I

103D CONGRESS

1ST SESSION H. R. 527

To amend the Internal Revenue Code of 1986 to permit individuals who

withdrew certain amounts from individual retirement accounts to

recontribute such amounts.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 21, 1993

Mr. NEAL of Massachusetts introduced the following bill; which was referred

to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to permit

individuals who withdrew certain amounts from individual retirement accounts to recontribute such amounts.

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

3 That (a) section 219 of the Internal Revenue Code of

4 1986 (relating to retirement savings) is amended by redes5 ignating subsection (h) as subsection (i) and by inserting

6 after subsection (g) the following new subsection:

7 ‘‘(h) RESTORATION OF CERTAIN EARLY WITHDRAW8 ALS.—
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1 ‘‘(1) IN GENERAL.—If an individual received a

2 distribution described in paragraph (4) from an indi3 vidual retirement plan, such individual may

4 recontribute such distribution to an individual retire5 ment plan in the manner provided in this subsection.

6 ‘‘(2) METHOD OF MAKING RECONTRIBUTION.—

7 Any recontribution of a distribution described in

8 paragraph (4) received by any individual—

9 ‘‘(A) may be made only during the 5-year

10 period beginning on the later of the date on

11 which such distribution was received or the date

12 of the enactment of this subsection,

13 ‘‘(B) shall not exceed the amount of such

14 distribution reduced by any prior recontribution

15 under this subsection with respect to such dis16 tribution, and

17 ‘‘(C) shall be made by making a payment

18 in cash to an individual retirement plan for the

19 benefit of such individual.

20 An individual making a contribution as

21 recontribution under this subsection shall designate

22 (in the manner prescribed by the Secretary) such

23 contribution as a recontribution under this sub24 section and shall specify the distribution in respect

25 of which such recontribution is being made.
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1 ‘‘(3) TREATMENT OF RECONTRIBUTION.—

2 ‘‘(A) DEDUCTION ALLOWED.—There shall

3 be allowed as a deduction to an individual mak4 ing a recontribution under this subsection an

5 amount which bears the same ratio to the

6 amount of such recontribution as the portion of

7 the distribution (with respect to which such

8 recontribution is being made) which was includ9 ible in gross income bears to the entire amount

10 of such distribution. Such deduction shall be al11 lowed for the taxable year in which such

12 recontribution is made.

13 ‘‘(B) TREATED AS ROLLOVER CONTRIBU14 TION.—Any recontribution under this sub15 section shall be treated as a rollover contribu16 tion described in section 408(d)(3) for purposes

17 of this section (other than this subsection), sec18 tion 408, and section 4973.

19 ‘‘(4) DISTRIBUTIONS TO WHICH SUBSECTION

20 APPLIES.—A distribution is described in this para21 graph if—

22 ‘‘(A) such distribution is received during

23 the 6-year period beginning on the date 3 years

24 before the date of the enactment of this sub25 section, and
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1 ‘‘(B) an additional tax was imposed under

2 section 72(t) with respect to such distribution.’’

3 (b) The amendment made by subsection (a) shall

4 apply to taxable years ending after the date of the enact5 ment of this Act.

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