107 
HR 2830 PCS 
subsection (h)(2), applied under rules similar to the 
rules of subparagraph (B) of subsection (h)(2). 
‘‘(3) SHORTFALL
AMORTIZATION
BASE.—For 
purposes of this section, the shortfall amortization 
base of a plan for a plan year is the excess (if any) 
of— 
‘‘(A) the funding shortfall of such plan for 
such plan year, over 
‘‘(B) the sum of— 
‘‘(i) the present value (determined 
using the segment rates determined under 
subparagraph (C) of subsection (h)(2), ap-
plied under rules similar to the rules of 
subparagraph (B) of subsection (h)(2)) of 
the aggregate total of the shortfall amorti-
zation installments, for such plan year and 
the 5 succeeding plan years, which have 
been determined with respect to the short-
fall amortization bases of the plan for each 
of the 6 plan years preceding such plan 
year, and 
‘‘(ii) the present value (as so deter-
mined) of the aggregate total of the waiver 
amortization installments for such plan 
year and the 5 succeeding plan years,
108 
HR 2830 PCS 
which have been determined with respect 
to the waiver amortization bases of the 
plan for each of the 5 plan years preceding 
such plan year. 
‘‘(4) FUNDING SHORTFALL.—For purposes of 
this section, the funding shortfall of a plan for any 
plan year is the excess (if any) of— 
‘‘(A) the funding target of the plan for the 
plan year, over 
‘‘(B) the value of plan assets of the plan 
(as reduced under subsection (f)(4)(B)) for the 
plan year which are held by the plan on the 
valuation date. 
‘‘(5) EXEMPTION FROM NEW SHORTFALL AM-
ORTIZATION BASE.— 
‘‘(A) IN GENERAL.—In any case in which 
the value of plan assets of the plan (as reduced 
under subsection (f)(4)(A)) is equal to or great-
er than the funding target of the plan for the 
plan year, the shortfall amortization base of the 
plan for such plan year shall be zero. 
‘‘(B) TRANSITION RULE.— 
‘‘(i) IN GENERAL.—In the case of a 
non-deficit reduction plan, subparagraph 
(A) shall be applied to plan years begin-
109 
HR 2830 PCS 
ning after 2006 and before 2011 by sub-
stituting, for the funding target of the plan 
for the plan year, the applicable percentage 
of such funding target determined under 
the following table: 
‘‘In the case of a plan year beginning in calendar 
year: 
The appli-
cable per-
centage is: 
2007 ..............................................................................................
92 percent
2008 ..............................................................................................
94 percent
2009 ..............................................................................................
96 percent
2010 ..............................................................................................
98 percent. 
‘‘(ii) LIMITATION.—Clause (i) shall 
not apply with respect to any plan year 
after 2007 unless the ratio (expressed as a 
percentage) which— 
‘‘(I) the value of plan assets for 
each preceding plan year after 2006 
(as 
reduced 
under 
subsection 
(f)(4)(A)), bears to 
‘‘(II) the funding target of the 
plan for such preceding plan year (de-
termined without regard to subsection 
(i)(1)), 
is not less than the applicable percentage 
with respect to such preceding plan deter-
mined under clause (i).
110 
HR 2830 PCS 
‘‘(iii) 
NON-DEFICIT
REDUCTION 
PLAN.—For purposes of clause (i), the 
term ‘non-deficit reduction plan’ means 
any plan— 
‘‘(I) to which this part (as in ef-
fect on the day before the date of the 
enactment of the Pension Protection 
Act of 2005) applied for the plan year 
beginning in 2006, and 
‘‘(II) to which section 412(d) (as 
so in effect) did not apply for such 
plan year. 
‘‘(6) EARLY DEEMED AMORTIZATION UPON AT-
TAINMENT OF FUNDING TARGET.—In any case in 
which the funding shortfall of a plan for a plan year 
is zero, for purposes of determining the shortfall am-
ortization charge for such plan year and succeeding 
plan years, the shortfall amortization bases for all 
preceding plan years (and all shortfall amortization 
installments determined with respect to such bases) 
shall be reduced to zero. 
‘‘(d) RULES RELATING TO FUNDING TARGET.—For 
purposes of this section— 
‘‘(1) FUNDING TARGET.—Except as provided in 
subsection (i)(1) with respect to plans in at-risk sta-
111 
HR 2830 PCS 
tus, the funding target of a plan for a plan year is 
the present value of all liabilities to participants and 
their beneficiaries under the plan for the plan year. 
‘‘(2) FUNDING TARGET ATTAINMENT PERCENT-
AGE.—The ‘funding target attainment percentage’ of 
a plan for a plan year is the ratio (expressed as a 
percentage) which— 
‘‘(A) the value of plan assets for the plan 
year (as reduced under subsection (f)(4)(B)), 
bears to 
‘‘(B) the funding target of the plan for the 
plan year (determined without regard to sub-
section (i)(1)). 
