I 
109TH CONGRESS 
2D SESSION 
H. R. 5322 
To amend the Internal Revenue Code of 1986 to increase the contribution 
limits for individual retirement plans, defined contribution plans, and 
salary reduction plans, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 9, 2006 
Ms. GINNY BROWN-WAITE of Florida introduced the following bill; which was 
referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to increase 
the contribution limits for individual retirement plans, 
defined contribution plans, and salary reduction plans, 
and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Retirement Enhance-
ment Act of 2006’’. 
SEC. 2. MODIFICATION OF LIMITS ON CONTRIBUTIONS TO 
CERTAIN RETIREMENT ACCOUNTS. 
(a) INDIVIDUAL RETIREMENT ACCOUNTS.— 
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(1) IN GENERAL.—The table in subparagraph 
(A) of section 219(b)(5) of the Internal Revenue 
Code of 1986 (defining deductible amount) is 
amended to read as follows: 
‘‘For taxable years beginning in: 
The de-
ductible 
amount 
is: 
2007 or 2008 ...............................................................
$8,000
2009 or thereafter ........................................................
$10,000.’’. 
(2) COST OF LIVING ADJUSTMENT.—Clause (i) 
of section 219(b)(5)(C) of such Code is amended— 
(A) in the matter preceding subclause (I) 
by striking ‘‘after 2008, the $5,000’’ and in-
serting ‘‘after 2009, the $10,000’’, and 
(B) in subclause (II) by striking ‘‘calendar 
year 2007’’ and inserting ‘‘calendar year 
2008’’. 
(3) INCREASE
IN
CATCH-UP
CONTRIBUTION 
AMOUNT.—Subparagraph (B) of section 219(b)(5) 
of such Code is amended to read as follows: 
‘‘(B) CATCH-UP CONTRIBUTIONS FOR INDI-
VIDUALS 50 OR OLDER.—In the case of an indi-
vidual who has attained the age of 50 before 
the close of the taxable year, the deductible 
amount for such taxable year shall be increased 
by $2,000.’’. 
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(4) INCREASE IN LIMITATION ON DEDUCTION 
FOR
ACTIVE
PARTICIPANTS
IN
CERTAIN
PENSION 
PLANS.— 
(A) JOINT RETURNS.—Clause (i) of section 
219(g)(3)(B) of such Code is amended to read 
as follows: 
‘‘(i) In the case of a taxpayer filing a 
joint return for taxable years beginning in 
2007 or thereafter, the applicable dollar 
amount is $240,000.’’. 
(B) RETURNS
OTHER
THAN
JOINT
AND 
MARRIED FILING SEPARATELY.—Clause (ii) of 
section 219(g)(3)(B) of such Code is amended 
to read as follows: 
‘‘(ii) In the case of any other taxpayer 
(other than a married individual filing a 
separate return), for taxable years begin-
ning in 2007 or thereafter, the applicable 
dollar amount is $150,000.’’. 
(C) COST-OF-LIVING ADJUSTMENT.—Para-
graph (3) of section 219(g) of such Code (relat-
ing to adjusted gross income; applicable dollar 
amount) is amended by adding at the end the 
following new subparagraph: 
‘‘(C) COST-OF-LIVING ADJUSTMENT.— 
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‘‘(i) IN GENERAL.—In the case of any 
taxable year beginning in a calendar year 
after 2007, the $240,000 amount in clause 
(i) and the $150,000 in clause (ii) of sub-
paragraph (B) shall each be increased by 
an amount equal to— 
‘‘(I) such dollar amount, multi-
plied by 
‘‘(II) the cost-of-living adjust-
ment determined under section 1(f)(3) 
for the calendar year in which the tax-
able year begins, determined by sub-
stituting ‘calendar year 2006’ for ‘cal-
endar year 1992’ in subparagraph (B) 
thereof. 
‘‘(ii) 
ROUNDING
RULES.—If 
any 
amount after adjustment under clause (i) 
is not a multiple of $500, such amount 
shall be rounded to the next lower multiple 
of $500.’’. 
(b) INCREASE IN ELECTIVE DEFERRALS TO QUALI-
FIED PLANS.— 
(1) IN GENERAL.—Subparagraph (A) of section 
402(g)(1) of the Internal Revenue Code of 1986 (re-
lating to general rule on limitation on exclusion for 
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elective deferrals) is amended by striking ‘‘the appli-
cable dollar amount’’ and inserting ‘‘$30,000’’. 
(2) COST-OF-LIVING ADJUSTMENT.—Paragraph 
(4) of section 402(g) of such Code (relating to is 
amended cost-of-living adjustment) is amended— 
(A) by striking ‘‘December 31, 2006’’ and 
inserting ‘‘December 31, 2007’’, and 
(B) by striking ‘‘$15,000’’ and inserting 
‘‘$30,000’’. 
(3) CATCH-UP CONTRIBUTIONS.— 
(A) PLANS
OTHER
THAN
SIMPLE
AND 
401(k) 
PLANS.—Clause 
(i) 
of 
section 
414(v)(2)(B) of such Code is amended by strik-
ing ‘‘applicable dollar amount shall be deter-
mined’’ and all that follows and inserting ‘‘ap-
plicable dollar amount shall be $10,000’’. 
