H. R. 7327—16 
(2) inserting ‘‘of such Act’’ after ‘‘section 407(d)(2)’’. 
(d) AMENDMENTS RELATED TO SECTION 624.—Section 404(c)(5) 
of ERISA is amended by striking ‘‘participant’’ each place it appears 
and inserting ‘‘participant or beneficiary’’. 
SEC. 107. AMENDMENTS RELATED TO TITLE VII. 
(a) AMENDMENTS TO ERISA.— 
(1) Section 203(f)(1)(B) of ERISA is amended to read as 
follows: 
‘‘(B) the requirements of section 204(c) or 205(g), or 
the requirements of subsection (e), with respect to accrued 
benefits derived from employer contributions,’’. 
(2) Section 204(b)(5) of ERISA is amended— 
(A) by striking ‘‘clause’’ in subparagraph (A)(iii) and 
inserting ‘‘subparagraph’’, and 
(B) by inserting ‘‘otherwise’’ before ‘‘allowable’’ in 
subparagraph (C). 
(3) Subclause (II) of section 204(b)(5)(B)(i) of ERISA is 
amended to read as follows: 
‘‘(II) 
PRESERVATION
OF
CAPITAL.—An 
applicable defined benefit plan shall be treated 
as failing to meet the requirements of paragraph 
(1)(H) unless the plan provides that an interest 
credit (or equivalent amount) of less than zero 
shall in no event result in the account balance 
or similar amount being less than the aggregate 
amount of contributions credited to the account.’’. 
(b) AMENDMENTS TO 1986 CODE.— 
(1) Section 411(b)(5) of the 1986 Code is amended— 
(A) by striking ‘‘clause’’ in subparagraph (A)(iii) and 
inserting ‘‘subparagraph’’, and 
(B) by inserting ‘‘otherwise’’ before ‘‘allowable’’ in 
subparagraph (C). 
(2) Section 411(a)(13)(A) of the 1986 Code is amended— 
(A) by striking ‘‘paragraph (2)’’ in clause (i) and 
inserting ‘‘subparagraph (B)’’, 
(B) by striking clause (ii) and inserting the following 
new clause: 
‘‘(ii) the requirements of subsection (a)(11) or (c), 
or the requirements of section 417(e), with respect 
to accrued benefits derived from employer contribu-
tions,’’, and 
(C) by striking ‘‘paragraph (3)’’ in the matter following 
clause (ii) and inserting ‘‘subparagraph (C)’’. 
(3) Subclause (II) of section 411(b)(5)(B)(i) of the 1986 Code 
is amended to read as follows: 
‘‘(II) 
PRESERVATION
OF
CAPITAL.—An 
applicable defined benefit plan shall be treated 
as failing to meet the requirements of paragraph 
(1)(H) unless the plan provides that an interest 
credit (or equivalent amount) of less than zero 
shall in no event result in the account balance 
or similar amount being less than the aggregate 
amount of contributions credited to the account.’’. 
(c) AMENDMENTS TO 2006 ACT.— 
(1) Section 701(d)(2) of the 2006 Act is amended by striking 
‘‘204(g)’’ and inserting ‘‘205(g)’’.
H. R. 7327—17 
(2) Section 701(e) of the 2006 Act is amended— 
(A) by inserting ‘‘on or’’ after ‘‘period’’ in paragraph 
(3), 
(B) in paragraph (4)— 
(i) by inserting ‘‘the earlier of’’ after ‘‘before’’ in 
the matter preceding subparagraph (A), and 
(ii) by striking ‘‘earlier’’ and inserting ‘‘later’’ in 
subparagraph (A), 
(C) by inserting ‘‘on or’’ before ‘‘after’’ each place it 
appears in paragraph (5), and 
(D) by adding at the end the following new paragraph: 
‘‘(6) SPECIAL
RULE
FOR
VESTING
REQUIREMENTS.—The 
requirements of section 203(f)(2) of the Employee Retirement 
Income Security Act of 1974 and section 411(a)(13)(B) of the 
Internal Revenue Code of 1986 (as added by this Act)— 
‘‘(A) shall not apply to a participant who does not 
have an hour of service after the effective date of such 
requirements (as otherwise determined under this sub-
section); and 
‘‘(B) in the case of a plan other than a plan described 
in paragraph (3) or (4), shall apply to plan years ending 
on or after June 29, 2005.’’. 
SEC. 108. AMENDMENTS RELATED TO TITLE VIII. 
(a) AMENDMENTS RELATED TO SECTION 801.— 
(1) Section 404(o) of the 1986 Code is amended— 
(A) by striking ‘‘430(g)(2)’’ in paragraph (2)(A)(ii) and 
inserting ‘‘430(g)(3)’’, and 
(B) by striking ‘‘412(f)(4)’’ in paragraph (4)(B) and 
inserting ‘‘412(d)(3)’’. 
(2) Section 404(a)(7)(A) of the 1986 Code is amended— 
(A) by striking the next to last sentence, and 
(B) by striking ‘‘the plan’s funding shortfall determined 
under section 430’’ in the last sentence and inserting ‘‘the 
excess (if any) of the plan’s funding target (as defined 
in section 430(d)(1)) over the value of the plan’s assets 
(as determined under section 430(g)(3))’’. 
