(ii) by striking ‘‘earlier’’ and inserting 
‘‘later’’ in subparagraph (A), 
(C) by inserting ‘‘on or’’ before ‘‘after’’ 
each place it appears in paragraph (5), and 
(D) by adding at the end the following new 
paragraph: 
‘‘(6) SPECIAL
RULE
FOR
VESTING
REQUIRE-
MENTS.—The requirements of section 203(f)(2) of 
the Employee Retirement Income Security Act of 
1974 and section 411(a)(13)(B) of the Internal Rev-
enue Code of 1986 (as added by this Act)— 
‘‘(A) shall not apply to a participant who 
does not have an hour of service after the effec-
tive date of such requirements (as otherwise de-
termined under this subsection); and 
‘‘(B) in the case of a plan other than a 
plan described in paragraph (3) or (4), shall 
apply to plan years ending on or after June 29, 
2005.’’. 
SEC. 108. AMENDMENTS RELATED TO TITLE VIII. 
(a) AMENDMENTS RELATED TO SECTION 801.— 
(1) Section 404(o) of the 1986 Code is amend-
ed— 
(A) by striking ‘‘430(g)(2)’’ in paragraph 
(2)(A)(ii) and inserting ‘‘430(g)(3)’’, and
(B) by striking ‘‘412(f)(4)’’ in paragraph 
(4)(B) and inserting ‘‘412(d)(3)’’. 
(2) Section 404(a)(7)(A) of the 1986 Code is 
amended— 
(A) by striking the next to last sentence, 
and 
(B) by striking ‘‘the plan’s funding short-
fall determined under section 430’’ in the last 
sentence and inserting ‘‘the excess (if any) of 
the plan’s funding target (as defined in section 
430(d)(1)) over the value of the plan’s assets 
(as determined under section 430(g)(3))’’. 
(b) AMENDMENT RELATED TO SECTION 802.—Sec-
tion 404(a)(1)(D)(i) of the 1986 Code is amended by 
striking ‘‘431(c)(6)(C)’’ and inserting ‘‘431(c)(6)(D)’’. 
(c) AMENDMENT RELATED
TO SECTION 803.— 
Clause (iii) of section 404(a)(7)(C) of the 1986 Code is 
amended to read as follows: 
‘‘(iii) LIMITATION.—In the case of 
employer contributions to 1 or more de-
fined contribution plans— 
‘‘(I) if such contributions do not 
exceed 6 percent of the compensation 
otherwise paid or accrued during the 
taxable year to the beneficiaries under
such plans, this paragraph shall not 
apply to such contributions or to em-
ployer contributions to the defined 
benefit plans to which this paragraph 
would otherwise apply by reason of 
contributions to the defined contribu-
tion plans, and 
‘‘(II) if such contributions exceed 
6 percent of such compensation, this 
paragraph shall be applied by only 
taking into account such contributions 
to the extent of such excess. 
For purposes of this clause, amounts car-
ried over from preceding taxable years 
under subparagraph (B) shall be treated 
as employer contributions to 1 or more de-
fined contributions plans to the extent at-
tributable to employer contributions to 
such plans in such preceding taxable 
years.’’. 
(d) AMENDMENTS RELATED TO SECTION 824.— 
(1) Section 408A(c)(3)(B) of the 1986 Code, as 
in effect after the amendments made by section 
824(b)(1) of the 2006 Act, is amended—
(A) by striking the second ‘‘an’’ before ‘‘el-
igible’’, 
(B) by striking ‘‘other than a Roth IRA’’, 
and 
(C) by adding at the end the following new 
flush sentence: 
‘‘This subparagraph shall not apply to a quali-
fied rollover contribution from a Roth IRA or 
to a qualified rollover contribution from a des-
ignated Roth account which is a rollover con-
tribution described in section 402A(c)(3)(A).’’ 
(2) Section 408A(d)(3)(B), as in effect after 
the amendments made by section 824(b)(2)(B) of 
the 2006 Act, is amended by striking ‘‘(other than 
a Roth IRA)’’ and by inserting at the end the fol-
lowing new sentence: ‘‘This paragraph shall not 
apply to a distribution which is a qualified rollover 
contribution from a Roth IRA or a qualified rollover 
contribution from a designated Roth account which 
is a rollover contribution described in section 
402A(c)(3)(A)’’. 
(e) AMENDMENT TO SECTION 827.—The first sen-
tence of section 72(t)(2)(G)(iv) of the 1986 Code is 
amended by inserting ‘‘on or’’ before ‘‘before’’. 
