by subsection (j), except that in the case of a 
payment other than a required installment, the 
due date shall be the date such payment is re-
quired to be made under section 303. 
‘‘(C) CONTROLLED GROUP.—The term ‘con-
trolled group’ means any group treated as a sin-
gle employer under subsections (b), (c), (m), and 
(o) of section 414 of the Internal Revenue Code 
of 1986. 
‘‘(l) QUALIFIED TRANSFERS TO HEALTH BENEFIT AC-
COUNTS.—In the case of a qualified transfer (as defined in 
section 420 of the Internal Revenue Code of 1986), any as-
sets so transferred shall not, for purposes of this section, 
be treated as assets in the plan.’’. 
(b) CLERICAL AMENDMENT.—The table of sections in 
section 1 of such Act (as amended by section 101) is amend-
ed by inserting after the item relating to section 302 the 
following new item: 
‘‘Sec. 303. Minimum funding standards for single-employer defined benefit pen-
sion plans.’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply with respect to plan years beginning 
after 2005.
SEC. 103. BENEFIT LIMITATIONS UNDER SINGLE-EMPLOYER 
PLANS. 
(a) PROHIBITION
OF
SHUTDOWN
BENEFITS
AND 
OTHER UNPREDICTABLE CONTINGENT EVENT BENEFITS 
UNDER SINGLE-EMPLOYER PLANS.—Section 206 of the 
Employee Retirement Income Security Act of 1974 (29 
U.S.C. 1056) is amended by adding at the end the following 
new subsection: 
‘‘(g) PROHIBITION
OF SHUTDOWN BENEFITS
AND 
OTHER UNPREDICTABLE CONTINGENT EVENT BENEFITS 
UNDER SINGLE-EMPLOYER PLANS.— 
‘‘(1) IN GENERAL.—No pension plan which is a 
single-employer plan may provide benefits to which 
participants are entitled solely by reason of the occur-
rence of— 
‘‘(A) a plant shutdown, or 
‘‘(B) any other unpredictable contingent 
event. 
‘‘(2) UNPREDICTABLE CONTINGENT EVENT.—For 
purposes of this subsection, the term ‘unpredictable 
contingent event’ means an event other than— 
‘‘(A) attainment of any age, performance of 
any service, receipt or derivation of any com-
pensation, or the occurrence of death or dis-
ability, or
‘‘(B) an event which is reasonably and reli-
ably predictable (as determined by the Secretary 
of the Treasury).’’. 
(b) OTHER LIMITS ON BENEFITS AND BENEFIT AC-
CRUALS.— 
(1) IN GENERAL.—Section 206 of such Act (as 
amended by subsection (a)) is amended further by 
adding at the end the following new subsection: 
‘‘(h) FUNDING-BASED LIMITS ON BENEFITS AND BEN-
EFIT ACCRUALS UNDER SINGLE-EMPLOYER PLANS.— 
‘‘(1) LIMITATIONS
ON
PLAN
AMENDMENTS
IN-
CREASING LIABILITY FOR BENEFITS.— 
‘‘(A) IN
GENERAL.—No amendment to a 
single-employer plan which has the effect of in-
creasing liabilities of the plan by reason of in-
creases in benefits, establishment of new benefits, 
changing the rate of benefit accrual, or changing 
the rate at which benefits become nonforfeitable 
to the plan may take effect during any plan year 
if the funding target attainment percentage as of 
the valuation date of the plan for such plan year 
is— 
‘‘(i) less than 80 percent, or 
‘‘(ii) would be less than 80 percent tak-
ing into account such amendment.
For purposes of this subparagraph, any increase 
in benefits under the plan by reason of an in-
crease in the benefit rate provided under the 
plan or on the basis of an increase in compensa-
tion shall be treated as affected by plan amend-
ment. 
‘‘(B) EXEMPTION.—Subparagraph (A) shall 
cease to apply with respect to any plan year, ef-
fective as of the first date of the plan year (or 
if later, the effective date of the amendment), 
upon payment by the plan sponsor of a contribu-
tion (in addition to any minimum required con-
tribution under section 303) equal to— 
‘‘(i) in the case of subparagraph (A)(i), 
the amount of the increase in the funding 
target of the plan (under section 303) for 
the plan year attributable to the amend-
ment, and 
‘‘(ii) in the case of subparagraph 
(A)(ii), the amount sufficient to result in a 
funding target attainment percentage of 80 
percent. 
‘‘(2) FUNDING-BASED
LIMITATION
ON
CERTAIN 
FORMS OF DISTRIBUTION.—
‘‘(A) IN GENERAL.—A single-employer plan 
shall provide that, in any case in which the 
plan’s funding target attainment percentage as 
of the valuation date of the plan for a plan year 
is less than 80 percent, the plan may not after 
such date pay any prohibited payment (as de-
fined in section 206(e)). 
‘‘(B) EXCEPTION.—Subparagraph (A) shall 
not apply to any plan for any plan year if the 
terms of such plan (as in effect for the period be-
ginning on June 29, 2005, and ending with such 
plan year) provide for no benefit accruals with 
respect to any participant during such period. 
‘‘(3) LIMITATIONS ON BENEFIT ACCRUALS FOR 
PLANS WITH SEVERE FUNDING SHORTFALLS.—A sin-
gle-employer plan shall provide that, in any case in 
which the plan’s funding target attainment percent-
age as of the valuation date of the plan for a plan 
year is less than 60 percent, all future benefit accru-
als under the plan shall cease as of such date. 
‘‘(4) NEW PLANS.—Paragraphs (1) and (3) shall 
not apply to a plan for the first 5 plan years of the 
plan. For purposes of this paragraph, the reference in 
this paragraph to a plan shall include a reference to 
any predecessor plan.