H. R. 2488—159 
which had 100 or more participants who had accrued a benefit, 
or with respect to whom contributions were made, under the 
plan (whether or not vested) as of the last day of the plan 
year preceding the plan year in which the plan amendment 
becomes effective. Such term shall not include a governmental 
plan (within the meaning of section 414(d)) or a church plan 
(within the meaning of section 414(e)) with respect to which 
the election provided by section 410(d) has not been made.’’. 
(b) AMENDMENT TO ERISA.—Section 204(h) of the Employee 
Retirement Income Security Act or 1974 (29 U.S.C. 1054(h)) is 
amended by adding at the end the following new paragraph: 
‘‘(3)(A) A plan to which paragraph (1) applies shall not be 
treated as meeting the requirements of such paragraph unless, 
in addition to any notice required to be provided to an individual 
or organization under such paragraph, the plan administrator pro-
vides the notice described in subparagraph (B). 
‘‘(B) The notice required by subparagraph (A) shall be written 
in a manner calculated to be understood by the average plan partici-
pant and shall provide sufficient information (as determined in 
accordance with regulations prescribed by the Secretary of the 
Treasury) to allow individuals to understand the effect of the plan 
amendment. 
‘‘(C) Except as provided in regulations prescribed by the Sec-
retary of the Treasury, the notice required by subparagraph (A) 
shall be provided within a reasonable time before the effective 
date of the plan amendment. 
‘‘(D) A plan shall not be treated as failing to meet the require-
ments of subparagraph (A) merely because notice is provided before 
the adoption of the plan amendment if no material modification 
of the amendment occurs before the amendment is adopted.’’. 
(c) CLERICAL AMENDMENT.—The table of sections for chapter 
43 of subtitle D is amended by adding at the end the following 
new item: 
‘‘Sec. 4980F. Failure of applicable plans reducing benefit accruals to satisfy 
notice requirements.’’. 
(d) EFFECTIVE DATES.— 
(1) IN GENERAL.—The amendments made by this section 
shall apply to plan amendments taking effect on or after the 
date of the enactment of this Act. 
(2) TRANSITION.—Until such time as the Secretary of the 
Treasury issues regulations under sections 4980F(e)(2) and (3) 
of the Internal Revenue Code of 1986 and section 204(h)(3) 
of the Employee Retirement Income Security Act of 1974 (as 
added by the amendments made by this section), a plan shall 
be treated as meeting the requirements of such sections if 
it makes a good faith effort to comply with such requirements. 
(3) SPECIAL RULE.—The period for providing any notice 
required by the amendments made by this section shall not 
end before the date which is 3 months after the date of the 
enactment of this Act. 
SEC. 1246. PROTECTION OF INVESTMENT OF EMPLOYEE CONTRIBU-
TIONS TO 401(K) PLANS. 
(a) IN GENERAL.—Section 1524(b) of the Taxpayer Relief Act 
of 1997 is amended to read as follows: 
‘‘(b) EFFECTIVE DATE.— 
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H. R. 2488—160 
‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 
the amendments made by this section shall apply to elective 
deferrals for plan years beginning after December 31, 1998. 
‘‘(2) NONAPPLICATION
TO
PREVIOUSLY
ACQUIRED
PROP-
ERTY.—The amendments made by this section shall not apply 
to any elective deferral which is invested in assets consisting 
of qualifying employer securities, qualifying employer real prop-
erty, or both, if such assets were acquired before January 
1, 1999.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply as if included in the provision of the Taxpayer Relief 
Act of 1997 to which it relates. 
SEC. 1247. TREATMENT OF MULTIEMPLOYER PLANS UNDER SECTION 
415. 
(a) COMPENSATION LIMIT.—Paragraph (11) of section 415(b) 
(relating to limitation for defined benefit plans) is amended to 
read as follows: 
‘‘(11) SPECIAL LIMITATION RULE FOR GOVERNMENTAL AND 
MULTIEMPLOYER PLANS.—In the case of a governmental plan 
(as defined in section 414(d)) or a multiemployer plan (as 
defined in section 414(f )), subparagraph (B) of paragraph (1) 
shall not apply.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to years beginning after December 31, 2000. 
Subtitle E—Reducing Regulatory Burdens 
SEC. 1251. MODIFICATION OF TIMING OF PLAN VALUATIONS. 
(a) IN GENERAL.—Section 412(c)(9) (relating to annual valu-
ation) is amended— 
(1) by striking ‘‘For purposes’’ and inserting the following: 
‘‘(A) IN GENERAL.—For purposes’’, and 
(2) by adding at the end the following: 
‘‘(B) ELECTION TO USE PRIOR YEAR VALUATION.— 
‘‘(i) IN
GENERAL.—Except as provided in clause 
(ii), if, for any plan year— 
‘‘(I) an election is in effect under this subpara-
graph with respect to a plan, and 
‘‘(II) the assets of the plan are not less than 
125 percent of the plan’s current liability (as 
defined in paragraph (7)(B)), determined as of the 
valuation date for the preceding plan year, 
then this section shall be applied using the information 
available as of such valuation date. 
‘‘(ii) EXCEPTIONS.— 
‘‘(I) ACTUAL
VALUATION
EVERY
YEARS.— 
Clause (i) shall not apply for more than 2 consecu-
tive plan years and valuation shall be under 
subparagraph (A) with respect to any plan year 
to which clause (i) does not apply by reason of 
this subclause. 
‘‘(II) REGULATIONS.—Clause (i) shall not apply 
to the extent that more frequent valuations are 
required under the regulations under subpara-
graph (A). 
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H. R. 2488—161 
‘‘(iii) ADJUSTMENTS.—Information under clause (i) 
shall, in accordance with regulations, be actuarially 
adjusted to reflect significant differences in partici-
pants. 
