II

106TH CONGRESS

1ST SESSION S. 1209

To amend the Internal Revenue Code of 1986 to restore pension limits

to equitable levels, and for other purposes.

IN THE SENATE OF THE UNITED STATES

JUNE 10, 1999

Mr. MURKOWSKI (for himself, Mr. STEVENS, and Mr. SANTORUM) introduced

the following bill; which was read twice and referred to the Committee

on Finance

A BILL

To amend the Internal Revenue Code of 1986 to restore

pension limits to equitable levels, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. AMENDMENT OF 1986 CODE.

4 Except as otherwise expressly provided, whenever in

5 this Act an amendment or repeal is expressed in terms

6 of an amendment to, or repeal of, a section or other provi7 sion, the reference shall be considered to be made to a

8 section or other provision of the Internal Revenue Code

9 of 1986.
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1 SEC. 2. GENERAL RETIREMENT PLAN LIMITS.

2 (a) DEFINED BENEFIT PLANS.—

3 (1) DOLLAR LIMIT.—

4 (A) IN GENERAL.—Subparagraph (A) of

5 section 415(b)(1) (relating to limitation for de6 fined benefit plans) is amended by striking

7 ‘‘$90,000’’ and inserting ‘‘$180,000’’.

8 (B) AGE ADJUSTMENTS.—Subparagraphs

9 (C) and (D) of section 415(b)(2) are each

10 amended by striking ‘‘$90,000’’ each place it

11 appears in the headings and the text and in12 serting ‘‘$180,000’’.

13 (C) COLLECTIVELY BARGAINED PLANS.—

14 Paragraph (7) of section 415(b) (relating to

15 benefits under certain collectively bargained

16 plans) is amended by striking ‘‘the greater of

17 $68,212 or one-half the amount otherwise ap18 plicable for such year under paragraph (1)(A)

19 for ‘$90,000’ ’’ and inserting ‘‘one-half the

20 amount otherwise applicable for such year

21 under paragraph (1)(A) for ‘$180,000’ ’’.

22 (2) LIMIT REDUCED WHEN BENEFIT BEGINS

23 BEFORE AGE 62.—Subparagraph (C) of section

24 415(b)(2) is amended by striking ‘‘the social security

25 retirement age’’ each place it appears in the heading

26 and text and inserting ‘‘age 62’’.
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1 (3) LIMIT INCREASED WHEN BENEFIT BEGINS

2 AFTER AGE 65.—Subparagraph (D) of section

3 415(b)(2) is amended by striking ‘‘the social security

4 retirement age’’ each place it appears in the heading

5 and text and inserting ‘‘age 65’’.

6 (4) MULTIEMPLOYER PLANS AND PLANS MAIN7 TAINED BY GOVERNMENTS AND TAX EXEMPT ORGA8 NIZATIONS.—Subparagraph (F) of section 415(b)(2)

9 is amended to read as follows:

10 ‘‘(F) MULTIEMPLOYER PLANS AND PLANS

11 MAINTAINED BY GOVERNMENTS AND TAX EX12 EMPT ORGANIZATIONS.—

13 ‘‘(i) IN GENERAL.—In the case of a

14 governmental plan (within the meaning of

15 section 414(d)), a plan maintained by an

16 organization (other than a governmental

17 unit) exempt from tax under this subtitle,

18 a multiemployer plan (as defined in section

19 414(f)), or a qualified merchant marine

20 plan, subparagraph (C) shall be applied as

21 if the last sentence thereof read as follows:

22 ‘The reduction under this subparagraph

23 shall not reduce the limitation of para24 graph (1)(A) below (i) $130,000 if the

25 benefit begins at or after age 55, or (ii) if
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1 the benefit begins before age 55, the equiv2 alent of the $130,000 limitation for age

3 55.’.

4 ‘‘(ii) DEFINITIONS.—For purposes of

5 this subparagraph—

6 ‘‘(I) QUALIFIED MERCHANT MA7 RINE PLAN.—The term ‘qualified mer8 chant marine plan’ means a plan in

9 existence on January 1, 1986, the

10 participants in which are merchant

11 marine officers holding licenses issued

12 by the Secretary of Transportation

13 under title 46, United States Code.

14 ‘‘(II) EXEMPT ORGANIZATION

15 PLAN COVERING 50 PERCENT OF ITS

16 EMPLOYEES.—A plan shall be treated

17 as a plan maintained by an organiza18 tion (other than a governmental unit)

19 exempt from tax under this subtitle if

20 at least 50 percent of the employees

21 benefiting under the plan are employ22 ees of an organization (other than a

23 governmental unit) exempt from tax

24 under this subtitle. If less than 50

25 percent of the employees benefiting
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1 under a plan are employees of an or2 ganization (other than a governmental

3 unit) exempt from tax under this sub4 title, the plan shall be treated as a

5 plan maintained by an organization

6 (other than a governmental unit) ex7 empt from tax under this subtitle only

8 with respect to employees of such an

9 organization.’’

