amended by striking
``$205'' and inserting ``$400''.
(b) Inflation Adjustment.--Section 6651(j)(1) of such Code is
amended by striking ``$205'' and inserting ``$400''.
(c) Effective Date.--The amendment made by this section shall apply
to returns the due date for which (including extensions) is after
December 31, 2019.
SEC. 403. INCREASED PENALTIES FOR FAILURE TO FILE RETIREMENT PLAN
RETURNS.
(a) In General.--Subsection (e) of section 6652 of the Internal
Revenue Code of 1986 is amended--
(1) by striking ``$25'' and inserting ``$105''; and
(2) by striking ``$15,000'' and inserting ``$50,000''.
(b) Annual Registration Statement and Notification of Changes.--
Subsection (d) of section 6652 of the Internal Revenue Code of 1986 is
amended--
(1) by striking ``$1'' both places it appears in paragraphs
(1) and (2) and inserting ``$2'';
(2) by striking ``$5,000'' in paragraph (1) and inserting
``$10,000''; and
(3) by striking ``$1,000'' in paragraph (2) and inserting
``$5,000''.
(c) Failure To Provide Notice.--Subsection (h) of section 6652 of
the Internal Revenue Code of 1986 is amended--
(1) by striking ``$10'' and inserting ``$100''; and
(2) by striking ``$5,000'' and inserting ``$50,000''.
(d) Effective Date.--The amendments made by this subsection shall
apply to returns, statements, and notifications required to be filed,
and notices required to be provided, after December 31, 2019.
SEC. 404. INCREASE INFORMATION SHARING TO ADMINISTER EXCISE TAXES.
(a) In General.--Section 6103(o) of the Internal Revenue Code of
1986 is amended by adding at the end the following new paragraph:
``(3) Taxes imposed by section 4481.--Returns and return
information with respect to taxes imposed by section 4481 shall
be open to inspection by or disclosure to officers and
employees of United States Customs and Border Protection of the
Department of Homeland Security whose official duties require
such inspection or disclosure for purposes of administering
such section.''.
(b) Conforming Amendments.--Paragraph (4) of section 6103(p) of the
Internal Revenue Code of 1986 is amended by striking ``or (o)(1)(A)''
each place it appears and inserting ``, (o)(1)(A), or (o)(3)''.
<all>
Committee on Education and Labor discharged.
Committee on Education and Labor discharged.
Placed on the Union Calendar, Calendar No. 42.
Rules Committee Resolution H. Res. 389 Reported to House. Rule provides for consideration of H.R. 1500 and H.R. 1994. The resolution provides for one hour of debate on H.R. 1500, under a structured rule, and provides for one hour of debate on H.R. 1994, under a closed rule. The resolution provides for proceedings during the period from May 24, 2019, through May 31, 2019, and provides for motions to suspend the rules on the legislative day of May 23, 2019.
Rule H. Res. 389 passed House.
Considered under the provisions of rule H. Res. 389. (consideration: CR H4124-4146)
Rule provides for consideration of H.R. 1500 and H.R. 1994. The resolution provides for one hour of debate on H.R. 1500, under a structured rule, and provides for one hour of debate on H.R. 1994, under a closed rule. The resolution provides for proceedings during the period from May 24, 2019, through May 31, 2019, and provides for motions to suspend the rules on the legislative day of May 23, 2019.
DEBATE - The House proceeded with one hour of debate on H.R. 1994.
The previous question was ordered pursuant to the rule.
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line
POSTPONED PROCEEDINGS - Pursuant to clause 1(c) of Rule 19, the Chair postponed further proceedings on H.R. 1994.
Considered as unfinished business. (consideration: CR H4146-4149)
Mr. McHenry moved to recommit with instructions to the Committee on Ways and Means. (text: CR H4147)
DEBATE - The House proceeded with 10 minutes of debate on the McHenry motion to recommit with instructions. The instructions contained in the motion seek to require the bill to be reported back to the House with an amendment to add a new section at the end of title IV entitled "Reports by Taxpayers Engaged in Boycotts Etc. Affecting Israel"
The previous question on the motion to recommit with instructions was ordered without objection.
On motion to recommit with instructions Failed by recorded vote: 200 - 222 (Roll no. 230).
Roll Call #230 (House)Passed/agreed to in House: On passage Passed by the Yeas and Nays: 417 - 3 (Roll no. 231).(text: CR H4124-4135)
Roll Call #231 (House)On passage Passed by the Yeas and Nays: 417 - 3 (Roll no. 231). (text: CR H4124-4135)
Roll Call #231 (House)Motion to reconsider laid on the table Agreed to without objection.
The Clerk was authorized to correct section numbers, punctuation, and cross references, and to make other necessary technical and conforming corrections in the engrossment of H.R. 1994.
Received in the Senate.