(f) AMENDMENTS RELATED TO SECTION 829.—
(1) Section 402(c)(11) of the 1986 Code is 
amended— 
(A) by inserting ‘‘described in paragraph 
(8)(B)(iii)’’ after ‘‘eligible retirement plan’’ in 
subparagraph (A), and 
(B) by striking ‘‘trust’’ before ‘‘designated 
beneficiary’’ in subparagraph (B). 
(2)(A) Section 402(f)(2)(A) of the 1986 Code is 
amended by adding at the end the following new 
sentence: ‘‘Such term shall include any distribution 
to a designated beneficiary which would be treated 
as an eligible rollover distribution by reason of sub-
section 
(c)(11), 
or 
section 
403(a)(4)(B), 
403(b)(8)(B), or 457(e)(16)(B), if the requirements 
of subsection (c)(11) were satisfied.’’ 
(B) Clause (i) of section 402(c)(11)(A) of the 
1986 Code is amended by striking ‘‘for purposes of 
this subsection’’. 
(C) The amendments made by this paragraph 
shall apply with respect to plan years beginning 
after December 31, 2009. 
(g) AMENDMENT RELATED TO SECTION 832.—Sec-
tion 415(f) of the 1986 Code is amended by striking para-
graph (2) and by redesignating paragraph (3) as para-
graph (2).
(h) AMENDMENTS RELATED TO SECTION 833.— 
(1) Section 408A(c)(3)(C) of the 1986 Code, as 
added by section 833(c) of the 2006 Act, is redesig-
nated as subparagraph (E). 
(2) In the case of taxable years beginning after 
December 31, 2009, section 408A(c)(3)(E) of the 
1986 Code (as redesignated by paragraph (1))— 
(A) is redesignated as subparagraph (D), 
and 
(B) is amended by striking ‘‘subparagraph 
(C)(ii)’’ and inserting ‘‘subparagraph (B)(ii)’’. 
(i) AMENDMENTS RELATED TO SECTION 841.— 
(1) Section 420(c)(1)(A) of the 1986 Code is 
amended by adding at the end the following new 
sentence: ‘‘In the case of a qualified future transfer 
or collectively bargained transfer to which subsection 
(f) applies, any assets so transferred may also be 
used to pay liabilities described in subsection 
(f)(2)(C).’’ 
(2) Section 420(f)(2) of the 1986 Code is 
amended by striking ‘‘such’’ before ‘‘the applicable’’ 
in subparagraph (D)(i)(I). 
(3) Section 4980(c)(2)(B) of the 1986 Code is 
amended by striking ‘‘or’’ at the end of clause (i), 
by striking the period at the end of clause (ii) and
inserting ‘‘, or’’, and by adding at the end the fol-
lowing new clause: 
‘‘(iii) any transfer described in section 
420(f)(2)(B)(ii)(II).’’. 
(j) AMENDMENTS RELATED TO SECTION 845.— 
(1) Subsection (l) of section 402 of the 1986 
Code is amended— 
(A) in paragraph (1)— 
(i) by inserting ‘‘maintained by the 
employer described in paragraph (4)(B)’’ 
after ‘‘an eligible retirement plan’’, and 
(ii) by striking ‘‘of the employee, his 
spouse, or dependents (as defined in sec-
tion 152)’’ , 
(B) in paragraph (4)(D), by— 
(i) inserting ‘‘(as defined in section 
152)’’ after ‘‘dependents’’, and 
(ii) striking ‘‘health insurance plan’’ 
and inserting ‘‘health plan’’, and 
(C) in paragraph (5)(A), by striking 
‘‘health insurance plan’’ and inserting ‘‘health 
plan’’. 
(2) Subparagraph (B) of section 402(l)(3) of 
the 1986 Code is amended by striking ‘‘all amounts 
distributed from all eligible retirement plans were
treated as 1 contract for purposes of determining 
the inclusion of such distribution under section 72’’ 
and inserting ‘‘all amounts to the credit of the eligi-
ble public safety officer in all eligible retirement 
plans maintained by the employer described in para-
graph (4)(B) were distributed during such taxable 
year and all such plans were treated as 1 contract 
for purposes of determining under section 72 the ag-
gregate amount which would have been so includ-
ible’’. 
(k) AMENDMENTS RELATED TO SECTION 854.— 
(1) Section 3121(b)(5)(E) of the 1986 Code is 
amended by striking ‘‘or special trial judge’’. 