(b) 
AMENDMENT
RELATED
TO
SECTION
802.—Section 
404(a)(1)(D)(i) of the 1986 Code is amended by striking ‘‘431(c)(6)(C)’’ 
and inserting ‘‘431(c)(6)(D)’’. 
(c) AMENDMENT RELATED TO SECTION 803.—Clause (iii) of sec-
tion 404(a)(7)(C) of the 1986 Code is amended to read as follows: 
‘‘(iii) LIMITATION.—In the case of employer con-
tributions to 1 or more defined contribution plans— 
‘‘(I) if such contributions do not exceed 6 per-
cent of the compensation otherwise paid or accrued 
during the taxable year to the beneficiaries under 
such plans, this paragraph shall not apply to such 
contributions or to employer contributions to the 
defined benefit plans to which this paragraph 
would otherwise apply by reason of contributions 
to the defined contribution plans, and 
‘‘(II) if such contributions exceed 6 percent 
of such compensation, this paragraph shall be 
applied by only taking into account such contribu-
tions to the extent of such excess.
H. R. 7327—18 
For purposes of this clause, amounts carried over from 
preceding taxable years under subparagraph (B) shall 
be treated as employer contributions to 1 or more 
defined contributions plans to the extent attributable 
to employer contributions to such plans in such pre-
ceding taxable years.’’. 
(d) AMENDMENTS RELATED TO SECTION 824.— 
(1) Section 408A(c)(3)(B) of the 1986 Code, as in effect 
after the amendments made by section 824(b)(1) of the 2006 
Act, is amended— 
(A) by striking the second ‘‘an’’ before ‘‘eligible’’, 
(B) by striking ‘‘other than a Roth IRA’’, and 
(C) by adding at the end the following new flush sen-
tence: 
‘‘This subparagraph shall not apply to a qualified rollover 
contribution from a Roth IRA or to a qualified rollover 
contribution from a designated Roth account which is a 
rollover contribution described in section 402A(c)(3)(A).’’ 
(2) Section 408A(d)(3)(B), as in effect after the amendments 
made by section 824(b)(2)(B) of the 2006 Act, is amended by 
striking ‘‘(other than a Roth IRA)’’ and by inserting at the 
end the following new sentence: ‘‘This paragraph shall not 
apply to a distribution which is a qualified rollover contribution 
from a Roth IRA or a qualified rollover contribution from a 
designated Roth account which is a rollover contribution 
described in section 402A(c)(3)(A)’’. 
(e) AMENDMENT TO SECTION 827.—The first sentence of section 
72(t)(2)(G)(iv) of the 1986 Code is amended by inserting ‘‘on or’’ 
before ‘‘before’’. 
(f) AMENDMENTS RELATED TO SECTION 829.— 
(1) Section 402(c)(11) of the 1986 Code is amended— 
(A) by inserting ‘‘described in paragraph (8)(B)(iii)’’ 
after ‘‘eligible retirement plan’’ in subparagraph (A), and 
(B) by striking ‘‘trust’’ before ‘‘designated beneficiary’’ 
in subparagraph (B). 
(2)(A) Section 402(f)(2)(A) of the 1986 Code is amended 
by adding at the end the following new sentence: ‘‘Such term 
shall include any distribution to a designated beneficiary which 
would be treated as an eligible rollover distribution by reason 
of subsection (c)(11), or section 403(a)(4)(B), 403(b)(8)(B), or 
457(e)(16)(B), if the requirements of subsection (c)(11) were 
satisfied.’’ 
(B) Clause (i) of section 402(c)(11)(A) of the 1986 Code 
is amended by striking ‘‘for purposes of this subsection’’. 
(C) The amendments made by this paragraph shall apply 
with respect to plan years beginning after December 31, 2009. 
(g) AMENDMENT RELATED TO SECTION 832.—Section 415(f) of 
the 1986 Code is amended by striking paragraph (2) and by redesig-
nating paragraph (3) as paragraph (2). 
(h) AMENDMENTS RELATED TO SECTION 833.— 
(1) Section 408A(c)(3)(C) of the 1986 Code, as added by 
section 833(c) of the 2006 Act, is redesignated as subparagraph 
(E). 
(2) In the case of taxable years beginning after December 
31, 2009, section 408A(c)(3)(E) of the 1986 Code (as redesig-
nated by paragraph (1))— 
(A) is redesignated as subparagraph (D), and
H. R. 7327—19 
(B) is amended by striking ‘‘subparagraph (C)(ii)’’ and 
inserting ‘‘subparagraph (B)(ii)’’. 
(i) AMENDMENTS RELATED TO SECTION 841.— 
(1) Section 420(c)(1)(A) of the 1986 Code is amended by 
adding at the end the following new sentence: ‘‘In the case 
of a qualified future transfer or collectively bargained transfer 
to which subsection (f) applies, any assets so transferred may 
also be used to pay liabilities described in subsection (f)(2)(C).’’ 
(2) Section 420(f)(2) of the 1986 Code is amended by 
striking ‘‘such’’ before ‘‘the applicable’’ in subparagraph (D)(i)(I). 
