I
107TH CONGRESS
1ST SESSION
H. R. 738
To amend the Internal Revenue Code of 1986 to provide additional retirement
savings opportunities for small employers, including self-employed individuals.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 27, 2001
Mr. BLUNT (for himself, Mr. BENTSEN, Mr. LARGENT, Mr. SHADEGG, Mr.
RILEY, Mr. SHIMKUS, Mr. CHAMBLISS, Mr. RADANOVICH, Mr. SESSIONS,
Mr. COOKSEY, Mr. LATOURETTE, Mr. YOUNG of Alaska, Mrs. WILSON,
Mr. ALLEN, Mr. BALDACCI, Mr. DELAHUNT, Mr. FROST, Mr. KAN-
JORSKI, Mr. MOORE, Mr. SANDLIN, Mr. MALONEY of Connecticut, Mr.
SHOWS, Ms. PRYCE of Ohio, Mr. BONILLA, Mr. HILLIARD, Mr. HIN-
CHEY, Mr. STENHOLM, Mr. SKEEN, Mr. SCHAFFER, Mr. MCHUGH, Mr.
JONES of North Carolina, Mr. SIMPSON, Mr. HUTCHINSON, Mr. PITTS,
Mr. CALVERT, Ms. BERKLEY, Mr. HALL of Texas, Mr. DOOLITTLE, Ms.
HOOLEY of Oregon, Mr. PASCRELL, Mr. THOMPSON of Mississippi, Mr.
MORAN of Kansas, Mr. THUNE, Mr. LEWIS of Kentucky, Ms. MCCARTHY
of Missouri, Mr. HALL of Ohio, Mr. POMEROY, Mr. WALDEN of Oregon,
Mr. WHITFIELD, Mr. OXLEY, Mr. OTTER, Mr. MCINTYRE, Mr. PETER-
SON of Pennsylvania, Mr. SUNUNU, Mrs. BONO, Mr. WATTS of Okla-
homa, Mr. GILLMOR, Mr. SANDERS, Mr. CLEMENT, Mr. FOSSELLA, Mr.
HASTINGS of Washington, Mr. JOHNSON of Illinois, Mr. MORAN of Vir-
ginia, Mr. TAYLOR of North Carolina, Mr. LAMPSON, Mrs. NORTHUP,
Mr. SOUDER, Mr. DEMINT, Mr. WATKINS, Mr. TERRY, Mr. PETERSON
of Minnesota) 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 provide
additional retirement savings opportunities for small em-
ployers, including self-employed individuals.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. REFERENCE.
Except as otherwise expressly provided, whenever in
this Act an amendment or repeal is expressed in terms
of an amendment to, or repeal of, a section or other provi-
sion, the reference shall be considered to be made to a
section or other provision of the Internal Revenue Code
of 1986.
SEC. 2. QUALIFIED SMALL EMPLOYER PLAN.
(a) IN GENERAL.—Section 401 is amended by redes-
ignating subsection (o) as subsection (p) and by inserting
after subsection (n) the following new subsection:
‘‘(o) QUALIFIED SMALL EMPLOYER PLAN.—
‘‘(1) IN GENERAL.—A trust created or orga-
nized in the United States and forming part of a
small employer plan of a small employer for the ex-
clusive benefit of its employees or their beneficiaries
constitutes a qualified trust under subsection (a) if
such plan meets the requirements of paragraph (2).
‘‘(2) REQUIREMENTS.—A plan meets the re-
quirements of this paragraph if—
‘‘(A) such plan is the only qualified retire-
ment plan of a small employer,
‘‘(B) the plan year for such plan is the cal-
endar year,
‘‘(C) as of the 1st day of the plan year,
such plan covers all eligible employees of the
employer,
‘‘(D) such plan meets the contribution re-
quirements of paragraph (4),
‘‘(E) such plan meets the vesting require-
ments of paragraph (5),
‘‘(F) such plan meets the funding require-
ments of section 412, if applicable, and
‘‘(G) such plan meets the other require-
ments specified in paragraph (6).
‘‘(3) ELIGIBLE
EMPLOYEE.—For purposes of
paragraph (2)(C), the term ‘eligible employee’ means
an individual who—
‘‘(A) has attained age 21, and
‘‘(B) has completed not less than 1,000
hours of service for the employer during the cal-
endar year preceding the plan year.
‘‘(4) CONTRIBUTIONS.—A plan meets the re-
quirements of this paragraph if—
‘‘(A) employer contributions to the plan—