(2) Section 210(a)(5)(E) of the Social Security 
Act is amended by striking ‘‘or special trial judge’’. 
(l) AMENDMENTS RELATED TO SECTION 856.—Sec-
tion 856 of the 2006 Act, and the amendments made by 
such section, are hereby repealed, and the Internal Rev-
enue Code of 1986 shall be applied and administered as 
if such sections and amendments had not been enacted. 
(m) AMENDMENT RELATED TO SECTION 864.—Sec-
tion 864(a) of the 2006 Act is amended by striking ‘‘Rec-
onciliation’’.
SEC. 109. AMENDMENTS RELATED TO TITLE IX. 
(a) AMENDMENT RELATED TO SECTION 901.—Sec-
tion 401(a)(35)(E)(iv) of the 1986 Code is amended to 
read as follows: 
‘‘(iv) ONE-PARTICIPANT RETIREMENT 
PLAN.—For purposes of clause (iii), the 
term 
‘one-participant 
retirement 
plan’ 
means a retirement plan that on the first 
day of the plan year— 
‘‘(I) covered only one individual 
(or the individual and the individual’s 
spouse) and the individual (or the in-
dividual and the individual’s spouse) 
owned 100 percent of the plan spon-
sor (whether or not incorporated), or 
‘‘(II) covered only one or more 
partners 
(or 
partners 
and 
their 
spouses) in the plan sponsor.’’. 
(b) AMENDMENTS RELATED TO SECTION 902.— 
(1) Section 401(k)(13)(D)(i)(I) of the 1986 
Code is amended by striking ‘‘such compensation as 
exceeds 1 percent but does not’’ and inserting ‘‘such 
contributions as exceed 1 percent but do not’’. 
(2) Sections 401(k)(8)(E) and 411(a)(3)(G) of 
the 1986 Code are each amended—
(A) by striking ‘‘an erroneous automatic 
contribution’’ and inserting ‘‘a permissible with-
drawal’’, and 
(B) by striking ‘‘ERRONEOUS AUTOMATIC 
CONTRIBUTION’’ in the heading and inserting 
‘‘PERMISSIBLE WITHDRAWAL’’. 
(3) Section 402(g)(2)(A)(ii) of the 1986 Code is 
amended by inserting ‘‘through the end of such tax-
able year’’ after ‘‘such amount’’. 
(4) Section 414(w)(3) of the 1986 Code is 
amended— 
(A) in subparagraph (B), by inserting 
‘‘and’’ after the comma at the end, 
(B) by striking subparagraph (C), and 
(C) by redesignating subparagraph (D) as 
subparagraph (C). 
(5) Section 414(w)(5) of the 1986 Code is 
amended by striking ‘‘and’’ at the end of subpara-
graph (B), by striking the period at the end of sub-
paragraph (C) and inserting a comma, and by add-
ing at the end the following: 
‘‘(D) a simplified employee pension the 
terms of which provide for a salary reduction 
arrangement described in section 408(k)(6), 
and
‘‘(E) a simple retirement account (as de-
fined in section 408(p)).’’. 
(6) Section 414(w)(6) of the 1986 Code is 
amended by inserting ‘‘or for purposes of applying 
the limitation under section 402(g)(1)’’ before the 
period at the end. 
(c) AMENDMENTS RELATED TO SECTION 903.— 
(1) AMENDMENT
OF
1986
CODE.—Section 
414(x)(1) of the 1986 Code is amended by adding 
at the end of paragraph (1) the following new sen-
tence: ‘‘In the case of a termination of the defined 
benefit plan and the applicable defined contribution 
plan forming part of an eligible combined plan, the 
plan administrator shall terminate each such plan 
separately.’’ 
(2) AMENDMENTS OF ERISA.—Section 210(e) 
of ERISA is amended— 
(A) by adding at the end of paragraph (1) 
the following new sentence: ‘‘In the case of a 
termination of the defined benefit plan and the 
applicable defined contribution plan forming 
part of an eligible combined plan, the plan ad-
ministrator shall terminate each such plan sep-
arately.’’, and
(B) by striking paragraph (3) and by re-
designating paragraphs (4), (5), and (6) as 
paragraphs (3), (4), and (5), respectively. 
(d) AMENDMENTS RELATED TO SECTION 906.— 
(1) Section 906(b)(1)(B)(ii) of the 2006 Act is 
amended by striking ‘‘paragraph (1)’’ and inserting 
‘‘paragraph (10)’’. 