(3) Section 4980(c)(2)(B) of the 1986 Code is amended by 
striking ‘‘or’’ at the end of clause (i), by striking the period 
at the end of clause (ii) and inserting ‘‘, or’’, and by adding 
at the end the following new clause: 
‘‘(iii) 
any 
transfer 
described 
in 
section 
420(f)(2)(B)(ii)(II).’’. 
(j) AMENDMENTS RELATED TO SECTION 845.— 
(1) Subsection (l) of section 402 of the 1986 Code is 
amended— 
(A) in paragraph (1)— 
(i) by inserting ‘‘maintained by the employer 
described in paragraph (4)(B)’’ after ‘‘an eligible retire-
ment plan’’, and 
(ii) by striking ‘‘of the employee, his spouse, or 
dependents (as defined in section 152)’’ , 
(B) in paragraph (4)(D), by— 
(i) inserting ‘‘(as defined in section 152)’’ after 
‘‘dependents’’, and 
(ii) striking ‘‘health insurance plan’’ and inserting 
‘‘health plan’’, and 
(C) in paragraph (5)(A), by striking ‘‘health insurance 
plan’’ and inserting ‘‘health plan’’. 
(2) Subparagraph (B) of section 402(l)(3) of the 1986 Code 
is amended by striking ‘‘all amounts distributed from all eligible 
retirement plans were treated as 1 contract for purposes of 
determining the inclusion of such distribution under section 
72’’ and inserting ‘‘all amounts to the credit of the eligible 
public safety officer in all eligible retirement plans maintained 
by the employer described in paragraph (4)(B) were distributed 
during such taxable year and all such plans were treated as 
1 contract for purposes of determining under section 72 the 
aggregate amount which would have been so includible’’. 
(k) AMENDMENTS RELATED TO SECTION 854.— 
(1) Section 3121(b)(5)(E) of the 1986 Code is amended by 
striking ‘‘or special trial judge’’. 
(2) Section 210(a)(5)(E) of the Social Security Act is 
amended by striking ‘‘or special trial judge’’. 
(l) AMENDMENTS RELATED
TO SECTION 856.—Section 856 of 
the 2006 Act, and the amendments made by such section, are 
hereby repealed, and the Internal Revenue Code of 1986 shall 
be applied and administered as if such sections and amendments 
had not been enacted. 
(m) AMENDMENT RELATED
TO SECTION 864.—Section 864(a) 
of the 2006 Act is amended by striking ‘‘Reconciliation’’.
H. R. 7327—20 
SEC. 109. AMENDMENTS RELATED TO TITLE IX. 
(a) 
AMENDMENT
RELATED
TO
SECTION
901.—Section 
401(a)(35)(E)(iv) of the 1986 Code is amended to read as follows: 
‘‘(iv) ONE-PARTICIPANT
RETIREMENT
PLAN.—For 
purposes of clause (iii), the term ‘one-participant retire-
ment plan’ means a retirement plan that on the first 
day of the plan year— 
‘‘(I) covered only one individual (or the indi-
vidual and the individual’s spouse) and the indi-
vidual (or the individual and the individual’s 
spouse) owned 100 percent of the plan sponsor 
(whether or not incorporated), or 
‘‘(II) covered only one or more partners (or 
partners and their spouses) in the plan sponsor.’’. 
(b) AMENDMENTS RELATED TO SECTION 902.— 
(1) Section 401(k)(13)(D)(i)(I) of the 1986 Code is amended 
by striking ‘‘such compensation as exceeds 1 percent but does 
not’’ and inserting ‘‘such contributions as exceed 1 percent 
but do not’’. 
(2) Sections 401(k)(8)(E) and 411(a)(3)(G) of the 1986 Code 
are each amended— 
(A) by striking ‘‘an erroneous automatic contribution’’ 
and inserting ‘‘a permissible withdrawal’’, and 
(B) by striking ‘‘ERRONEOUS AUTOMATIC CONTRIBUTION’’ 
in the heading and inserting ‘‘PERMISSIBLE WITHDRAWAL’’. 
(3) Section 402(g)(2)(A)(ii) of the 1986 Code is amended 
by inserting ‘‘through the end of such taxable year’’ after ‘‘such 
amount’’. 
(4) Section 414(w)(3) of the 1986 Code is amended— 
(A) in subparagraph (B), by inserting ‘‘and’’ after the 
comma at the end, 
(B) by striking subparagraph (C), and 
(C) by redesignating subparagraph (D) as subpara-
graph (C). 
(5) Section 414(w)(5) of the 1986 Code is amended by 
striking ‘‘and’’ at the end of subparagraph (B), by striking 
the period at the end of subparagraph (C) and inserting a 
comma, and by adding at the end the following: 
‘‘(D) a simplified employee pension the terms of which 
provide for a salary reduction arrangement described in 
section 408(k)(6), and 
‘‘(E) a simple retirement account (as defined in section 
408(p)).’’. 
(6) Section 414(w)(6) of the 1986 Code is amended by 
inserting ‘‘or for purposes of applying the limitation under 
section 402(g)(1)’’ before the period at the end. 
