II 

114TH CONGRESS 

1ST SESSION S. 616 

To amend the Internal Revenue Code of 1986 to provide recruitment and 

retention incentives for volunteer emergency service workers. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 27, 2015 

Ms. COLLINS (for herself and Mr. SCHUMER) 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 provide 

recruitment and retention incentives for volunteer emergency service workers. 

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 ‘‘Volunteer Emergency 

5 Services Recruitment and Retention Act of 2015’’. 


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1 SEC. 2. ELECTIVE TREATMENT OF LENGTH OF SERVICE 

2 AWARD PROGRAMS AS ELIGIBLE DEFERRED 

3 COMPENSATION PLANS. 

4 (a) IN GENERAL.—Section 457(e) of the Internal 

5 Revenue Code of 1986 is amended by adding at the end 

6 the following new paragraph: 

7 ‘‘(19) SPECIAL RULES APPLICABLE TO LENGTH

8 OF SERVICE AWARD PLANS.— 

9 ‘‘(A) IN GENERAL.—The term ‘eligible de10 ferred compensation plan’ shall include, at the 

11 election of its sponsor, any length of service 

12 award plan. Any such election shall be irrev13 ocable. In the case of a length of service award 

14 plan whose sponsor has elected to have such 

15 plan treated as an eligible deferred compensa16 tion plan, such plan shall be administered in a 

17 manner consistent with the requirements of this 

18 section and such sponsor shall be treated as an 

19 eligible employer described in paragraph (1)(A). 

20 ‘‘(B) LENGTH OF SERVICE AWARD

21 PLAN.—For purposes of this paragraph— 

22 ‘‘(i) IN GENERAL.—The term ‘length 

23 of service award plan’ means any plan pay24 ing solely length of service awards to bona 

25 fide volunteers (or their beneficiaries) on 


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1 account of qualified services performed by 

2 such volunteers. 

3 ‘‘(ii) BONA FIDE VOLUNTEER.—An in4 dividual shall be treated as a bona fide vol5 unteer if the only compensation received by 

6 such individual for performing qualified 

7 services is in the form of— 

8 ‘‘(I) reimbursement for (or a rea9 sonable allowance for) reasonable ex10 penses incurred in the performance of 

11 such services, or 

12 ‘‘(II) reasonable benefits (includ13 ing length of service awards), and fees 

14 for such services, customarily paid by 

15 eligible employers in connection with 

16 the performance of such services by 

17 volunteers. 

18 ‘‘(iii) QUALIFIED SERVICES.—The 

19 term ‘qualified services’ means firefighting 

20 and prevention services, emergency medical 

21 services, ambulance services, and emer22 gency rescue services. 

23 ‘‘(C) MAXIMUM DEFERRAL AMOUNT.—In 

24 the case of a length of service award plan whose 

25 sponsor has elected to have such plan treated as 


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1 an eligible deferred compensation plan, sub2 section (b)(2) shall be applied by striking ‘the 

3 lesser of—’ and all that follows and inserting 

4 ‘the applicable dollar amount,’. 

5 ‘‘(D) DISTRIBUTION REQUIREMENTS.—In 

6 the case of a length of service award plan whose 

7 sponsor has elected to have such plan treated as 

8 an eligible deferred compensation plan, sub9 section (d)(1)(A)(ii) shall be applied by deeming 

10 a severance from employment to have occurred 

11 at the later of— 

12 ‘‘(i) the payment date under the terms 

13 of the plan, or 

14 ‘‘(ii) the date on which the plan par15 ticipant ceases to perform qualified serv16 ices. 

17 ‘‘(E) LIMITATION ON ACCRUALS.— 

18 ‘‘(i) IN GENERAL.—In the case of a 

19 length of service award plan that is a de20 fined benefit plan (as defined in section 

21 414(j)) whose sponsor has not elected to 

22 have such plan treated as an eligible de23 ferred compensation plan, such plan shall 

24 be treated as not providing for the deferral 

25 of compensation if the aggregate amount 


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1 of length of service awards accruing with 

2 respect to any year of service for any bona 

3 fide volunteer does not exceed $5,500. In 

4 the case of a length of service award plan 

5 described in the preceding sentence that is 

6 a defined benefit plan (as defined in sec7 tion 414(j)), the limitation on the annual 

8 deferral shall apply to the actuarial present 

9 value of the aggregate amount of length of 

10 service awards accruing with respect to 

11 any year of service. Such actuarial present 

12 value shall be calculated using reasonable 

13 actuarial assumptions and methods assum14 ing payment shall be made under the most 

15 valuable form of payment of the length of 

16 service award under the program with pay17 ment commencing at the later of the ear18 liest age at which unreduced benefits are 

19 payable under the program or the partici20 pant’s current age. 

21 ‘‘(ii) COST-OF-LIVING ADJUSTMENT.— 

22 In the case of taxable years beginning 

23 after December 31, 2015, the Secretary 

24 shall adjust the $5,500 amount under 

25 clause (i) at the same time and in the 


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1 same manner as under section 415(d), ex2 cept that the base period shall be the cal3 endar quarter beginning July 1, 2014, and 

4 any increase under this paragraph that is 

5 not a multiple of $500 shall be rounded to 

6 the next lowest multiple of $500.’’. 

7 (b) CONFORMING AMENDMENTS.— 

8 (1) Section 457(e)(11) of the Internal Revenue 

9 Code of 1986 is amended to read as follows: 

10 ‘‘(11) CERTAIN PLANS EXCLUDED.—Any bona 

11 fide vacation leave, sick leave, compensatory time, 

12 severance pay, disability pay, or death benefit plan 

13 shall be treated as not providing for the deferral of 

14 compensation.’’. 

15 (2) Section 3121(a)(5)(I) of such Code is 

16 amended by striking ‘‘section 457(e)(11)(A)(ii)’’ and 

17 inserting ‘‘section 457(e)(19)’’. 

18 (c) EFFECTIVE DATE.—The amendments made by 

19 this section shall apply to taxable years beginning after 

20 December 31, 2014. 

21 SEC. 3. EXEMPTION OF LENGTH OF SERVICE AWARD PRO22 GRAMS FROM THE EMPLOYEE RETIREMENT 

23 INCOME SECURITY ACT OF 1974. 

24 The Secretary of Labor shall issue guidance clari25 fying that a length of service award program described 


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1 in section 457(e)(19) of the Internal Revenue Code of 

2 1986 is not an employee pension benefit plan under sec3 tion 3(2) of the Employee Retirement Income Security Act 

4 of 1974 (29 U.S.C. 1002(2)). 

Æ 


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