(2) Section 4021(b) of ERISA is amended by 
inserting ‘‘or’’ at the end of paragraph (12), by 
striking ‘‘; or’’ at the end of paragraph (13) and in-
serting a period, and by striking paragraph (14). 
SEC. 110. AMENDMENTS RELATED TO TITLE X. 
(a) AMENDMENTS
TO
RAILROAD
RETIREMENT 
ACT.— 
(1) Section 14(b) of the Railroad Retirement 
Act of 1974 (45 U.S.C. 231m(b)) is amended by 
adding at the end the following: 
‘‘(3)(A) Payments made pursuant to paragraph 
(2) of this subsection shall not require that the em-
ployee be entitled to an annuity under section 
2(a)(1) of this Act: Provided, however, That where 
an employee is not entitled to such an annuity, pay-
ments made pursuant to paragraph (2) may not 
begin before the month in which the following three 
conditions are satisfied:
‘‘(i) The employee has completed ten years 
of service in the railroad industry or, five years 
of service all of which accrues after December 
31, 1995. 
‘‘(ii) The spouse or former spouse attains 
age 62. 
‘‘(iii) The employee attains age 62 (or if 
deceased, would have attained age 62). 
‘‘(B) Payments made pursuant to paragraph 
(2) of this subsection shall terminate upon the death 
of the spouse or former spouse, unless the court doc-
ument provides for termination at an earlier date. 
Notwithstanding the language in a court order, that 
portion of payments made pursuant to paragraph 
(2) which represents payments computed pursuant 
to section 3(f)(2) of this Act shall not be paid after 
the death of the employee. 
‘‘(C) If the employee is not entitled to an annu-
ity under section 2(a)(1) of this Act, payments made 
pursuant to paragraph (2) of this subsection shall be 
computed as though the employee were entitled to 
an annuity.’’. 
(2) Subsection (d) of section 5 of the Railroad 
Retirement Act (45 U.S.C. 231d) is repealed. 
(b) EFFECTIVE DATES.—
(1) 
SUBSECTION
(a)(1).—The 
amendment 
made by subsection (a)(1) shall apply with respect to 
payments due for months after August 2007. If, 
prior to the effective date of such amendment, pay-
ment pursuant to paragraph (2) of section 14(b) of 
the Railroad Retirement Act of 1974 (45 U.S.C. 
231m(b)) was terminated because of the employee’s 
death, payment to the former spouse may be rein-
stated for months after August 2007. 
(2) 
SUBSECTION
(a)(2).—The 
amendment 
made by subsection (a)(2) shall take effect upon the 
date of the enactment of this Act. 
SEC. 111. AMENDMENTS RELATED TO TITLE XI. 
(a) AMENDMENT RELATED TO SECTION 1104.—Sec-
tion 1104(d)(1) of the 2006 Act is amended by striking 
‘‘Act’’ the first place it appears and inserting ‘‘section’’. 
(b) AMENDMENTS RELATED TO SECTION 1105.— 
Section 3304(a) of the 1986 Code is amended— 
(1) in paragraph (15)— 
(A) by redesignating clauses (i) and (ii) of 
subparagraph (A) as subclauses (I) and (II), 
(B) by redesignating subparagraphs (A) 
and (B) as clauses (i) and (ii),
(C) by striking the semicolon at the end of 
clause (ii) (as so redesignated) and inserting ‘‘, 
and’’, 
(D) by striking ‘‘(15)’’ and inserting 
‘‘(15)(A) subject to subparagraph (B),’’, and 
(E) by adding at the end the following: 
‘‘(B) the amount of compensation shall not 
be reduced on account of any payments of gov-
ernmental or other pensions, retirement or re-
tired pay, annuity, or other similar payments 
which are not includible in the gross income of 
the individual for the taxable year in which it 
was paid because it was part of a rollover dis-
tribution;’’, and 
(2) by striking the last sentence. 
(c) AMENDMENTS RELATED TO SECTION 1106.— 
Section 3(37)(G) of ERISA is amended by— 
(1) striking ‘‘paragraph’’ each place it appears 
in clauses (ii), (iii), and (v)(I) and inserting ‘‘sub-
paragraph’’, 
(2) striking ‘‘subclause (i)(II)’’ in clause (iii) 
and inserting ‘‘clause (i)(II)’’, 
(3) striking ‘‘subparagraph’’ in clause (v)(II) 
and inserting ‘‘clause’’, and
(4) by striking ‘‘section 101(b)(4)’’ in clause 
(v)(III) and inserting ‘‘section 101(b)(1)’’. 