(c) AMENDMENTS RELATED TO SECTION 903.— 
(1) AMENDMENT OF 1986 CODE.—Section 414(x)(1) of the 
1986 Code is amended by adding at the end of paragraph 
(1) the following new sentence: ‘‘In the case of a termination 
of the defined benefit plan and the applicable defined contribu-
tion plan forming part of an eligible combined plan, the plan 
administrator shall terminate each such plan separately.’’ 
(2) AMENDMENTS OF ERISA.—Section 210(e) of ERISA is 
amended— 
(A) by adding at the end of paragraph (1) the following 
new sentence: ‘‘In the case of a termination of the defined
H. R. 7327—21 
benefit plan and the applicable defined contribution plan 
forming part of an eligible combined plan, the plan adminis-
trator shall terminate each such plan separately.’’, and 
(B) by striking paragraph (3) and by redesignating 
paragraphs (4), (5), and (6) as paragraphs (3), (4), and 
(5), respectively. 
(d) AMENDMENTS RELATED TO SECTION 906.— 
(1) Section 906(b)(1)(B)(ii) of the 2006 Act is amended by 
striking ‘‘paragraph (1)’’ and inserting ‘‘paragraph (10)’’. 
(2) Section 4021(b) of ERISA is amended by inserting ‘‘or’’ 
at the end of paragraph (12), by striking ‘‘; or’’ at the end 
of paragraph (13) and inserting a period, and by striking para-
graph (14). 
SEC. 110. AMENDMENTS RELATED TO TITLE X. 
(a) AMENDMENTS TO RAILROAD RETIREMENT ACT.— 
(1) Section 14(b) of the Railroad Retirement Act of 1974 
(45 U.S.C. 231m(b)) is amended by adding at the end the 
following: 
‘‘(3)(A) Payments made pursuant to paragraph (2) of this 
subsection shall not require that the employee be entitled to 
an annuity under section 2(a)(1) of this Act: Provided, however, 
That where an employee is not entitled to such an annuity, 
payments made pursuant to paragraph (2) may not begin before 
the month in which the following three conditions are satisfied: 
‘‘(i) The employee has completed ten years of service 
in the railroad industry or, five years of service all of 
which accrues after December 31, 1995. 
‘‘(ii) The spouse or former spouse attains age 62. 
‘‘(iii) The employee attains age 62 (or if deceased, would 
have attained age 62). 
‘‘(B) Payments made pursuant to paragraph (2) of this 
subsection shall terminate upon the death of the spouse or 
former spouse, unless the court document provides for termi-
nation at an earlier date. Notwithstanding the language in 
a court order, that portion of payments made pursuant to 
paragraph (2) which represents payments computed pursuant 
to section 3(f)(2) of this Act shall not be paid after the death 
of the employee. 
‘‘(C) If the employee is not entitled to an annuity under 
section 2(a)(1) of this Act, payments made pursuant to para-
graph (2) of this subsection shall be computed as though the 
employee were entitled to an annuity.’’. 
(2) Subsection (d) of section 5 of the Railroad Retirement 
Act (45 U.S.C. 231d) is repealed. 
(b) EFFECTIVE DATES.— 
(1) SUBSECTION (a)(1).—The amendment made by sub-
section (a)(1) shall apply with respect to payments due for 
months after August 2007. If, prior to the effective date of 
such amendment, payment pursuant to paragraph (2) of section 
14(b) of the Railroad Retirement Act of 1974 (45 U.S.C. 
231m(b)) was terminated because of the employee’s death, pay-
ment to the former spouse may be reinstated for months after 
August 2007. 
(2) SUBSECTION (a)(2).—The amendment made by sub-
section (a)(2) shall take effect upon the date of the enactment 
of this Act.
H. R. 7327—22 
SEC. 111. AMENDMENTS RELATED TO TITLE XI. 
(a) AMENDMENT RELATED TO SECTION 1104.—Section 1104(d)(1) 
of the 2006 Act is amended by striking ‘‘Act’’ the first place it 
appears and inserting ‘‘section’’. 
(b) AMENDMENTS RELATED TO SECTION 1105.—Section 3304(a) 
of the 1986 Code is amended— 
(1) in paragraph (15)— 
(A) by redesignating clauses (i) and (ii) of subparagraph 
(A) as subclauses (I) and (II), 
(B) by redesignating subparagraphs (A) and (B) as 
clauses (i) and (ii), 
(C) by striking the semicolon at the end of clause 
(ii) (as so redesignated) and inserting ‘‘, and’’, 
(D) by striking ‘‘(15)’’ and inserting ‘‘(15)(A) subject 
to subparagraph (B),’’, and 
(E) by adding at the end the following: 
‘‘(B) the amount of compensation shall not be reduced 
on account of any payments of governmental or other pen-
sions, retirement or retired pay, annuity, or other similar 
payments which are not includible in the gross income 
of the individual for the taxable year in which it was 
paid because it was part of a rollover distribution;’’, and 
(2) by striking the last sentence. 
