Provision Effective 2004 2005 2006 2007 2008 2009 2010 20

Diversification of Pension Plan generally pyba 12/31/03 Assets ........................................................................... & DOE Information to Assist Pension Plan Participants [1].................................................................. various --- -12 -19 -22 -24 -27 -7 Protection of Pension Plan Participants .............................. various Other Provisions Relating to Pensions 

A. Provisions Relating to Pension Plan Funding

1. Replacement of interest rate on 30-year 

Treasury securities used for certain pension plan generallypurposes and other funding provisions [2] .......................... pyba 12/31/03 3,890 6,547 3,843 1,186 -970 -2,661 -3,649 -3,6

2. Update deduction rules for combination plans .................... cf tyba 12/31/04 --- -12 -24 -30 -30 -30 -30 -

B. Improvements in Portability and Distribution Provisions

1. Purchase of permissive service credit ................................. [3] 2. Rollover of after-tax amounts .............................................. tyba 12/31/043. Application of minimum distribution rules to 

governmental plans ............................................................. DOE 

4. Inapplicability of 10% additional tax on early 

distributions from pension plans of public safety employees ........................................................................... da DOE [4] -2 -3 -3 -3 -3 -3 

5. Allow rollovers by nonspouse beneficiaries of

certain retirement plan distributions..................................... dma 12/31/04 --- -8 -24 -32 -35 -32 -28 -

6. Faster vesting of employer nonelective generally 

contributions......................................................................... cf pyba 12/31/04

7. Allow direct rollovers from retirement plans to Roth

IRAs...................................................................................... dma 12/31/04

8. Elimination of higher early withdrawal tax on certain

SIMPLE distributions............................................................ pyba 12/31/04 --- [4] -1 -1 -1 -1 -1 

9. SIMPLE plan portability [5] .................................................. pyba 12/31/04 

10. Eligibility for participation in section 457 plans..................... DOE 11. Benefit transfers to the PBGC.............................................. [6]

C. Administrative Provisions

1. Improvement of employee plans compliance 

resolution system ................................................................ DOE 

2. Extension to all governmental plans of moratorium 

on application of certain nondiscrimination rules applicable to State and local government plans .................. pyba 12/31/04 

 AND AS PROPOSED TO BE MODIFIED ON FEBRUARY 2, 2004

[Millions of Dollars] 

 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 

 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 

 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - No Revenue Effect - - - - 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 

ESTIMATED BUDGET EFFECTS OF 

THE "NATIONAL EMPLOYEE SAVINGS AND TRUST EQUITY GUARANTEE ACT,"

AS ORDERED REPORTED BY THE COMMITTEE ON FINANCE ON SEPTEMBER 17, 2003,

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 

Fiscal Years 2004 - 2013 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 

- - - - - - - - - - - - - - - - - - - - - - - - - Estimate to be Provided by the Congressional 
Page 2

Provision Effective 2004 2005 2006 2007 2008 2009 2010 20

3. Notice and consent period regarding distributions .............. yba 12/31/04 4. Pension plan reporting simplification ................................... generally pybo/a 1/1/045. Missing participants [5] ........................................................ dma fripp [4] [4] [4] [4] [4] [4] [4] 6. Reduced PBGC premiums for small and new pfea 12/31/04 & 

plans [7] ............................................................................... pyba 12/31/04 --- [4] -3 -5 -6 -7 -7 

7. Authorization for PBGC to pay interest on premium 

overpayment refunds [5] ...................................................... iafpbnet DOE -2 -3 -3 -3 -3 -3 -3 

8. Rules for substantial owner benefits in terminated 

plans [5] ............................................................................... [8] --- [4] [4] [4] [4] [4] [4] 

9. Voluntary early retirement incentive and 

employment retention plans maintained by local educational agencies and other entities .............................. generally DOE -2 -4 -7 -9 -11 -11 -11 -

10. 2-year extension of transition rule to pension funding 

requirements ....................................................................... pyba 12/31/03 2 6 2 -3 -2 -2 -2 