(B) SIMPLE AND 401(k) PLANS.—Clause 
(ii) of section 414(v)(2)(B) of such Code is 
amended by striking ‘‘applicable dollar amount 
shall be determined’’ and all that follows and 
inserting ‘‘applicable dollar amount shall be 
$5,000’’. 
(C) INFLATION
ADJUSTMENT.—Subpara-
graph (C) of section 414(v)(2) of such Code is 
amended— 
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(i) by striking ‘‘December 31, 2006’’ 
and inserting ‘‘December 31, 2007’’, 
(ii) by striking ‘‘$5,000’’ and insert-
ing ‘‘$10,000’’, and 
(iii) by striking ‘‘$2,500’’ and insert-
ing ‘‘$5,000’’. 
(c) INCREASE
IN ELECTIVE DEFERRALS
TO 457 
PLANS.— 
(1) IN GENERAL.—Subparagraph (A) of section 
457(b)(2) of such Code (defining eligible deferred 
compensation plan) is amended to read as follows: 
‘‘(A) $30,000, or’’. 
(2) COST-OF-LIVING ADJUSTMENT.—Paragraph 
(15) of section 457(e) of such Code (relating to 
other definitions and special rules) is amended to 
read as follows: 
‘‘(15) COST-OF-LIVING
ADJUSTMENT.—In the 
case of taxable years beginning after December 31, 
2007, the Secretary shall adjust the $30,000 
amount under subsection (b)(2)(A) at the same time 
and in the same manner as under section 415(d), 
except that the base period shall be the calendar 
quarter beginning July 1, 2006, and any increase 
under this paragraph which is not a multiple of 
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$500 shall be rounded to the next lowest multiple of 
$500.’’. 
(d) DEFINED CONTRIBUTION PLANS.— 
(1) DOLLAR LIMIT.—Subparagraph (A) of sec-
tion 415(c)(1) of such Code (relating to limitation 
for defined contribution plans) is amended by strik-
ing ‘‘$40,000’’ and inserting ‘‘$80,000’’. 
(2) 
COST-OF-LIVING
ADJUSTMENTS.—Sub-
section (d) of section 415 of such Code (relating to 
cost-of-living adjustments) is amended— 
(A) by striking ‘‘$40,000’’ in paragraph 
(1)(C) and inserting ‘‘$80,000’’, and 
(B) in paragraph (3)(D)— 
(i) by striking ‘‘$40,000’’ in the head-
ing and inserting ‘‘$80,000’’, and 
(ii) by striking ‘‘July 1, 2001’’ and in-
serting ‘‘July 1, 2006’’. 
(e) SIMPLE RETIREMENT ACCOUNTS.— 
(1) 
IN
GENERAL.—Clause 
(i) 
of 
section 
408(p)(2)(E) of such Code is amended by striking 
‘‘applicable dollar amount shall be determined’’ and 
all that follows and inserting ‘‘applicable dollar 
amount shall be $20,000’’. 
(2) COST-OF-LIVING ADJUSTMENT.—Clause (ii) 
of section 408(p)(2)(E) of such Code is amended— 
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(A) by striking ‘‘December 31, 2005’’ and 
inserting ‘‘December 31, 2007’’, 
(B) by striking ‘‘$10,000’’ and inserting 
‘‘$20,000’’, and 
(C) by striking ‘‘July 1, 2004’’ and insert-
ing ‘‘July 1, 2006’’. 
(f) EFFECTIVE DATE.—The amendments made by 
this section shall apply to years beginning after December 
31, 2006. 
SEC. 3. ONE-TIME ELECTION TO APPLY HIGHER INCOME 
THRESHOLDS UNDER SAVERS CREDIT. 
(a) IN GENERAL.—Section 25B of the Internal Rev-
enue Code of 1986 (relating to elective deferrals and IRA 
contributions by certain individuals) is amended by redes-
ignating subsections (e), (f), (g), and (h) as subsections 
(f), (g), (h), and (i), respectively, and by inserting after 
subsection (d) the following new subsection: 
‘‘(e) ONE-TIME ELECTION TO APPLY HIGHER IN-
COME THRESHOLDS.— 
‘‘(1) IN GENERAL.—In the case of an eligible 
individual for whom an election is in effect under 
this subsection for any taxable year, subsection (b) 
shall be applied by substituting for each dollar 
amount specified in the table therein an amount 
equal to 200 percent of such dollar amount. 
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‘‘(2) ELECTION APPLIES ONLY TO 1 TAXABLE 
YEAR.—An election to have paragraph (1) apply 
with respect to any eligible individual may not be 
made for any taxable year if such an election is in 
effect with respect to such individual for any other 
prior taxable year.’’. 
(b) CREDIT MADE PERMANENT.— 
(1) REPEAL OF TERMINATION.—Section 25B of 
such Code, as amended by subsection (a), is amend-
ed by striking subsection (i). 
(2) REPEAL OF EGTRRA SUNSET.—Section 901 
of the Economic Growth and Tax Relief Reconcili-
ation Act of 2001 shall not apply to section 618 of 
such Act (relating to nonrefundable credit to certain 
individuals for elective deferrals and IRA contribu-
tions). 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2006. 
Æ 
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