(c) AMENDMENTS RELATED TO SECTION 1106.—Section 3(37)(G) 
of ERISA is amended by— 
(1) striking ‘‘paragraph’’ each place it appears in clauses 
(ii), (iii), and (v)(I) and inserting ‘‘subparagraph’’, 
(2) striking ‘‘subclause (i)(II)’’ in clause (iii) and inserting 
‘‘clause (i)(II)’’, 
(3) striking ‘‘subparagraph’’ in clause (v)(II) and inserting 
‘‘clause’’, and 
(4) by striking ‘‘section 101(b)(4)’’ in clause (v)(III) and 
inserting ‘‘section 101(b)(1)’’. 
SEC. 112. EFFECTIVE DATE. 
Except as otherwise provided in this subtitle, the amendments 
made by this subtitle shall take effect as if included in the provisions 
of the 2006 Act to which the amendments relate. 
Subtitle B—Other Provisions 
SEC. 121. AMENDMENTS RELATED TO SECTIONS 102 AND 112 OF THE 
PENSION PROTECTION ACT OF 2006. 
(a) AMENDMENT
OF ERISA.—The last sentence of section 
303(g)(3)(B) of ERISA is amended to read as follows: ‘‘Any such 
averaging shall be adjusted for contributions, distributions, and 
expected earnings (as determined by the plan’s actuary on the 
basis of an assumed earnings rate specified by the actuary but 
not in excess of the third segment rate applicable under subsection 
(h)(2)(C)(iii)), as specified by the Secretary of the Treasury.’’. 
(b) AMENDMENT OF 1986 CODE.—The last sentence of section 
430(g)(3)(B) of the 1986 Code is amended to read as follows: ‘‘Any 
such averaging shall be adjusted for contributions, distributions, 
and expected earnings (as determined by the plan’s actuary on 
the basis of an assumed earnings rate specified by the actuary
H. R. 7327—23 
but not in excess of the third segment rate applicable under sub-
section (h)(2)(C)(iii)), as specified by the Secretary.’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall take effect as if included in the provisions of the 2006 Act 
to which the amendments relate. 
SEC. 122. MODIFICATION OF INTEREST RATE ASSUMPTION REQUIRED 
WITH RESPECT TO CERTAIN SMALL EMPLOYER PLANS. 
(a) IN GENERAL.—Subparagraph (E) of section 415(b)(2) of the 
1986 Code (relating to limitation on certain assumptions) is 
amended by adding at the end the following new clause: 
‘‘(vi) In the case of a plan maintained by an eligible 
employer (as defined in section 408(p)(2)(C)(i)), clause 
(ii) shall be applied without regard to subclause (II) 
thereof.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to years beginning after December 31, 2008. 
SEC. 123. DETERMINATION OF MARKET RATE OF RETURN FOR 
GOVERNMENTAL PLANS. 
(a) AMENDMENT OF ADEA.—Section 4(i)(10)(B)(i)(III) of the Age 
Discrimination 
in 
Employment 
Act 
of 
1967 
(29 
U.S.C. 
623(i)(10)(B)(i)(III)) is amended by adding at the end the following: 
‘‘In the case of a governmental plan (as defined in the first sentence 
of section 414(d) of the Internal Revenue Code of 1986), a rate 
of return or a method of crediting interest established pursuant 
to any provision of Federal, State, or local law (including any 
administrative rule or policy adopted in accordance with any such 
law) shall be treated as a market rate of return for purposes 
of subclause (I) and a permissible method of crediting interest 
for purposes of meeting the requirements of subclause (I), except 
that this sentence shall only apply to a rate of return or method 
of crediting interest if such rate or method does not violate any 
other requirement of this Act.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall take effect as if included in the provisions of the Pension 
Protection Act of 2006 to which such amendment relates. 
SEC. 124. TREATMENT OF CERTAIN REIMBURSEMENTS FROM GOVERN-
MENTAL PLANS FOR MEDICAL CARE. 
(a) IN GENERAL.—Section 105 of the 1986 Code (relating to 
amounts received under accident and health plans) is amended 
by adding at the end the following new subsection: 
‘‘(j) SPECIAL RULE FOR CERTAIN GOVERNMENTAL PLANS.— 
‘‘(1) IN GENERAL.—For purposes of subsection (b), amounts 
paid (directly or indirectly) to the taxpayer from an accident 
or health plan described in paragraph (2) shall not fail to 
be excluded from gross income solely because such plan, on 
or before January 1, 2008, provides for reimbursements of 
health care expenses of a deceased plan participant’s bene-
ficiary. 
‘‘(2) PLAN
DESCRIBED.—An accident or health plan is 
described in this paragraph if such plan is funded by a medical 
trust that is established in connection with a public retirement 
system and that— 
‘‘(A) has been authorized by a State legislature, or
H. R. 7327—24 
‘‘(B) has received a favorable ruling from the Internal 
Revenue Service that the trust’s income is not includible 
in gross income under section 115.’’. 
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 
shall apply to payments before, on, or after the date of the enact-
ment of this Act. 
SEC. 125. ROLLOVER OF AMOUNTS RECEIVED IN AIRLINE CARRIER 
BANKRUPTCY TO ROTH IRAS. 
