II 

110TH CONGRESS 

2D SESSION S. 3719 

To amend the Internal Revenue Code of 1986 to suspend the minimum 

required pension distribution rules for 2008, 2009, and 2010. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 8 (legislative day, NOVEMBER 20), 2008 

Ms. SNOWE (for herself and Mr. HATCH) 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 suspend 

the minimum required pension distribution rules for 

2008, 2009, and 2010. 

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 ‘‘Retirement Account 

5 Distribution Improvement Act of 2008’’. 

6 SEC. 2. TEMPORARY WAIVER OF REQUIRED MINIMUM DIS7 TRIBUTION RULES FOR CERTAIN RETIRE8 MENT PLANS AND ACCOUNTS. 

9 (a) IN GENERAL.—Section 401(a)(9) of the Internal 

10 Revenue Code of 1986 (relating to required distributions) 

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1 is amended by adding at the end the following new sub2 paragraph: 

3 ‘‘(H) TEMPORARY WAIVER OF MINIMUM

4 REQUIRED DISTRIBUTION.— 

5 ‘‘(i) IN GENERAL.—The requirements 

6 of this paragraph shall not apply in cal7 endar year 2008, 2009, or 2010 to— 

8 ‘‘(I) a defined contribution plan 

9 which is described in this subsection 

10 or in section 403(a) or 403(b), 

11 ‘‘(II) a defined contribution plan 

12 which is an eligible deferred com13 pensation plan described in section 

14 457(b) but only if such plan is main15 tained by an employer described in 

16 section 457(e)(1)(A), or 

17 ‘‘(III) an individual retirement 

18 plan. 

19 ‘‘(ii) PLANS ONLY TO MAKE ELECTIVE

20 DISTRIBUTIONS.—A trust forming part of 

21 a plan shall not constitute a qualified trust 

22 under this subsection unless the plan pro23 vides that it will not make a payment or 

24 distribution during calendar year 2009 or 

25 2010 which would otherwise be made to 

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1 meet the requirements of this paragraph 

2 unless the employee or beneficiary elects to 

3 have such payment or distribution made. 

4 This clause shall not apply to an employee 

5 or beneficiary who is receiving, after the 

6 annuity starting date, distributions under 

7 the plan through an annuity contract 

8 issued by a company licensed to do busi9 ness as an insurance company under the 

10 laws of any State. 

11 ‘‘(iii) ELECTION.—An election under 

12 clause (ii) shall be made at such time and 

13 in such manner as the Secretary may pre14 scribe. The Secretary may permit an em15 ployer to offer only 1 election that applies 

16 to 2009 and 2010 or may require employ17 ers to offer separate elections for each cal18 endar year. 

19 ‘‘(iv) INDIVIDUAL RETIREMENT PLANS

20 EXEMPT FROM ELECTIVE DISTRIBUTION

21 REQUIREMENT.—In the case of an indi22 vidual retirement account or annuity de23 scribed in section 408, this subparagraph 

24 shall be applied without regard to clauses 

25 (ii) and (iii). 

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1 ‘‘(v) SPECIAL RULES REGARDING

2 WAIVER PERIOD.—For purposes of this 

3 paragraph— 

4 ‘‘(I) the required beginning date 

5 with respect to any individual shall be 

6 determined without regard to this 

7 subparagraph for purposes of applying 

8 this paragraph to calendar years after 

9 2010, and 

10 ‘‘(II) if clause (ii) of subpara11 graph (B) applies to such individual, 

12 the 5-year period described in such 

13 clause shall be determined without re14 gard to calendar years 2008, 2009, or 

15 2010.’’. 

16 (b) ELIGIBLE ROLLOVER DISTRIBUTIONS.—Section 

17 402(c)(4) of the Internal Revenue Code of 1986 (defining 

18 eligible rollover distribution) is amended by adding at the 

19 end the following new flush sentence: 

20 ‘‘If all or any portion of a distribution during 2008, 

21 2009, or 2010 is treated as an eligible rollover dis22 tribution but would not be so treated if the min23 imum distribution requirements under section 

24 401(a)(9) had applied during such calendar year, 

25 such distribution shall not be treated as an eligible 

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1 rollover distribution for purposes of section 

2 401(a)(31) or 3405(c) or subsection (f) of this sec3 tion’’. 