SEC. 112. EFFECTIVE DATE. 
Except as otherwise provided in this subtitle, the 
amendments made by this subtitle shall take effect as if 
included in the provisions of the 2006 Act to which the 
amendments relate. 
Subtitle B—Other Provisions 
SEC. 121. AMENDMENTS RELATED TO SECTIONS 102 AND 
112 OF THE PENSION PROTECTION ACT OF 
2006. 
(a) AMENDMENT OF ERISA.—The last sentence of 
section 303(g)(3)(B) of ERISA is amended to read as fol-
lows: ‘‘Any such averaging shall be adjusted for contribu-
tions, distributions, and expected earnings (as determined 
by the plan’s actuary on the basis of an assumed earnings 
rate specified by the actuary but not in excess of the third 
segment rate applicable under subsection (h)(2)(C)(iii)), 
as specified by the Secretary of the Treasury.’’. 
(b) AMENDMENT OF 1986 CODE.—The last sentence 
of section 430(g)(3)(B) of the 1986 Code is amended to 
read as follows: ‘‘Any such averaging shall be adjusted for 
contributions, distributions, and expected earnings (as de-
termined by the plan’s actuary on the basis of an assumed 
earnings rate specified by the actuary but not in excess
of the third segment rate applicable under subsection 
(h)(2)(C)(iii)), as specified by the Secretary.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as if included in the provisions 
of the 2006 Act to which the amendments relate. 
SEC. 122. MODIFICATION OF INTEREST RATE ASSUMPTION 
REQUIRED 
WITH 
RESPECT 
TO 
CERTAIN 
SMALL EMPLOYER PLANS. 
(a) IN GENERAL.—Subparagraph (E) of section 
415(b)(2) of the 1986 Code (relating to limitation on cer-
tain assumptions) is amended by adding at the end the 
following new clause: 
‘‘(vi) In the case of a plan maintained 
by an eligible employer (as defined in sec-
tion 408(p)(2)(C)(i)), clause (ii) shall be 
applied without regard to subclause (II) 
thereof.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to years beginning after December 
31, 2008. 
SEC. 123. DETERMINATION OF MARKET RATE OF RETURN 
FOR GOVERNMENTAL PLANS. 
(a) 
AMENDMENT
OF
ADEA.—Section 
4(i)(10)(B)(i)(III) of the Age Discrimination in Employ-
ment Act of 1967 (29 U.S.C. 623(i)(10)(B)(i)(III)) is
amended by adding at the end the following: ‘‘In the case 
of a governmental plan (as defined in the first sentence 
of section 414(d) of the Internal Revenue Code of 1986), 
a rate of return or a method of crediting interest estab-
lished pursuant to any provision of Federal, State, or local 
law (including any administrative rule or policy adopted 
in accordance with any such law) shall be treated as a 
market rate of return for purposes of subclause (I) and 
a permissible method of crediting interest for purposes of 
meeting the requirements of subclause (I), except that this 
sentence shall only apply to a rate of return or method 
of crediting interest if such rate or method does not violate 
any other requirement of this Act.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall take effect as if included in the provisions 
of the Pension Protection Act of 2006 to which such 
amendment relates. 
SEC. 124. TREATMENT OF CERTAIN REIMBURSEMENTS 
FROM GOVERNMENTAL PLANS FOR MEDICAL 
CARE. 
(a) IN GENERAL.—Section 105 of the 1986 Code (re-
lating to amounts received under accident and health 
plans) is amended by adding at the end the following new 
subsection:
‘‘(j) SPECIAL RULE FOR CERTAIN GOVERNMENTAL 
PLANS.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(b), amounts paid (directly or indirectly) to the tax-
payer from an accident or health plan described in 
paragraph (2) shall not fail to be excluded from 
gross income solely because such plan, on or before 
January 1, 2008, provides for reimbursements of 
health care expenses of a deceased plan participant’s 
beneficiary. 
‘‘(2) PLAN DESCRIBED.—An accident or health 
plan is described in this paragraph if such plan is 
funded by a medical trust that is established in con-
nection with a public retirement system and that— 
‘‘(A) has been authorized by a State legis-
lature, or 
‘‘(B) has received a favorable ruling from 
the Internal Revenue Service that the trust’s in-
come is not includible in gross income under 
section 115.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to payments before, on, or after 
the date of the enactment of this Act.
SEC. 125. ROLLOVER OF AMOUNTS RECEIVED IN AIRLINE 
CARRIER BANKRUPTCY TO ROTH IRAS. 
