A bill to amend section 403(B)(2) of the Internal Revenue Code of 1954 with respect to computation of the exclusion allowance for ministers and lay employees of a church; to add new section 430(B) annuity contract includes an annuity contract of a church, including a church pension board; to conform section 403(c) with recent amendments to 402(a)(1); to amend section 415(c)(4) to extend the special elections for section 430(b) annuity contracts to employees of churches or conventions or associations of churches and their agencies; to add a new section 415 (c)(8) to permit a de minimis contribution amount in lieu of such elections; and to make a clarifying amendment to section 415(c) by adding a new paragraph (9) and conforming amendments to sections 415(d)(1), 415(d)(2), and 403(b)(2)(B).

Amends the Internal Revenue Code to revise the tax treatment of church annuity plans.

Extends to clergy and church employees the same election of alternative exclusion allowances for contributions to annuity contracts which is currently available to employees of tax-exempt health and education organizations. Treats all years of employment by clergy and church employees as employment for one employer for purposes of the employee exclusion allowance for contributions to a church annuity plan.

Establishes a minimum level of compensation for clergy and church employees for purposes of computing the exclusion allowance for contributions to a church annuity plan. Specifies that such minimum level shall not be less than twice the nonfarm income poverty level of a family of four as determined by the Secretary of the Treasury.

Defines "annuity contracts", for purposes of the employee exclusion, to include those provided by a church or church pension board. Prohibits the application of the constructive receipts doctrine to the computation of annuity amounts.

Permits clergy or church employees to contribute up to $10,000 to a church annuity plan without exceeding statutory limitations on contributions to such plans. Provides for cost of living adjustments to such amount.