SEC. 2. SUSPENSION OF REQUIRED BEGINNING DATE FOR 
DISTRIBUTIONS FROM DEFINED CONTRIBU-
TION PLANS. 
(a) IN GENERAL.—In the case of a defined contribu-
tion plan— 
(1) section 401(a)(9) of the Internal Revenue 
Code of 1986 shall not apply during the suspension 
period, 
(2) in lieu of the calendar year specified in sub-
paragraph (C)(i) of section 401(a)(9) of such Code, 
the calendar year specified in such subparagraph 
shall be the later of— 
(A) the calendar year described in such 
subparagraph (C)(i), or 
(B) calendar year 2010, and 
(3) the suspension period shall not be taken 
into account for purposes of applying any time limi-
tation in such section 401(a)(9). 
(b) SUSPENSION PERIOD.—For purposes of this sec-
tion, the term ‘‘suspension period’’ means the period be-
ginning on January 1, 2008, and ending on December 31, 
2009. 
(c) APPLICATION TO CERTAIN OTHER PLANS.—The 
following sections shall be applied for the suspension pe-
riod under rules similar to the rules of subsection (a) of 
this section— 
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(1) in the case of a defined contribution plan, 
subsections (a) and (b) of section 403, and sections 
408 and 408A, of such Code, and 
(2) in the case of an eligible deferred compensa-
tion plan described in section 457(b) of such Code 
which is maintained by an eligible employer de-
scribed in section 457(e)(1)(A) of such Code, section 
457 of such Code. 
(d) APPLICATION
TO
CERTAIN
PERIODIC
PAY-
MENTS.—For purposes of this section, in the case of a 
defined contribution plan, the failure to make a payment 
from a qualified retirement plan during the suspension pe-
riod in an amount less than would be required under the 
applicable method shall not be treated as a modification 
for purposes of section 72(t)(2)(A)(iv) of such Code. 
(e) PROVISIONS
RELATING
TO
PLAN
AMEND-
MENTS.— 
(1) IN GENERAL.—If this section applies to any 
plan or annuity contract, such plan or contract shall 
be treated as being operated in accordance with the 
terms of the plan during the period described in 
paragraph (2)(B)(i). 
(2) AMENDMENTS
TO
WHICH
SECTION
AP-
PLIES.— 
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PWALKER on PROD1PC71 with BILLS
(A) IN GENERAL.—This section shall apply 
to any amendment to any plan or annuity con-
tract which is made— 
(i) pursuant to this section or pursu-
ant to any regulation issued by the Sec-
retary of the Treasury to carry out this 
section, and 
(ii) on or before the last day of the 
first plan year beginning on or after Janu-
ary 1, 2009. 
(B) CONDITIONS.—This section shall not 
apply to any amendment unless— 
(i) during the period— 
(I) beginning on the first day of 
the suspension period, and 
(II) ending on the date described 
in subparagraph (A)(ii) (or, if earlier, 
the date the plan or contract amend-
ment is adopted), the plan or contract 
is operated as if such plan or contract 
amendment were in effect, and 
(ii) such plan or contract amendment 
applies retroactively for such period. 
(f) EFFECTIVE DATE.— 
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PWALKER on PROD1PC71 with BILLS
(1) IN GENERAL.—This section shall take effect 
on the date of the enactment of this Act. 
(2) RECONTRIBUTION OF DISTRIBUTIONS BE-
FORE DATE OF ENACTMENT.— 
(A) IN GENERAL.—Any individual who re-
ceives a payment or distribution during the pe-
riod beginning on January 1, 2008, and ending 
on the date of the enactment of this Act from 
a plan to which subsection (a) or (c) of this sec-
tion applies may, before the end of the suspen-
sion period, make one or more contributions in 
an aggregate amount not to exceed the amount 
of such payments or distributions to an eligible 
retirement plan of which such individual is a 
beneficiary and to which a rollover contribution 
of such distribution could be made under sec-
tion 402(c), 403(a)(4), 403(b)(8), 408(d)(3), or 
457(e)(16) of such Code, as the case may be. 
(B) TREATMENT OF REPAYMENTS OF DIS-
TRIBUTIONS
FROM
ELIGIBLE
RETIREMENT 
PLANS
OTHER
THAN
IRAS.—For purposes of 
the Internal Revenue Code of 1986, if a con-
tribution is made pursuant to subparagraph (A) 
to an eligible retirement plan other than an in-
dividual retirement plan, then the taxpayer 
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shall, to the extent of the amount of the con-
tribution, be treated as having received such 
payments or distributions in an eligible rollover 
distribution (as defined in section 402(c)(4) of 
such Code) and as having transferred the 
amount to the eligible retirement plan in a di-
rect trustee to trustee transfer within 60 days 
of the distribution. 