11. Acceleration of PBGC computation of benefits 

attributable to recoveries from employers [5] ...................... noitto/a 30da DOE 

12. Multiemployer plan explanation notice ................................. pyba 12/31/05 13. No reduction in unemployment compensation as a 

result of pension rollovers [5] .............................................. wbo/a DOE 

14. Withholding on certain distributions from 457

governmental eligible deferred compensation plans ........... [6] -3 1 1 [9] [9] [9] [9] 

15. Minimum cost requirement for excess asset transfers......... tyea DOE 16. Social Security coverage under divided retirement 

system for public employees in Kentucky [10] ..................... 1/1/03 2 1 2 2 3 3 3 

D. Studies ................................................................................. DOE 

E. Other Provisions

1. Additional IRA catch-up contributions for certain 

individuals (sunset for taxable years beginning after 12/31/08) ..................................................................... tyba 12/31/03 -1 -3 -4 -6 -7 -6 -3 

2. Distributions by an S corp to an employee stock 

ownership plan .................................................................... 1/1/98 [4] [4] [4] [4] [4] [4] [4] 

3. Allow transfers of excess pension plan assets to 

multiemployer retiree health plan ........................................ tyba 12/31/04 --- [9] [9] [9] [9] [9] [9] 

F. Plan amendments ............................................................... DOE 

Total of Other Provisions Relating to Pensions ...................................................... 3,886 6,523 3,779 1,096 -1,065 -2,753 -3,734 -3,6Provisions Relating to Executives and Stock Options 

A. Provisions Relating to Executives

1. Repeal of limitation on issuance of Treasury 

guidance regarding nonqualified deferred compensation ...................................................................... tyba DOE 

2. Include in income certain nonqualified deferred 

compensation, including compensation funded with assets located outside the United States ............................ adi tyba 12/31/04 -5 133 122 42 21 20 18 1

3. Deferral of certain stock option and restricted stock 

option gains prohibited [11] ................................................. after 12/31/04 --- 11 6 2 1 1 1 

4. Increase in withholding from supplemental wage 

payments in excess of $1 million ......................................... pma 12/31/03 99 12 44 5 [9] [9] [9] 

 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - No Revenue Effect - - - - 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 

 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - No Revenue Effect - - - -  - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - No Revenue Effect - - - - 

- - - - - - - - - - - - - - - - - - - - - - - - - Estimate to be Provided by the Congressional 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 

 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - No Revenue Effect - - - - 
Page 3

Provision Effective 2004 2005 2006 2007 2008 2009 2010 20

B. Stock Options

1. Exclusion of incentive stock options and employee 

stock purchase plan stock options from wages ................... DOE 

2. Capital gain treatment on sale of stock acquired from 

exercise of statutory stock options to comply with conflict-of-interest requirements .......................................... sa DOE [9] 1 1 1 1 1 1 

Total of Provisions Relating to Executives and Stock Options ............................................................................................................ 94 157 173 50 23 22 20 1Women's Pension Protection Provisions 

A. Joint Study of Application of Spousal Consent Rules

to Defined Contribution Plans .............................................. DOE 

B. Treatment of Subsequent Qualified Domestic 

Relations Orders ................................................................. DOE 

C. Protection of Rights of Former Spouses Under the 

Railroad Retirement System [5] .......................................... 1ya DOE --- [4] [4] [4] -1 -1 -1 

D. Modifications of Joint and Survivor Annuity generally 

Requirements ...................................................................... pyba 12/31/04 

Total of Women's Pension Protection Provisions ................................................... [12] [4] [4] [4] -1 -1 -1 Tax Court Pension and Compensation Modernization Provisions [13] [14] .................................... generally DOE -3 [4] [4] [4] [4] [4] [4] Other Provisions 

A. General Provisions

1. Exclusion for postsecondary educational

benefits provided by an employer to children of of employees (sunset 12/31/05)......................................... tyba 12/31/04 --- -130 -44 --- --- --- --- 

2. Exclusion for payments under the National Health

Service Corps Loan Repayment Program ........................... tyba 12/31/04 --- [15] -1 -1 -2 -3 -3 

