(2) in the heading by striking ‘‘QUALIFIED RE-
TIREMENT PLANS’’ and inserting ‘‘CERTAIN TAX-
FAVORED PLANS’’.
(d) TAX ON EXCESS CONTRIBUTIONS.—Section 4973
of such Code (relating to tax on excess contributions to
certain tax-favored accounts and annuities) is amended—
(1) in subsection (a) by striking ‘‘or’’ at the end
of paragraph (3), by inserting ‘‘or’’ at the end of
paragraph (4), and by inserting after paragraph (4)
the following new paragraph:
‘‘(5) a volunteer firefighter savings account (as
defined in section 222(c)),’’, and
(2) by adding at the end the following new sub-
section:
‘‘(g) EXCESS CONTRIBUTIONS TO VOLUNTEER FIRE-
FIGHTER SAVINGS ACCOUNTS.—For purposes of this sec-
tion, in the case of a volunteer firefighter savings account,
the term ‘excess contributions’ means the sum of—
‘‘(1) the aggregate amount contributed for the
taxable year to the account which is not allowable as
a deduction under section 222 for such taxable year,
and
‘‘(2) the amount determined under this sub-
section for the preceding taxable year, reduced by—
‘‘(A) the distributions out of the accounts
which were included in gross income under sec-
tion 222(d)(1) for the taxable year, over
‘‘(B) the amount contributed to the ac-
counts for the taxable year.
For purposes of this subsection, any contribution
which is distributed out of the volunteer firefighter
account in a distribution to which section 222(d)(2)
applies shall be treated as an amount not contrib-
uted.’’.
(e) TAX ON PROHIBITED TRANSACTIONS.—Section
4975 of such Code (relating to prohibited transactions)
is amended—
(1) by adding at the end of subsection (c) the
following new paragraph:
‘‘(6) SPECIAL
RULE
FOR
VOLUNTEER
FIRE-
FIGHTER
SAVINGS
ACCOUNTS.—An individual for
whose benefit a volunteer firefighter savings account
is established and any contributor to such account
shall be exempt from the tax imposed by this section
with respect to any transaction concerning such ac-
count (which would otherwise be taxable under this
section) if, with respect to such transaction, the ac-
count ceases to be a volunteer firefighter savings ac-
count by reason of the application of section 222 to
such account.’’, and
(2) in subsection (e)(1) by striking ‘‘or’’ at the
end of subparagraph (E), by redesignating subpara-
graph (F) as subparagraph (G), and by inserting
after subparagraph (E) the following new subpara-
graph:
‘‘(F) a volunteer firefighter savings ac-
count described in section 222, or’’.
(f) FAILURE TO PROVIDE REPORTS ON VOLUNTEER
FIREFIGHTER SAVINGS ACCOUNTS.—Paragraph (2) of
section 6693(a) of such Code (relating to failure to provide
reports on certain tax-favored accounts or annuities) is
amended by striking ‘‘and’’ at the end of subparagraph
(C), by striking the period at the end of subparagraph (D)
and inserting ‘‘, and’’, and by adding at the end the fol-
lowing new subparagraph:
‘‘(E) section 222(g) (relating to volunteer
firefighter savings accounts).’’.
(g) CONFORMING AMENDMENTS.—
(1) Paragraph (1) of section 408(a) is amended
by inserting ‘‘222(d)(3),’’ before ‘‘402(c)’’.
(2) The table of sections for part VII of sub-
chapter B of chapter 1 of such Code is amended by
striking the item relating to section 222 and insert-
ing the following new items:
‘‘Sec. 222. Contributions to volunteer firefighter savings accounts.
‘‘Sec. 223. Cross reference.’’
(h) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
the date of the enactment of this Act.
Æ