(C) TREATMENT
OF
REPAYMENTS
FOR 
DISTRIBUTIONS FROM IRAS.—For purposes of 
the Internal Revenue Code of 1986, if a con-
tribution is made pursuant to subparagraph (A) 
to an individual retirement plan (as defined by 
section 7701(a)(37) of such Code), then, to the 
extent of the amount of the contribution, such 
payments or distributions shall be treated as a 
distribution described in section 408(d)(3) of 
such Code and as having been transferred to 
the individual retirement plan in a direct trust-
ee to trustee transfer within 60 days of the dis-
tribution. 
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PWALKER on PROD1PC71 with BILLS
SEC. 3. WAIVER OF 10 PERCENT PENALTY ON WITH-
DRAWALS FROM QUALIFIED RETIREMENT 
PLANS DURING 2008 AND 2009 FOR FINANCIAL 
HARDSHIP. 
(a) IN GENERAL.—Paragraph (1) of section 72(t) of 
the Internal Revenue Code of 1986 (relating to imposition 
of additional tax) shall not apply to qualified financial 
hardship distributions from a qualified retirement plan (as 
defined in section 4974(c) of such Code), to an individual. 
Distributions shall not be taken into account under the 
preceding sentence if such distributions are described in 
subparagraph (A), (C), (D), (E), (F), or (G) of section 
72(t)(2) of such Code or to the extent section 72(t)(1) 
of such Code does not apply to such distributions by rea-
son of section 72(t)(2)(B). 
(b) QUALIFIED FORECLOSURE DISTRIBUTIONS.— 
For purposes of subsection (a)— 
(1) IN GENERAL.—The term ‘‘qualified finan-
cial hardship distribution’’ means any payment or 
distribution received after December 31, 2007, and 
before January 1, 2010, by an individual on account 
of financial hardship (as determined by the Sec-
retary of the Treasury). 
(2) LIMITATION.—The amount of payments or 
distributions received by an individual which may be 
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treated as qualified financial hardship distributions 
for any taxable year shall not exceed $15,000. 
(3) AMOUNT DISTRIBUTED MAY BE REPAID.— 
(A) IN GENERAL.—Any individual who re-
ceives a qualified financial hardship distribution 
may, at any time during the 5-year period be-
ginning on the day after the date on which such 
distribution was received, make one or more 
contributions in an aggregate amount not to ex-
ceed the amount of such distribution to an eligi-
ble retirement plan of which such individual is 
a beneficiary and to which a rollover contribu-
tion of such distribution could be made under 
section 402(c), 403(a)(4), 403(b)(8), 408(d)(3), 
or 457(e)(16), as the case may be, of the Inter-
nal Revenue Code of 1986. 
(B) TREATMENT OF REPAYMENTS OF DIS-
TRIBUTIONS
FROM
ELIGIBLE
RETIREMENT 
PLANS
OTHER
THAN
IRAS.—For purposes of 
the Internal Revenue Code of 1986, if a con-
tribution is made pursuant to subparagraph (A) 
with respect to a qualified financial hardship 
distribution from an eligible retirement plan 
other than an individual retirement plan, then 
the taxpayer shall, to the extent of the amount 
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PWALKER on PROD1PC71 with BILLS
of the contribution, be treated as having re-
ceived the qualified financial hardship distribu-
tion in an eligible rollover distribution (as de-
fined in section 402(c)(4) of such Code) and as 
having transferred the amount to the eligible 
retirement plan in a direct trustee to trustee 
transfer within 60 days of the distribution. 
(C) TREATMENT
OF
REPAYMENTS
FOR 
DISTRIBUTIONS FROM IRAS.—For purposes of 
the Internal Revenue Code of 1986, if a con-
tribution is made pursuant to subparagraph (A) 
with respect to a qualified financial hardship 
distribution from an individual retirement plan 
(as defined by section 7701(a)(37) of such 
Code), then, to the extent of the amount of the 
contribution, the qualified financial hardship 
distribution shall be treated as a distribution 
described in section 408(d)(3) of such Code and 
as having been transferred to the eligible retire-
ment plan in a direct trustee to trustee transfer 
within 60 days of the distribution. 
(4) SPECIAL RULES.— 
(A) EXEMPTION OF DISTRIBUTIONS FROM 
TRUSTEE TO TRUSTEE TRANSFER AND WITH-
HOLDING
RULES.—For purposes of sections 
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401(a)(31), 402(f), and 3405 of the Internal 
Revenue Code of 1986, qualified financial hard-
ship distributions shall not be treated as eligible 
rollover distributions. 
(B) QUALIFIED FINANCIAL HARDSHIP DIS-
TRIBUTIONS TREATED AS MEETING PLAN DIS-
TRIBUTION REQUIREMENTS.—For purposes this 
title, a qualified financial hardship distribution 
shall be treated as meeting the requirements of 
sections 
401(k)(2)(B)(i), 
403(b)(7)(A)(ii), 
403(b)(11), and 457(d)(1)(A) of such Code. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act. 
Æ 
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