I 

113TH CONGRESS 

1ST SESSION H. R. 2134 

To provide an election for funding parity for charity-sponsored pension plans. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 23, 2013 

Mrs. BROOKS of Indiana (for herself and Mr. KIND) introduced the following 

bill; which was referred to the Committee on Education and the Workforce, and in addition to the Committee on Ways and Means, 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 provide an election for funding parity for charitysponsored pension plans. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Charitable Pension 

5 Flexibility Act of 2013’’. 

6 SEC. 2. ELECTION TO CEASE TO BE TREATED AS AN ELIGI7 BLE CHARITY PLAN. 

8 (a) IN GENERAL.—Subsection (d) of section 104 of 

9 the Pension Protection Act of 2006, as added by section 


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1 202 of the Preservation of Access to Care for Medicare 

2 Beneficiaries and Pension Relief Act of 2010, is amended 

3 by— 

4 (1) striking ‘‘For purposes of’’ and inserting 

5 ‘‘(1) IN GENERAL.—For purposes of’’, and 

6 (2) adding at the end the following: 

7 ‘‘(2) ELECTION NOT TO BE AN ELIGIBLE CHAR8 ITY PLAN.—A plan sponsor may elect for a plan to 

9 cease to be treated as an eligible charity plan for 

10 plan years beginning after December 31, 2013. Such 

11 election shall be made at such time and in such form 

12 and manner as shall be prescribed by the Secretary 

13 of the Treasury. Any such election may be revoked 

14 only with the consent of the Secretary of the Treas15 ury. 

16 ‘‘(3) ELECTION TO USE FUNDING OPTIONS

17 AVAILABLE TO OTHER PLAN SPONSORS.— 

18 ‘‘(A) IN GENERAL.—A plan sponsor that 

19 makes the election described in paragraph (2) 

20 may also elect for a plan to apply the rules de21 scribed in subparagraphs (B), (C), and (D) for 

22 plan years beginning after December 31, 2013. 

23 Such election shall be made at such time and 

24 in such form and manner as shall be prescribed 

25 by the Secretary of the Treasury. Any such 


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1 election may be revoked only with the consent 

2 of the Secretary of the Treasury. 

3 ‘‘(B) APPLICABLE SHORTFALL AMORTIZA4 TION BASES.—Under the rules described in this 

5 subparagraph, for the first plan year beginning 

6 after December 31, 2013, a plan has— 

7 ‘‘(i) an 11-year shortfall amortization 

8 base, 

9 ‘‘(ii) a 12-year shortfall amortization 

10 base, and 

11 ‘‘(iii) a 7-year shortfall amortization 

12 base. 

13 ‘‘(C) DETERMINATION OF INSTALL14 MENTS.—Under the rules described in this sub15 paragraph, section 430(c)(2)(A) and (B) of the 

16 Internal Revenue Code of 1986 and section 

17 303(c)(2)(A) and (B) of the Employee Retire18 ment Income Security Act of 1974 shall be ap19 plied— 

20 ‘‘(i) in the case of an 11-year shortfall 

21 amortization base, by substituting ‘11- 

22 plan-year period’ for ‘7-plan-year period’ 

23 wherever it appears, and 

24 ‘‘(ii) in the case a 12-year shortfall 

25 amortization base, by substituting ‘12- 


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1 plan-year period’ for ‘7-plan-year period’ 

2 wherever it appears. 

3 ‘‘(D) ALTERNATE REQUIRED INSTALL4 MENTS.—Under the rules described in this sub5 paragraph, section 430(c)(7) of the Internal 

6 Revenue Code of 1986 and section 303(c)(7) of 

7 the Employee Retirement Income Security Act 

8 of 1974 shall apply to a plan for which an elec9 tion has been made under subparagraph (A). 

10 Such provisions shall apply in the following 

11 manner: 

12 ‘‘(i) The first plan year beginning 

13 after December 31, 2013, shall be treated 

14 as an election year, and no other plan 

15 years shall be so treated. 

16 ‘‘(ii) All references in section 

17 430(c)(7) of such Code and in section 

18 303(c)(7) of such Act to ‘February 28, 

19 2010’ or ‘March 1, 2010’ shall be treated 

20 as references to ‘February 28, 2013’ or 

21 ‘March 1, 2013’, respectively. 