4 (c) EFFECTIVE DATES.— 

5 (1) IN GENERAL.—The amendments made by 

6 this section shall apply to taxable years beginning 

7 after December 31, 2007. 

8 (2) RECONTRIBUTIONS OF DISTRIBUTIONS IN

9 2008 OR EARLY 2009.— 

10 (A) IN GENERAL.—If a person receives 1 

11 or more eligible distributions, the person may, 

12 on or before July 1, 2009, make one or more 

13 contributions (in an aggregate amount not ex14 ceeding all eligible distributions) to an eligible 

15 retirement plan and to which a rollover con16 tribution of such distribution could be made 

17 under section 402(c), 403(a)(4), 403(b)(8), 

18 408(d)(3), or 457(e)(16) of the Internal Rev19 enue Code of 1986, as the case may be. For 

20 purposes of the preceding sentence, rules simi21 lar to the rules of clauses (ii) and (iii) of sec22 tion 402(c)(11)(A) of such Code shall apply in 

23 the case of a beneficiary who is not the sur24 viving spouse of the employee or of the owner 

25 of the individual retirement plan. 

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1 (B) ELIGIBLE DISTRIBUTION.—For pur2 poses of this paragraph— 

3 (i) IN GENERAL.—Except as provided 

4 in clause (ii), the term ‘‘eligible distribu5 tion’’ means an applicable distribution to a 

6 person from an individual account or annu7 ity— 

8 (I) under a plan which is de9 scribed in clause (iv), and 

10 (II) from which a distribution 

11 would, but for the application of sec12 tion 401(a)(9)(H) of such Code, have 

13 been required to have been made to 

14 the individual for 2008 or 2009, 

15 whichever is applicable, in order to 

16 satisfy the requirements of sections 

17 401(a)(9), 404(a)(2), 403(b)(10), 

18 408(a)(6), 408(b)(3), and 457(d)(2) 

19 of such Code. 

20 (ii) ELIGIBLE DISTRIBUTIONS LIM21 ITED TO REQUIRED DISTRIBUTIONS.—The 

22 aggregate amount of applicable distribu23 tions which may be treated as eligible dis24 tributions for purposes of this paragraph 

25 shall not exceed— 

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1 (I) for purposes of applying sub2 paragraph (A) to distributions made 

3 in 2008, the amount which would, but 

4 for the application of section 

5 401(a)(9)(H) of such Code, have been 

6 required to have been made to the in7 dividual in order to satisfy the re8 quirements of sections 401(a)(9), 

9 404(a)(2), 403(b)(10), 408(a)(6), 

10 408(b)(3), and 457(d)(2) of such 

11 Code for 2008, and 

12 (II) for purposes of applying sub13 paragraph (A) to distributions made 

14 in 2009, the sum of the amount which 

15 would, but for the application of such 

16 section 401(a)(9)(H), have been re17 quired to have been made to the indi18 vidual in order to satisfy such require19 ments for 2009, plus the excess (if 

20 any) of the amount described in sub21 clause (I) which may be distributed in 

22 2009 to meet such requirements for 

23 2008 over the portion of such amount 

24 taken into account under subclause 

25 (I) for distributions made in 2008. 

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1 (iii) APPLICABLE DISTRIBUTION.— 

2 (I) IN GENERAL.—The term ‘‘ap3 plicable distribution’’ means a pay4 ment or distribution which is made 

5 during the period beginning on Janu6 ary 1, 2008, and ending on June 30, 

7 2009. 