(a) GENERAL RULE.—If a qualified airline employee receives 
any airline payment amount and transfers any portion of such 
amount to a Roth IRA within 180 days of receipt of such amount 
(or, if later, within 180 days of the date of the enactment of 
this Act), then such amount (to the extent so transferred) shall 
be treated as a qualified rollover contribution described in section 
408A(e) of the Internal Revenue Code of 1986, and the limitations 
described in section 408A(c)(3) of such Code shall not apply to 
any such transfer. 
(b) DEFINITIONS
AND SPECIAL RULES.—For purposes of this 
section— 
(1) AIRLINE PAYMENT AMOUNT.— 
(A) IN GENERAL.—The term ‘‘airline payment amount’’ 
means any payment of any money or other property which 
is payable by a commercial passenger airline carrier to 
a qualified airline employee— 
(i) under the approval of an order of a Federal 
bankruptcy court in a case filed after September 11, 
2001, and before January 1, 2007, and 
(ii) in respect of the qualified airline employee’s 
interest in a bankruptcy claim against the carrier, 
any note of the carrier (or amount paid in lieu of 
a note being issued), or any other fixed obligation 
of the carrier to pay a lump sum amount. 
The amount of such payment shall be determined without 
regard to any requirement to deduct and withhold tax 
from such payment under sections 3102(a) and 3402(a). 
(B) EXCEPTION.—An airline payment amount shall not 
include any amount payable on the basis of the carrier’s 
future earnings or profits. 
(2) QUALIFIED AIRLINE EMPLOYEE.—The term ‘‘qualified air-
line employee’’ means an employee or former employee of a 
commercial passenger airline carrier who was a participant 
in a defined benefit plan maintained by the carrier which— 
(A) is a plan described in section 401(a) of the Internal 
Revenue Code of 1986 which includes a trust exempt from 
tax under section 501(a) of such Code, and 
(B) was terminated or became subject to the restric-
tions contained in paragraphs (2) and (3) of section 402(b) 
of the Pension Protection Act of 2006. 
(3) REPORTING REQUIREMENTS.—If a commercial passenger 
airline carrier pays 1 or more airline payment amounts, the 
carrier shall, within 90 days of such payment (or, if later, 
within 90 days of the date of the enactment of this Act), 
report— 
(A) to the Secretary of the Treasury, the names of 
the qualified airline employees to whom such amounts 
were paid, and
H. R. 7327—25 
(B) to the Secretary and to such employees, the years 
and the amounts of the payments. 
Such reports shall be in such form, and contain such additional 
information, as the Secretary may prescribe. 
(c) EFFECTIVE DATE.—This section shall apply to transfers made 
after the date of the enactment of this Act with respect to airline 
payment amounts paid before, on, or after such date. 
SEC. 126. DETERMINATION OF ASSET VALUE FOR SPECIAL AIRLINE 
FUNDING RULES. 
(a) IN GENERAL.—Section 402(e)(4)(C) of the 2006 Act is 
amended to read as follows: 
‘‘(C) the value of plan assets shall be determined under 
sections 303(g)(3) of such Act and 430(g)(3) of such Code.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to plan years beginning after December 31, 2007. 
SEC. 127. MODIFICATION OF PENALTY FOR FAILURE TO FILE PART-
NERSHIP RETURNS. 
(a) IN GENERAL.—Section 6698(b)(1) of the 1986 Code is 
amended by striking ‘‘$85’’ and inserting ‘‘$89’’. 
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 
shall apply to returns required to be filed after December 31, 
2008. 
SEC. 128. MODIFICATION OF PENALTY FOR FAILURE TO FILE S COR-
PORATION RETURNS. 
(a) IN GENERAL.—Section 6699(b)(1) of the 1986 Code is 
amended by striking ‘‘$85’’ and inserting ‘‘$89’’. 
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 
shall apply to returns required to be filed after December 31, 
2008. 
TITLE II—PENSION PROVISIONS 
RELATING TO ECONOMIC CRISIS 
SEC. 201. TEMPORARY WAIVER OF REQUIRED MINIMUM DISTRIBUTION 
RULES FOR CERTAIN RETIREMENT PLANS AND ACCOUNTS. 
(a) IN GENERAL.—Section 401(a)(9) of the Internal Revenue 
Code of 1986 (relating to required distributions) is amended by 
adding at the end the following new subparagraph: 
‘‘(H) TEMPORARY WAIVER OF MINIMUM REQUIRED DIS-
TRIBUTION.— 
‘‘(i) IN GENERAL.—The requirements of this para-
graph shall not apply for calendar year 2009 to— 
‘‘(I) a defined contribution plan which is 
described in this subsection or in section 403(a) 
or 403(b), 
‘‘(II) a defined contribution plan which is an 
eligible deferred compensation plan described in 
section 457(b) but only if such plan is maintained 
by an employer described in section 457(e)(1)(A), 
or 
‘‘(III) an individual retirement plan. 
‘‘(ii) SPECIAL RULES REGARDING WAIVER PERIOD.— 
For purposes of this paragraph—
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‘‘(I) the required beginning date with respect 
to any individual shall be determined without 
regard to this subparagraph for purposes of 
applying this paragraph for calendar years after 
2009, and 
‘‘(II) if clause (ii) of subparagraph (B) applies, 
the 5-year period described in such clause shall 
be determined without regard to calendar year 
2009.’’. 