22 ‘‘(E) 11-YEAR SHORTFALL AMORTIZATION

23 BASE.—For purposes of this paragraph, the 11- 

24 year shortfall amortization base is an amount, 

25 determined for the first plan year beginning 


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1 after December 31, 2013, equal to the 

2 unamortized principal amount of the shortfall 

3 amortization base (as defined in section 

4 430(c)(3) of the Internal Revenue Code of 1986 

5 and section 303(c)(3) of the Employee Retire6 ment Income Security Act of 1974) that would 

7 have applied to the plan for the first plan year 

8 beginning after December 31, 2009, if— 

9 ‘‘(i) the plan had never been an eligi10 ble charity plan. 

11 ‘‘(ii) the plan sponsor had made the 

12 election described in section 

13 430(c)(2)(D)(i) of the Internal Revenue 

14 Code of 1986 and in section 

15 303(c)(2)(D)(i) of the Employee Retire16 ment Income Security Act of 1974 to have 

17 section 430(c)(2)(D)(iii) of such Code and 

18 section 303(c)(2)(D)(iii) of such Act apply 

19 with respect to the shortfall amortization 

20 base for the first plan year beginning after 

21 December 31, 2009, and 

22 ‘‘(iii) no event had occurred under 

23 paragraph (6) or (7) of section 430(c) of 

24 such Code or paragraph (6) or (7) of sec25 tion 303(c) of such Act that, as of the first 


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1 day of the first plan year beginning after 

2 December 31, 2013, would have modified 

3 the shortfall amortization base or the 

4 shortfall amortization installments with re5 spect to the first plan year beginning after 

6 December 31, 2009. 

7 ‘‘(F) 12-YEAR SHORTFALL AMORTIZATION

8 BASE.—For purposes of this paragraph, the 12- 

9 year shortfall amortization base is an amount, 

10 determined for the first plan year beginning 

11 after December 31, 2013, equal to the 

12 unamortized principal amount of the shortfall 

13 amortization base (as defined in section 

14 430(c)(3) of the Internal Revenue Code of 1986 

15 and section 303(c)(3) of the Employee Retire16 ment Income Security Act of 1974) that would 

17 have applied to the plan for the first plan be18 ginning after December 31, 2010, if— 

19 ‘‘(i) the plan had never been an eligi20 ble charity plan, 

21 ‘‘(ii) the plan sponsor had made the 

22 election described in section 

23 430(c)(2)(D)(i) of the Internal Revenue 

24 Code of 1986 and in section 

25 303(c)(2)(D)(i) of the Employee RetireVerDate Mar 15 2010 02:30 May 30, 2013 Jkt 029200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H2134.IH H2134

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1 ment Income Security Act of 1974 to have 

2 section 430(c)(2)(D)(iii) of such Code and 

3 section 303(c)(2)(D)(iii) of such Act apply 

4 with respect to the shortfall amortization 

5 base for the first plan year beginning after 

6 December 31, 2010, and 

7 ‘‘(iii) no event had occurred under 

8 paragraph (6) or (7) of section 430(c) of 

9 such Code or paragraph (6) or (7) of sec10 tion 303(c) of such Act that, as of the first 

11 day of the first plan year beginning after 

12 December 31, 2013, would have modified 

13 the shortfall amortization base or the 

14 shortfall amortization installments with re15 spect to the first plan year beginning after 

16 December 31, 2010. 

17 ‘‘(G) 7-YEAR SHORTFALL AMORTIZATION

18 BASE.—For purposes of this paragraph, the 7- 

19 year shortfall amortization base is an amount, 

20 determined for the first plan year beginning 

21 after December 31, 2013, equal to— 

22 ‘‘(i) the shortfall amortization base for 

23 the first plan year beginning after Decem24 ber 31, 2013, without regard to this para25 graph, minus 


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1 ‘‘(ii) the sum of the 11-year shortfall 

2 amortization base and the 12-year shortfall 

3 amortization base.’’. 

4 (b) EFFECTIVE DATE.—The amendments made by 

5 this section shall take effect on the date of the enactment 

6 of this Act. 

Æ 


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