‘‘(iv) ELECTION.—An election under this subpara-
graph, once made, shall be irrevocable without the 
consent of the Secretary.’’. 
(b) AMENDMENTS TO ERISA.—Paragraph (9) of section 302(c) 
of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 
1053(c)) is amended— 
(1) by inserting ‘‘(A)’’ after ‘‘(9)’’, and 
(2) by adding at the end the following: 
‘‘(B)(i) Except as provided in clause (ii), if, for any plan year— 
‘‘(I) an election is in effect under this subparagraph with 
respect to a plan, and 
‘‘(II) the assets of the plan are not less than 125 percent 
of the plan’s current liability (as defined in paragraph (7)(B)), 
determined as of the valuation date for the preceding plan 
year, 
then this section shall be applied using the information available 
as of such valuation date. 
‘‘(ii)(I) Clause (i) shall not apply for more than 2 consecutive 
plan years and valuation shall be under subparagraph (A) with 
respect to any plan year to which clause (i) does not apply by 
reason of this subclause. 
‘‘(II) Clause (i) shall not apply to the extent that more frequent 
valuations are required under the regulations under subparagraph 
(A). 
‘‘(iii) Information under clause (i) shall, in accordance with 
regulations, be actuarially adjusted to reflect significant differences 
in participants. 
‘‘(iv) An election under this subparagraph, once made, shall 
be irrevocable without the consent of the Secretary of the 
Treasury.’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to plan years beginning after December 31, 2000. 
SEC. 1252. ESOP DIVIDENDS MAY BE REINVESTED WITHOUT LOSS OF 
DIVIDEND DEDUCTION. 
(a) IN GENERAL.—Section 404(k)(2)(A) (defining applicable divi-
dends) is amended by striking ‘‘or’’ at the end of clause (ii), by 
redesignating clause (iii) as clause (iv), and by inserting after clause 
(ii) the following new clause: 
‘‘(iii) is, at the election of such participants or 
their beneficiaries— 
‘‘(I) payable as provided in clause (i) or (ii), 
or 
‘‘(II) paid to the plan and reinvested in quali-
fying employer securities, or’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2000. 
SEC. 1253. REPEAL OF TRANSITION RULE RELATING TO CERTAIN 
HIGHLY COMPENSATED EMPLOYEES. 
(a) IN GENERAL.—Paragraph (4) of section 1114(c) of the Tax 
Reform Act of 1986 is hereby repealed. 
(b) EFFECTIVE DATE.—The repeal made by subsection (a) shall 
apply to plan years beginning after December 31, 1999. 
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H. R. 2488—162 
SEC. 1254. EMPLOYEES OF TAX-EXEMPT ENTITIES. 
(a) IN GENERAL.—The Secretary of the Treasury shall modify 
Treasury 
Regulations 
section 
1.410(b)–6(g) 
to 
provide 
that 
employees of an organization described in section 403(b)(1)(A)(i) 
of the Internal Revenue Code of 1986 who are eligible to make 
contributions under section 403(b) of such Code pursuant to a 
salary reduction agreement may be treated as excludable with 
respect to a plan under section 401 (k) or (m) of such Code that 
is provided under the same general arrangement as a plan under 
such section 401(k), if— 
(1) no employee of an organization described in section 
403(b)(1)(A)(i) of such Code is eligible to participate in such 
section 401(k) plan or section 401(m) plan, and 
(2) 95 percent of the employees who are not employees 
of an organization described in section 403(b)(1)(A)(i) of such 
Code are eligible to participate in such plan under such section 
401 (k) or (m). 
(b) EFFECTIVE DATE.—The modification required by subsection 
(a) shall apply as of the same date set forth in section 1426(b) 
of the Small Business Job Protection Act of 1996. 
SEC. 1255. CLARIFICATION OF TREATMENT OF EMPLOYER-PROVIDED 
RETIREMENT ADVICE. 
(a) IN GENERAL.—Subsection (a) of section 132 (relating to 
exclusion from gross income) is amended by striking ‘‘or’’ at the 
end of paragraph (5), by striking the period at the end of paragraph 
(6) and inserting ‘‘, or’’, and by adding at the end the following 
new paragraph: 
‘‘(7) qualified retirement planning services.’’. 
(b) QUALIFIED RETIREMENT PLANNING SERVICES DEFINED.—Sec-
tion 132 is amended by redesignating subsection (m) as subsection 
(n) and by inserting after subsection (l) the following: 
‘‘(m) QUALIFIED RETIREMENT PLANNING SERVICES.— 
‘‘(1) IN GENERAL.—For purposes of this section, the term 
‘qualified retirement planning services’ means any retirement 
planning service provided to an employee and his spouse by 
an employer maintaining a qualified employer plan. 
‘‘(2) NONDISCRIMINATION
RULE.—Subsection (a)(7) shall 
apply in the case of highly compensated employees only if 
such services are available on substantially the same terms 
to each member of the group of employees normally provided 
education and information regarding the employer’s qualified 
employer plan. 
‘‘(3) QUALIFIED EMPLOYER PLAN.—For purposes of this sub-
section, the term ‘qualified employer plan’ means a plan, con-
tract, pension, or account described in section 219(g)(5).’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to years beginning after December 31, 2000. 
SEC. 1256. REPORTING SIMPLIFICATION. 
(a) SIMPLIFIED ANNUAL FILING REQUIREMENT FOR OWNERS AND 
THEIR SPOUSES.— 
(1) IN
GENERAL.—The Secretary of the Treasury shall 
modify the requirements for filing annual returns with respect 
to one-participant retirement plans to ensure that such plans 
with assets of $250,000 or less as of the close of the plan 
year need not file a return for that year. 
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