‘‘(e) WAIVER AMORTIZATION CHARGE.— 
‘‘(1) DETERMINATION
OF
WAIVER
AMORTIZA-
TION CHARGE.—The waiver amortization charge (if 
any) for a plan for any plan year is the aggregate 
total of the waiver amortization installments for 
such plan year with respect to the waiver amortiza-
tion bases for each of the 5 preceding plan years. 
‘‘(2) WAIVER AMORTIZATION INSTALLMENT.— 
The plan sponsor shall determine, with respect to 
the waiver amortization base of the plan for any 
plan year, the amounts necessary to amortize such 
waiver amortization base, in level annual install-
112 
HR 2830 PCS 
ments over a period of 5 plan years beginning with 
the succeeding plan year. For purposes of paragraph 
(1), the annual installment of such amortization for 
each plan year in such 5-plan year period is the 
waiver amortization installment for such plan year 
with respect to such waiver amortization base. 
‘‘(3) INTEREST
RATE.—In determining any 
waiver amortization installment under this sub-
section, the plan sponsor shall use the segment rates 
determined under subparagraph (C) of subsection 
(h)(2), applied under rules similar to the rules of 
subparagraph (B) of subsection (h)(2). 
‘‘(4) WAIVER AMORTIZATION BASE.—The waiv-
er amortization base of a plan for a plan year is the 
amount of the waived funding deficiency (if any) for 
such plan year under section 412(c). 
‘‘(5) EARLY DEEMED AMORTIZATION UPON AT-
TAINMENT OF FUNDING TARGET.—In any case in 
which the funding shortfall of a plan for a plan year 
is zero, for purposes of determining the waiver am-
ortization charge for such plan year and succeeding 
plan years, the waiver amortization base for all pre-
ceding plan years shall be reduced to zero.
113 
HR 2830 PCS 
‘‘(f) REDUCTION OF MINIMUM REQUIRED CONTRIBU-
TION BY PRE-FUNDING BALANCE AND FUNDING STAND-
ARD CARRYOVER BALANCE.— 
‘‘(1) ELECTION TO MAINTAIN BALANCES.— 
‘‘(A) PRE-FUNDING BALANCE.—The plan 
sponsor of a defined benefit plan which is not 
a multiemployer plan may elect to maintain a 
pre-funding balance. 
‘‘(B) FUNDING
STANDARD
CARRYOVER 
BALANCE.— 
‘‘(i) IN GENERAL.—In the case of a 
defined benefit plan (other than a multiem-
ployer plan) described in clause (ii), the 
plan sponsor may elect to maintain a fund-
ing standard carryover balance, until such 
balance is reduced to zero. 
‘‘(ii) PLANS
MAINTAINING
FUNDING 
STANDARD ACCOUNT IN 2006.—A plan is 
described in this clause if the plan— 
‘‘(I) was in effect for a plan year 
beginning in 2006, and 
‘‘(II) had a positive balance in 
the funding standard account under 
section 412(b) as in effect for such
114 
HR 2830 PCS 
plan year and determined as of the 
end of such plan year. 
‘‘(2) APPLICATION OF BALANCES.—A pre-fund-
ing balance and a funding standard carryover bal-
ance maintained pursuant to this paragraph— 
‘‘(A) shall be available for crediting against 
the minimum required contribution, pursuant to 
an election under paragraph (3), 
‘‘(B) shall be applied as a reduction in the 
amount treated as the value of plan assets for 
purposes of this section, to the extent provided 
in paragraph (4), and 
‘‘(C) may be reduced at any time, pursu-
ant to an election under paragraph (5). 
‘‘(3) ELECTION TO APPLY BALANCES AGAINST 
MINIMUM REQUIRED CONTRIBUTION.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraphs (B) and (C), in the case of any 
plan year in which the plan sponsor elects to 
credit against the minimum required contribu-
tion for the current plan year all or a portion 
of the pre-funding balance or the funding 
standard carryover balance for the current plan 
year (not in excess of such minimum required 
contribution), the minimum required contribu-
115 
HR 2830 PCS 
tion for the plan year shall be reduced by the 
amount so credited by the plan sponsor. For 
purposes of the preceding sentence, the min-
imum required contribution shall be determined 
after taking into account any waiver under sec-
tion 412(c). 
‘‘(B) 
COORDINATION
WITH
FUNDING 
STANDARD CARRYOVER BALANCE.—To the ex-
tent that any plan has a funding standard car-
ryover balance greater than zero, no amount of 
the pre-funding balance of such plan may be 
credited under this paragraph in reducing the 
minimum required contribution. 
‘‘(C) LIMITATION
FOR
UNDERFUNDED 
PLANS.—The preceding provisions of this para-
graph shall not apply for any plan year if the 
ratio (expressed as a percentage) which— 
‘‘(i) the value of plan assets for the 
preceding plan year (as reduced under 
paragraph (4)(C)), bears to 
‘‘(ii) the funding target of the plan for 
the preceding plan year (determined with-
out regard to subsection (i)(1)), 
is less than 80 percent.