3. Temporary exclusion for group legal services

benefits (sunset 12/31/05) ................................................... tyba 12/31/04 --- -85 -34 --- --- --- --- 

4. Transfer of funds from Black Lung Trust Fund to

combined fund [16]............................................................... DOE 

B. Revenue Provisions

1. Extend provision under section 420 permitting 

qualified transfers of excess defined benefit pension plan assets to 401(h) accounts (through 12/31/13) ............................................................................. DOE --- --- 18 38 40 40 40 

2. Limit basis step-up for imported pensions ........................... doo/a DOE 2 12 13 14 15 15 16 3. Modify the taxation of death benefits for certain

employer-owned life insurance contracts............................. cia DOE - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 

 - - - - - - - - - - - - - - - - - - - - - - - - - - - The Net Effect of Revenues and Outlays is 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 

 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - No Revenue Effect - - - -  - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - No Revenue Effect - - - - 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Negligible Revenue Effect - - 
Page 4

Provision Effective 2004 2005 2006 2007 2008 2009 2010 20

4. Modification of Certain Insurance Company Rules - 

limit 501(c)(15) to organizations with annual grossreceipts not to exceed $600,000 and with premiumsgreater than 50% of gross receipts; and modifydefinition of insurance company for P&C companiesfor exemption and investment income electionpurposes............................................................................... tyba 12/31/03 54 120 134 136 138 140 143 1

5. Reporting of taxable mergers and acquisitions ................... aa DOE 1 2 3 3 3 3 3 

Total of Other Provisions .................................................................................... 57 -81 89 190 194 195 199 2

 NET TOTAL ............................................................................................................ 4,034 6,587 4,022 1,314 -873 -2,564 -3,523 -3,3Joint Committee on Taxation -------------------------------------- NOTE: Details may not add to totals due to rounding. Legend for "Effective" column: 

aa = acquisitions after dma = distributions made after adi = amounts deferred in fripp = final regulations implementing the provision are prescribed cf = contributions for iafpbnet = interest accruing for periods beginning not earlier than cia = contracts issued after noitto/a = notice of intent to terminate on or after da = distributions after pfea = plans first effective after DOE = date of enactment pma = payments made after doo/a = distributions occurring on or after pyba = plan years beginning after 

[1] Revenue loss is associated with the provision relating to treatment of qualified retirement planning services. This provision is effective for taxable years beginning after 

December 31, 2004 and before January 1, 2010.

[2] Estimate does not include effects on PBGC variable-rate premiums, which are the responsibility of the Congressional Budget Office.[3] Effective as if included in the amendments made by section 1526(a) of the Taxpayer Relief Act of 1997.[4] Loss of less than $500,000. [5] Estimate reflects outlay effects provided by the Congressional Budget Office.[6] Effective as if included in the Economic Growth and Tax Relief Reconciliation Act of 2001.[7] Estimate provided by the Congressional Budget Office. PBGC premiums are offsetting collections to a mandatory spending account, thus reductions (increases) in prem

are reflected as increases (decreases) in direct spending. 

[8] Effective for plan terminations with respect to which notices of intent to terminate are provided, or for which proceedings for termination are instituted by the PBGC, after [9] Gain of less than $500,000. 

[10] Estimate provided by the Congressional Budget Office and includes off-budget revenues and $1 million of off-budget outlays. [11] Estimate includes interaction with item 2.[12] Negligible revenue effect.[13] Certain portions of the estimate were provided by the Congressional Budget Office.

2004 2005 2006 2007 2008 2009 2010 20

[14] Includes the following increase in outlay effects ......................................................... 3 [9] [9] [9] [9] [9] [9] [15] Loss of less than $1 million. [16] The provision eliminates aggregate limit on the amount of excess black lung benefit trust assets that may be used to pay accident and health benefits for coal miners. Re

proposal will be deposited into the UMWA Combined Benefit Fund. The net effect, including both the revenue raised and the outlay effects provided by the Congression