10 (5) COST-OF-LIVING ADJUSTMENTS.—Sub11 section (d) of section 415 (related to cost-of-living

12 adjustments) is amended—

13 (A) in paragraph (1)(A) by striking

14 ‘‘$90,000’’ and inserting ‘‘$180,000’’, and

15 (B) in paragraph (3)(A)—

16 (i) by striking ‘‘$90,000’’ in the head17 ing and inserting ‘‘$180,000’’, and

18 (ii) by striking ‘‘October 1, 1986’’ and

19 inserting ‘‘July 1, 1999’’.

20 (b) DEFINED CONTRIBUTION PLANS.—

21 (1) IN GENERAL.—Subparagraph (B) of section

22 415(c)(1) (relating to limitation for defined con23 tribution plans) is amended to read as follows:

24 ‘‘(B) the participants’ compensation.’’
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1 (2) CONFORMING AMENDMENT.—Section

2 415(n)(2)(B) is amended by striking ‘‘percentage’’.

3 (c) COST-OF-LIVING ADJUSTMENTS.—

4 (1) PLANS MAINTAINED BY GOVERNMENTS AND

5 TAX EXEMPT ORGANIZATIONS.—Paragraph (1) of

6 section 415(d) (as amended by subsection (a)) is

7 amended by striking ‘‘and’’ at the end of subpara8 graph (B), by redesignating subparagraph (C) as

9 subparagraph (D), and by inserting after subpara10 graph (B) the following new subparagraph:

11 ‘‘(C) the $130,000 amount in subsection

12 (b)(2)(F), and.’’

13 (2) BASE PERIOD.—Paragraph (3) of section

14 415(d) (as amended by subsection (a)) is amended

15 by redesignating subparagraph (D) as subparagraph

16 (E) and by inserting after subparagraph (C) the fol17 lowing new subparagraph:

18 ‘‘(D) $130,000 AMOUNT.—The base period

19 taken into account for purposes of paragraph

20 (1)(C) is the calendar quarter beginning July 1,

21 1999.’’

22 (3) ROUNDING RULE RELATING TO DEFINED

23 BENEFIT PLANS.—Paragraph (4) of section 415(d)

24 is amended to read as follows:

25 ‘‘(4) ROUNDING.—
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1 ‘‘(A) $180,000 AMOUNT.—Any increase

2 under subparagraph (A) or (D) of paragraph

3 (1) which is not a multiple of $5,000 shall be

4 rounded to the next lowest multiple of $5,000.

5 ‘‘(B) $130,000 AMOUNT.—Any increase

6 under subparagraph (C) of paragraph (1) which

7 is not a multiple of $1,000 shall be rounded to

8 the next lowest multiple of $1,000.’’

9 (4) CONFORMING AMENDMENT.—Subparagraph

10 (D) of section 415(d)(3) (as amended by paragraph

11 (2)) is amended by striking ‘‘paragraph (1)(C)’’ and

12 inserting ‘‘paragraph (1)(D)’’.

13 SEC. 3. TREATMENT OF MULTIEMPLOYER PLANS UNDER

14 SECTION 415.

15 (a) COMPENSATION LIMIT.—Paragraph (11) of sec16 tion 415(b) (relating to limitation for defined benefit

17 plans) is amended to read as follows:

18 ‘‘(11) SPECIAL LIMITATION RULE FOR GOVERN19 MENTAL AND MULTIEMPLOYER PLANS.—In the case

20 of a governmental plan (as defined in section

21 414(d)) or a multiemployer plan (as defined in sec22 tion 414(f)), subparagraph (B) of paragraph (1)

23 shall not apply.’’

24 (b) COMBINING AND AGGREGATION OF PLANS.—
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1 (1) COMBINING OF PLANS.—Subsection (f) of

2 section 415 (relating to combining of plans) is

3 amended by adding at the end the following:

4 ‘‘(3) EXCEPTION FOR MULTIEMPLOYER

5 PLANS.—Notwithstanding paragraph (1) and sub6 section (g), a multiemployer plan (as defined in sec7 tion 414(f)) shall not be combined or aggregated

8 with any other plan maintained by an employer for

9 purposes of applying the limitations established in

10 this section, except that such plan shall be combined

11 or aggregated with another plan which is not such

12 a multiemployer plan solely for purposes of deter13 mining whether such other plan meets the require14 ments of subsection (b)(1)(A).’’.

15 (2) CONFORMING AMENDMENT FOR AGGREGA16 TION OF PLANS.—Subsection (g) of section 415 (re17 lating to aggregation of plans) is amended by strik18 ing ‘‘The Secretary’’ and inserting ‘‘Except as pro19 vided in subsection (f)(3), the Secretary’’.

20 SEC. 4. EFFECTIVE DATE.

21 The amendments made by this Act shall apply to

22 years beginning after December 31, 1999.

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