be treated as if the qualified individual 
were the account owner. 
‘‘(ii) QUALIFIED
INDIVIDUAL.—For 
purposes of clause (i), the term ‘qualified 
individual’ means, with respect to any ac-
count owner— 
‘‘(I) the account owner’s sur-
viving spouse, or 
‘‘(II) any other person with cus-
tody of any child of the deceased ac-
count owner, but only if such death 
occurred not later than 1 year after 
the birth or adoption of such child by 
the deceased account owner. 
‘‘(B) OTHER CASES.— 
‘‘(i) IN GENERAL.—If, by reason of 
the death of the account owner, any person 
acquires the account owner’s interest in a 
parental leave savings account in a case to 
which subparagraph (A) does not apply— 
‘‘(I) such account shall cease to 
be a parental leave savings account as 
of the date of death, and 
‘‘(II) an amount equal to the fair 
market value of the assets in such ac-
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count on such date shall be includible 
if such person is not the estate of 
such owner, in such person’s gross in-
come for the taxable year which in-
cludes such date, or if such person is 
the estate of such owner, in such own-
er’s gross income for the last taxable 
year of such owner. 
‘‘(ii) SPECIAL
RULES.—An appro-
priate deduction shall be allowed under 
section 691(c) to any person (other than 
the decedent or the decedent’s spouse) with 
respect to amounts included in gross in-
come under clause (i) by such person. 
‘‘(f) TAX TREATMENT OF ACCOUNT.— 
‘‘(1) IN GENERAL.—A parental leave savings 
account shall be exempt from taxation under this 
subtitle. Notwithstanding the preceding sentence, 
the parental leave savings account shall be subject to 
the taxes imposed by section 511 (relating to imposi-
tion of tax on unrelated business income of chari-
table, etc. organizations). 
‘‘(2) ACCOUNT TERMINATIONS.—Rules similar 
to the rules of paragraphs (2) and (4) of section 
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408(e) shall apply to any parental leave savings ac-
count. 
‘‘(g) ONE ACCOUNT PER INDIVIDUAL.—An indi-
vidual may not own more than one parental leave savings 
account. The Secretary shall prescribe such rules as are 
necessary to provide for liquidating an individual’s paren-
tal leave savings account for transfer to a new parental 
leave savings account of the individual and for treating 
such amounts as a rollover distribution described in sub-
section (e)(3). 
‘‘(h) REPORTS.—The owner of a parental leave sav-
ings account shall make such reports regarding such ac-
count to the Secretary with respect to contributions, dis-
tributions, the return of excess contributions, and such 
other matters as the Secretary may require. The reports 
required by this subsection shall be filed at such time and 
in such manner and furnished to such individuals at such 
time and in such manner as may be required by the Sec-
retary. 
‘‘(i) COST-OF-LIVING ADJUSTMENT.— 
‘‘(1) IN GENERAL.—In the case of taxable years 
beginning in a calendar year after 2018, each dollar 
amount in subsections (b)(1) and (b)(2) shall be in-
creased by an amount equal to— 
‘‘(A) such dollar amount, multiplied by 
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‘‘(B) the cost of living adjustment deter-
mined under section 1(f)(3) for the calendar 
year in which such taxable year begins deter-
mined by substituting ‘calendar year 2017’ for 
‘calendar year 1992’ in subparagraph (B) 
thereof. 
‘‘(2) ROUNDING.—If any increase under para-
graph (1) is not a multiple of $50, such increase 
shall be rounded to the nearest multiple of $50.’’. 
(b) DEDUCTION ALLOWED WHETHER OR NOT INDI-
VIDUAL ITEMIZES OTHER DEDUCTIONS.—Section 62(a) 
of such Code is amended by inserting after paragraph (21) 
the following new paragraph: 
‘‘(22) PARENTAL LEAVE SAVINGS ACCOUNTS.— 
The deduction allowed under section 224.’’. 
(c) EXCLUSION FOR EMPLOYER CONTRIBUTIONS TO 
PARENTAL LEAVE SAVINGS ACCOUNTS.— 
(1) IN GENERAL.—Part III of subchapter B of 
chapter 1 of such Code is amended by inserting 
after section 139F the following new section: 
‘‘SEC. 139G. CONTRIBUTIONS BY EMPLOYER TO PARENTAL 
LEAVE SAVINGS ACCOUNTS. 
‘‘(a) IN GENERAL.—Gross income of an employee 
does not include contributions by the employer to the pa-
rental leave savings account of the employee to the extent 
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such amounts do not exceed the limitation under section 
224(b)(1) (determined without regard to this section) 
which is applicable to such employee for such taxable year. 
‘‘(b) PARENTAL LEAVE SAVINGS ACCOUNT.—For 
purposes of this section, the term ‘parental leave savings 
account’ shall have the meaning given to such term by 
section 224. 
‘‘(c) EXCLUSION
NOT
TO
EXCEED
COMPENSA-
TION.— 
‘‘(1) EMPLOYEES.—The amount excluded from 
gross income by subsection (a) with respect to an 
employee shall not exceed such employee’s wages, 
salaries, tips, and other employee compensation 
which are attributable to such employee’s employ-
ment by the employer referred to in such subsection. 
‘‘(2) 
SELF-EMPLOYED
INDIVIDUALS.—The 
amount excluded from gross income by subsection 
(a) for contributions with respect to an individual 
who is self-employed shall not exceed such individ-
ual’s earned income (as defined in section 401(c)(2)) 
derived by the taxpayer from the trade or business 
with respect to which the individual is self-employed. 
‘‘(3) COMMUNITY
PROPERTY
LAWS
NOT
TO 
APPLY.—The limitations under this subsection shall 
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be determined without regard to community prop-
erty laws.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 3121(a) of such Code is 
amended by striking ‘‘or’’ at the end of para-
graph (22), by striking the period at the end of 
paragraph (23) and inserting ‘‘; or’’, and by in-
serting after paragraph (23) the following new 
paragraph: 
‘‘(24) any payment made to a parental leave 
savings account (as defined in section 224) or an 
employee.’’. 
(B) Section 3231(e) of such Code is 
amended by adding at the end the following 
new paragraph: 
‘‘(13) PARENTAL
LEAVE
SAVINGS
ACCOUNT 
CONTRIBUTIONS.—The term ‘compensation’ shall 
not include any payment made to a parental leave 
savings account (as defined in section 224) of an 
employee.’’. 
(C) Section 3306(b) of such Code is 
amended by striking ‘‘or’’ at the end of para-
graph (19), by striking the period at the end of 
paragraph (20) and inserting ‘‘; or’’, and by in-
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