(a) GENERAL RULE.—If a qualified airline employee 
receives any airline payment amount and transfers any 
portion of such amount to a Roth IRA within 180 days 
of receipt of such amount (or, if later, within 180 days 
of the date of the enactment of this Act), then such 
amount (to the extent so transferred) shall be treated as 
a qualified rollover contribution described in section 
408A(e) of the Internal Revenue Code of 1986, and the 
limitations described in section 408A(c)(3) of such Code 
shall not apply to any such transfer. 
(b) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
(1) AIRLINE PAYMENT AMOUNT.— 
(A) IN GENERAL.—The term ‘‘airline pay-
ment amount’’ means any payment of any 
money or other property which is payable by a 
commercial passenger airline carrier to a quali-
fied airline employee— 
(i) under the approval of an order of 
a Federal bankruptcy court in a case filed 
after September 11, 2001, and before Jan-
uary 1, 2007, and 
(ii) in respect of the qualified airline 
employee’s interest in a bankruptcy claim
against the carrier, any note of the carrier 
(or amount paid in lieu of a note being 
issued), or any other fixed obligation of the 
carrier to pay a lump sum amount. 
The amount of such payment shall be deter-
mined without regard to any requirement to de-
duct and withhold tax from such payment 
under sections 3102(a) and 3402(a). 
(B) 
EXCEPTION.—An 
airline 
payment 
amount shall not include any amount payable 
on the basis of the carrier’s future earnings or 
profits. 
(2) QUALIFIED AIRLINE EMPLOYEE.—The term 
‘‘qualified airline employee’’ means an employee or 
former employee of a commercial passenger airline 
carrier who was a participant in a defined benefit 
plan maintained by the carrier which— 
(A) is a plan described in section 401(a) of 
the Internal Revenue Code of 1986 which in-
cludes a trust exempt from tax under section 
501(a) of such Code, and 
(B) was terminated or became subject to 
the restrictions contained in paragraphs (2) and 
(3) of section 402(b) of the Pension Protection 
Act of 2006.
(3) REPORTING REQUIREMENTS.—If a commer-
cial passenger airline carrier pays 1 or more airline 
payment amounts, the carrier shall, within 90 days 
of such payment (or, if later, within 90 days of the 
date of the enactment of this Act), report— 
(A) to the Secretary of the Treasury, the 
names of the qualified airline employees to 
whom such amounts were paid, and 
(B) to the Secretary and to such employ-
ees, the years and the amounts of the pay-
ments. 
Such reports shall be in such form, and contain such 
additional information, as the Secretary may pre-
scribe. 
(c) EFFECTIVE DATE.—This section shall apply to 
transfers made after the date of the enactment of this Act 
with respect to airline payment amounts paid before, on, 
or after such date. 
SEC. 126. DETERMINATION OF ASSET VALUE FOR SPECIAL 
AIRLINE FUNDING RULES. 
(a) IN GENERAL.—Section 402(e)(4)(C) of the 2006 
Act is amended to read as follows: 
‘‘(C) the value of plan assets shall be de-
termined under sections 303(g)(3) of such Act 
and 430(g)(3) of such Code.’’.
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to plan years beginning after De-
cember 31, 2007. 
SEC. 127. MODIFICATION OF PENALTY FOR FAILURE TO 
FILE PARTNERSHIP RETURNS. 
(a) IN GENERAL.—Section 6698(b)(1) of the 1986 
Code is amended by striking ‘‘$85’’ and inserting ‘‘$89’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to returns required to be filed 
after December 31, 2008. 
SEC. 128. MODIFICATION OF PENALTY FOR FAILURE TO 
FILE S CORPORATION RETURNS. 
(a) IN GENERAL.—Section 6699(b)(1) of the 1986 
Code is amended by striking ‘‘$85’’ and inserting ‘‘$89’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to returns required to be filed 
after December 31, 2008. 
TITLE II—PENSION PROVISIONS 
RELATING TO ECONOMIC CRISIS 
SEC. 201. TEMPORARY WAIVER OF REQUIRED MINIMUM 
DISTRIBUTION RULES FOR CERTAIN RETIRE-
MENT PLANS AND ACCOUNTS. 