8 (II) EXCEPTION FOR MINIMUM

9 REQUIRED DISTRIBUTIONS FOR

10 OTHER YEARS.—Such term shall not 

11 include a payment or distribution 

12 which is required to be made in order 

13 to satisfy the requirements of section 

14 401(a)(9), 404(a)(2), 403(b)(10), 

15 408(a)(6), 408(b)(3), or 457(d)(2) of 

16 such Code for a calendar year other 

17 than 2008 or 2009. 

18 (III) EXCEPTION FOR PAYMENTS

19 IN A SERIES.—In the case of any plan 

20 described in clause (iv)(I), such term 

21 shall not include any payment or dis22 tribution made in 2009 which is a 

23 payment or distribution described in 

24 section 402(c)(4)(A). 

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1 (iv) PLANS DESCRIBED.—A plan is 

2 described in this clause if the plan is— 

3 (I) a defined contribution plan 

4 (within the meaning of section 414(i) 

5 of such Code) which is described in 

6 section 401, 403(a), or 403(b) of such 

7 Code or which is an eligible deferred 

8 compensation plan described in sec9 tion 457(b) of such Code maintained 

10 by an eligible employer described in 

11 section 457(e)(1)(A) of such Code, or 

12 (II) an individual retirement plan 

13 (as defined in section 7701(a)(37) of 

14 such Code). 

15 (C) TREATMENT OF REPAYMENTS OF DIS16 TRIBUTIONS FROM ELIGIBLE RETIREMENT

17 PLANS OTHER THAN IRAS.—For purposes of 

18 the Internal Revenue Code of 1986, if a con19 tribution is made pursuant to subparagraph (A) 

20 with respect to a payment or distribution from 

21 a plan other than an individual retirement plan, 

22 then the taxpayer shall, to the extent of the 

23 amount of the contribution, be treated as hav24 ing received the payment or distribution in an 

25 eligible rollover distribution (as defined in secmstockstill on PROD1PC66 with BILLS

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1 tion 402(c)(4) of such Code) and as having 

2 transferred the amount to the plan in a direct 

3 trustee to trustee transfer. 

4 (D) TREATMENT OF REPAYMENTS FOR

5 DISTRIBUTIONS FROM IRAS.—For purposes of 

6 the Internal Revenue Code of 1986, if a con7 tribution is made pursuant to subparagraph (A) 

8 with respect to a payment or distribution from 

9 an individual retirement plan (as defined by 

10 section 7701(a)(37) of such Code), then, to the 

11 extent of the amount of the contribution, such 

12 payments or distributions shall be treated as a 

13 distribution that satisfies subparagraphs (A) 

14 and (B) of section 408(d)(3) of such Code and 

15 as having been transferred to the individual re16 tirement plan in a direct trustee to trustee 

17 transfer. 

18 (3) PROVISIONS RELATING TO PLAN OR CON19 TRACT AMENDMENTS.— 

20 (A) IN GENERAL.—If this paragraph ap21 plies to any pension plan or contract amend22 ment, such pension plan or contract shall be 

23 treated as being operated in accordance with 

24 the terms of the plan during the period de25 scribed in subparagraph (B)(ii)(I). 

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1 (B) AMENDMENTS TO WHICH PARAGRAPH

2 APPLIES.— 

3 (i) IN GENERAL.—This paragraph 

4 shall apply to any amendment to any pen5 sion plan or annuity contract which— 

6 (I) is made by pursuant to the 

7 amendments made by this section, 

8 and 

9 (II) is made on or before the last 

10 day of the first plan year beginning 

11 on or after January 1, 2011. 

12 In the case of a governmental plan, sub13 clause (II) shall be applied by substituting 

14 ‘‘2012’’ for ‘‘2011’’. 

15 (ii) CONDITIONS.—This paragraph 

16 shall not apply to any amendment unless— 

17 (I) during the period beginning 

18 on January 1, 2009, and ending on 

19 December 31, 2010 (or, if earlier, the 

20 date the plan or contract amendment 

21 is adopted), the plan or contract is op22 erated as if such plan or contract 

23 amendment were in effect; and 

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1 (II) such plan or contract amend2 ment applies retroactively for such pe3 riod. 

Æ 

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