(b) ELIGIBLE ROLLOVER DISTRIBUTIONS.—Section 402(c)(4) of 
the Internal Revenue Code of 1986 (defining eligible rollover dis-
tribution) is amended by adding at the end the following new 
flush sentence: 
‘‘If all or any portion of a distribution during 2009 is treated 
as an eligible rollover distribution but would not be so treated 
if the minimum distribution requirements under section 
401(a)(9) had applied during 2009, such distribution shall not 
be treated as an eligible rollover distribution for purposes of 
section 401(a)(31) or 3405(c) or subsection (f) of this section.’’. 
(c) EFFECTIVE DATES.— 
(1) IN GENERAL.—The amendments made by this section 
shall apply for calendar years beginning after December 31, 
2008. 
(2) PROVISIONS RELATING TO PLAN OR CONTRACT AMEND-
MENTS.— 
(A) IN GENERAL.—If this paragraph applies to any pen-
sion plan or contract amendment, such pension plan or 
contract shall not fail to be treated as being operated 
in accordance with the terms of the plan during the period 
described in subparagraph (B)(ii) solely because the plan 
operates in accordance with this section. 
(B) AMENDMENTS TO WHICH PARAGRAPH APPLIES.— 
(i) IN GENERAL.—This paragraph shall apply to 
any amendment to any pension plan or annuity con-
tract which— 
(I) is made pursuant to the amendments made 
by this section, and 
(II) is made on or before the last day of the 
first plan year beginning on or after January 1, 
2011. 
In the case of a governmental plan, subclause (II) 
shall be applied by substituting ‘‘2012’’ for ‘‘2011’’. 
(ii) CONDITIONS.—This paragraph shall not apply 
to any amendment unless during the period beginning 
on the effective date of the amendment and ending 
on December 31, 2009, the plan or contract is operated 
as if such plan or contract amendment were in effect. 
SEC. 202. TRANSITION RULE CLARIFICATION. 
(a) AMENDMENT
TO
ERISA.—Subparagraph (B) of section 
303(c)(5) of the Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1083(c)(5)) is amended— 
(1) by striking clause (iii) and redesignating clause (iv) 
as clause (iii); and 
(2) by striking clause (i) and inserting the following: 
‘‘(i) IN
GENERAL.—Except as provided in clause 
(iii), in the case of plan years beginning after 2007
H. R. 7327—27 
and before 2011, only the applicable percentage of the 
funding target shall be taken into account under para-
graph (3)(A) in determining the funding shortfall for 
purposes of paragraph (3)(A) and subparagraph (A).’’. 
(b) AMENDMENT TO 1986 CODE.—Subparagraph (B) of section 
430(c)(5) of the Internal Revenue Code of 1986 is amended— 
(1) by striking clause (iii) and redesignating clause (iv) 
as clause (iii); and 
(2) by striking clause (i) and inserting the following: 
‘‘(i) IN
GENERAL.—Except as provided in clause 
(iii), in the case of plan years beginning after 2007 
and before 2011, only the applicable percentage of the 
funding target shall be taken into account under para-
graph (3)(A) in determining the funding shortfall for 
purposes of paragraph (3)(A) and subparagraph (A).’’. 
(c) EFFECTIVE DATE.—The amendments made by subsections 
(a) and (b) shall apply as if included in the enactment of sections 
102 and 112, respectively, of the Pension Protection Act of 2006. 
SEC. 203. TEMPORARY MODIFICATION OF APPLICATION OF LIMITA-
TION ON BENEFIT ACCRUALS. 
In the case of the first plan year beginning during the period 
beginning on October 1, 2008, and ending on September 30, 2009, 
sections 206(g)(4)(A) of the Employee Retirement Income Security 
Act of 1974 (29 U.S.C. 1056(g)(4)(A)) and 436(e)(1) of the Internal 
Revenue Code of 1986 shall be applied by substituting the plan’s 
adjusted funding target attainment percentage for the preceding 
plan year for such percentage for such plan year but only if the 
adjusted funding target attainment percentage for the preceding 
plan year is greater. 
SEC. 204. TEMPORARY DELAY OF DESIGNATION OF MULTIEMPLOYER 
PLANS AS IN ENDANGERED OR CRITICAL STATUS. 
(a) IN GENERAL.—Notwithstanding the actuarial certification 
under section 305(b)(3) of the Employee Retirement Income Security 
Act of 1974 and section 432(b)(3) of the Internal Revenue Code 
of 1986, if a plan sponsor of a multiemployer plan elects the applica-
tion of this section, then, for purposes of section 305 of such Act 
and section 432 of such Code— 
(1) the status of the plan for its first plan year beginning 
during the period beginning on October 1, 2008, and ending 
on September 30, 2009, shall be the same as the status of 
such plan under such sections for the plan year preceding 
such plan year, and 
(2) in the case of a plan which was in endangered or 
critical status for the preceding plan year described in para-
graph (1), the plan shall not be required to update its plan 
or schedules under section 305(c)(6) of such Act and section 
432(c)(6) of such Code, or section 305(e)(3)(B) of such Act and 
section 432(e)(3)(B) of such Code, whichever is applicable, until 
the plan year following the first plan year described in para-
graph (1). 