(a) IN GENERAL.—Section 401(a)(9) of the Internal 
Revenue Code of 1986 (relating to required distributions)
is amended by adding at the end the following new sub-
paragraph: 
‘‘(H) TEMPORARY
WAIVER
OF
MINIMUM 
REQUIRED DISTRIBUTION.— 
‘‘(i) IN GENERAL.—The requirements 
of this paragraph shall not apply for cal-
endar year 2009 to— 
‘‘(I) a defined contribution plan 
which is described in this subsection 
or in section 403(a) or 403(b), 
‘‘(II) a defined contribution plan 
which is an eligible deferred com-
pensation plan described in section 
457(b) but only if such plan is main-
tained by an employer described in 
section 457(e)(1)(A), or 
‘‘(III) an individual retirement 
plan. 
‘‘(ii) 
SPECIAL
RULES
REGARDING 
WAIVER
PERIOD.—For purposes of this 
paragraph— 
‘‘(I) the required beginning date 
with respect to any individual shall be 
determined without regard to this 
subparagraph for purposes of applying
this paragraph for calendar years 
after 2009, and 
‘‘(II) if clause (ii) of subpara-
graph (B) applies, the 5-year period 
described in such clause shall be de-
termined without regard to calendar 
year 2009.’’. 
(b) ELIGIBLE ROLLOVER DISTRIBUTIONS.—Section 
402(c)(4) of the Internal Revenue Code of 1986 (defining 
eligible rollover distribution) is amended by adding at the 
end the following new flush sentence: 
‘‘If all or any portion of a distribution during 2009 
is treated as an eligible rollover distribution but 
would not be so treated if the minimum distribution 
requirements under section 401(a)(9) had applied 
during 2009, such distribution shall not be treated 
as an eligible rollover distribution for purposes of 
section 401(a)(31) or 3405(c) or subsection (f) of 
this section.’’. 
(c) EFFECTIVE DATES.— 
(1) IN GENERAL.—The amendments made by 
this section shall apply for calendar years beginning 
after December 31, 2008. 
(2) PROVISIONS RELATING TO PLAN OR CON-
TRACT AMENDMENTS.—
(A) IN GENERAL.—If this paragraph ap-
plies to any pension plan or contract amend-
ment, such pension plan or contract shall not 
fail to be treated as being operated in accord-
ance with the terms of the plan during the pe-
riod described in subparagraph (B)(ii) solely be-
cause the plan operates in accordance with this 
section. 
(B) AMENDMENTS TO WHICH PARAGRAPH 
APPLIES.— 
(i) IN
GENERAL.—This paragraph 
shall apply to any amendment to any pen-
sion plan or annuity contract which— 
(I) is made pursuant to the 
amendments made by this section, 
and 
(II) is made on or before the last 
day of the first plan year beginning 
on or after January 1, 2011. 
In the case of a governmental plan, sub-
clause (II) shall be applied by substituting 
‘‘2012’’ for ‘‘2011’’. 
(ii) 
CONDITIONS.—This 
paragraph 
shall not apply to any amendment unless 
during the period beginning on the effec-
tive date of the amendment and ending on 
December 31, 2009, the plan or contract is 
operated as if such plan or contract 
amendment were in effect. 
SEC. 202. TRANSITION RULE CLARIFICATION. 
(a) AMENDMENT TO ERISA.—Subparagraph (B) of 
section 303(c)(5) of the Employee Retirement Income Se-
curity Act of 1974 (29 U.S.C. 1083(c)(5)) is amended— 
(1) by striking clause (iii) and redesignating 
clause (iv) as clause (iii); and 
(2) by striking clause (i) and inserting the fol-
lowing: 
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (iii), in the case of plan 
years beginning after 2007 and before 
2011, only the applicable percentage of the 
funding target shall be taken into account 
under paragraph (3)(A) in determining the 
funding shortfall for purposes of para-
graph (3)(A) and subparagraph (A).’’. 
(b) AMENDMENT
TO 1986 CODE.—Subparagraph 
(B) of section 430(c)(5) of the Internal Revenue Code of 
1986 is amended— 
(1) by striking clause (iii) and redesignating 
clause (iv) as clause (iii); and
(2) by striking clause (i) and inserting the fol-
lowing: 
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (iii), in the case of plan 
years beginning after 2007 and before 
2011, only the applicable percentage of the 
funding target shall be taken into account 
under paragraph (3)(A) in determining the 
funding shortfall for purposes of para-
graph (3)(A) and subparagraph (A).’’. 
(c) EFFECTIVE DATE.—The amendments made by 
subsections (a) and (b) shall apply as if included in the 
enactment of sections 102 and 112, respectively, of the 
Pension Protection Act of 2006. 
SEC. 203. TEMPORARY MODIFICATION OF APPLICATION OF 
LIMITATION ON BENEFIT ACCRUALS. 
In the case of the first plan year beginning during 
the period beginning on October 1, 2008, and ending on 
September 30, 2009, sections 206(g)(4)(A) of the Em-
ployee Retirement Income Security Act of 1974 (29 
U.S.C. 1056(g)(4)(A)) and 436(e)(1) of the Internal Rev-
enue Code of 1986 shall be applied by substituting the 
plan’s adjusted funding target attainment percentage for 
the preceding plan year for such percentage for such plan
(c) ELECTION AND NOTICE.— 
(1) ELECTION.—An election under subsection 
(a) shall— 
(A) be made at such time and in such 
manner as the Secretary of the Treasury or the 
Secretary’s delegate may prescribe and, once 
made, may be revoked only with the consent of 
the Secretary, and 
(B) if the election is made— 
(i) before the date the annual certifi-
cation is submitted to the Secretary or the 
Secretary’s 
delegate 
under 
section 
305(b)(3) 
of 
such 
Act 
and 
section 
432(b)(3) of such Code, be included with 
such annual certification, and 
(ii) after such date, be submitted to 
the Secretary or the Secretary’s delegate 
not later than 30 days after the date of the 
election. 
(2) NOTICE TO PARTICIPANTS.— 
(A) IN
GENERAL.—Notwithstanding sec-
tion 305(b)(3)(D) of such Act and section 
431(b)(3)(D) of such Code, if the plan is nei-
ther in endangered nor critical status by reason 
of an election made under subsection (a)—
(i) the plan sponsor of a multiem-
ployer plan shall not be required to provide 
notice under such sections, and 
(ii) the plan sponsor shall provide to 
the participants and beneficiaries, the bar-
gaining parties, the Pension Benefit Guar-
anty Corporation, and the Secretary of 
Labor a notice of the election and such 
other information as the Secretary of the 
Treasury (in consultation with the Sec-
retary of Labor) may require— 
(I) if the election is made before 
the date the annual certification is 
submitted to the Secretary or the Sec-
retary’s 
delegate 
under 
section 
305(b)(3) of such Act and section 
432(b)(3) of such Code, not later than 
30 days after the date of the certifi-
cation, and 
(II) if the election is made after 
such date, not later than 30 days 
after the date of the election. 
(B) NOTICE OF ENDANGERED STATUS.— 
Notwithstanding section 305(b)(3)(D) of such 
Act and section 431(b)(3)(D) of such Code, if
the plan is certified to be in critical status for 
any plan year but is in endangered status by 
reason of an election made under subsection 
(a), the notice provided under such sections 
shall be the notice which would have been pro-
vided if the plan had been certified to be in en-
dangered status. 
SEC. 205. TEMPORARY EXTENSION OF THE FUNDING IM-
PROVEMENT AND REHABILITATION PERIODS 
FOR MULTIEMPLOYER PENSION PLANS IN 
CRITICAL AND ENDANGERED STATUS FOR 
2008 OR 2009. 
(a) IN GENERAL.—If the plan sponsor of a multiem-
ployer plan which is in endangered or critical status for 
a plan year beginning in 2008 or 2009 (determined after 
application of section 204) elects the application of this 
section, then, for purposes of section 305 of the Employee 
Retirement Income Security Act of 1974 and section 432 
of the Internal Revenue Code of 1986— 
(1) except as provided in paragraph (2), the 
plan’s funding improvement period or rehabilitation 
period, whichever is applicable, shall be 13 years 
rather than 10 years, and
(2) in the case of a plan in seriously endan-
gered status, the plan’s funding improvement period 
shall be 18 years rather than 15 years. 
(b) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
(1) ELECTION.—An election under this section 
shall be made at such time, and in such manner and 
form, as (in consultation with the Secretary of 
Labor) the Secretary of the Treasury or the Sec-
retary’s delegate may prescribe. 
(2) DEFINITIONS.—Any term which is used in 
this section which is also used in section 305 of the 
Employee Retirement Income Security Act of 1974 
and section 432 of the Internal Revenue Code of 
1986 shall have the same meaning as when used in 
such sections. 
(c) EFFECTIVE DATE.—This section shall apply to 
plan years beginning after December 31, 2007. 
Passed the House of Representatives December 10, 
2008. 
Attest: 
Clerk.
110TH CONGRESS 
2D SESSION 
H. R. 7327 
AN ACT 
To make technical corrections related to the Pen-
sion Protection Act of 2006, and for other pur-
poses.