If section 305 of the Employee Retirement Income Security Act 
of 1974 and section 432 of the Internal Revenue Code of 1986 
did not apply to the preceding plan year described in paragraph 
(1), the plan actuary shall make a certification of the status of 
the plan under section 305(b)(3) of such Act and section 432(b)(3)
H. R. 7327—28 
of such Code for the preceding plan year in the same manner 
as if such sections had applied to such preceding plan year. 
(b) EXCEPTION FOR PLANS BECOMING CRITICAL DURING ELEC-
TION.—If— 
(1) an election was made under subsection (a) with respect 
to a multiemployer plan, and 
(2) such plan has, without regard to such election, been 
certified by the plan actuary under section 305(b)(3) of such 
Act and section 432(b)(3) of such Code to be in critical status 
for the first plan year described in subsection (a)(1), 
then such plan shall be treated as a plan in critical status for 
such plan year for purposes of applying section 4971(g)(1)(A) of 
such Code, section 302(b)(3) of such Act (without regard to the 
second sentence thereof), and section 412(b)(3) of such Code (without 
regard to the second sentence thereof). 
(c) ELECTION AND NOTICE.— 
(1) ELECTION.—An election under subsection (a) shall— 
(A) be made at such time and in such manner as 
the Secretary of the Treasury or the Secretary’s delegate 
may prescribe and, once made, may be revoked only with 
the consent of the Secretary, and 
(B) if the election is made— 
(i) before the date the annual certification is sub-
mitted to the Secretary or the Secretary’s delegate 
under section 305(b)(3) of such Act and section 
432(b)(3) of such Code, be included with such annual 
certification, and 
(ii) after such date, be submitted to the Secretary 
or the Secretary’s delegate not later than 30 days 
after the date of the election. 
(2) NOTICE TO PARTICIPANTS.— 
(A) IN GENERAL.—Notwithstanding section 305(b)(3)(D) 
of such Act and section 431(b)(3)(D) of such Code, if the 
plan is neither in endangered nor critical status by reason 
of an election made under subsection (a)— 
(i) the plan sponsor of a multiemployer plan shall 
not be required to provide notice under such sections, 
and 
(ii) the plan sponsor shall provide to the partici-
pants and beneficiaries, the bargaining parties, the 
Pension Benefit Guaranty Corporation, and the Sec-
retary of Labor a notice of the election and such other 
information as the Secretary of the Treasury (in con-
sultation with the Secretary of Labor) may require— 
(I) if the election is made before the date the 
annual certification is submitted to the Secretary 
or the Secretary’s delegate under section 305(b)(3) 
of such Act and section 432(b)(3) of such Code, 
not later than 30 days after the date of the certifi-
cation, and 
(II) if the election is made after such date, 
not later than 30 days after the date of the election. 
(B) NOTICE OF ENDANGERED STATUS.—Notwithstanding 
section 305(b)(3)(D) of such Act and section 431(b)(3)(D) 
of such Code, if the plan is certified to be in critical status 
for any plan year but is in endangered status by reason
H. R. 7327—29 
of an election made under subsection (a), the notice pro-
vided under such sections shall be the notice which would 
have been provided if the plan had been certified to be 
in endangered status. 
SEC. 205. TEMPORARY EXTENSION OF THE FUNDING IMPROVEMENT 
AND REHABILITATION PERIODS FOR MULTIEMPLOYER 
PENSION PLANS IN CRITICAL AND ENDANGERED STATUS 
FOR 2008 OR 2009. 
(a) IN GENERAL.—If the plan sponsor of a multiemployer plan 
which is in endangered or critical status for a plan year beginning 
in 2008 or 2009 (determined after application of section 204) elects 
the application of this section, then, for purposes of section 305 
of the Employee Retirement Income Security Act of 1974 and section 
432 of the Internal Revenue Code of 1986— 
(1) except as provided in paragraph (2), the plan’s funding 
improvement period or rehabilitation period, whichever is 
applicable, shall be 13 years rather than 10 years, and 
(2) in the case of a plan in seriously endangered status, 
the plan’s funding improvement period shall be 18 years rather 
than 15 years. 
(b) DEFINITIONS
AND SPECIAL RULES.—For purposes of this 
section— 
(1) ELECTION.—An election under this section shall be made 
at such time, and in such manner and form, as (in consultation 
with the Secretary of Labor) the Secretary of the Treasury 
or the Secretary’s delegate may prescribe. 
(2) DEFINITIONS.—Any term which is used in this section 
which is also used in section 305 of the Employee Retirement 
Income Security Act of 1974 and section 432 of the Internal 
Revenue Code of 1986 shall have the same meaning as when 
used in such sections. 
(c) EFFECTIVE DATE.—This section shall apply to plan years 
beginning after December 31, 2007. 
Speaker of the House of Representatives. 
Vice President of the United States and
President of the Senate.