serting after paragraph (20) the following new 
paragraph: 
‘‘(21) any payment made to a parental leave 
savings account (as defined in section 224) of an 
employee.’’. 
(D) Section 3401(a) of such Code is 
amended by striking ‘‘or’’ at the end of para-
graph (21), by striking the period at the end of 
paragraph (22) and inserting ‘‘; or’’, and by in-
serting after paragraph (22) the following new 
paragraph: 
‘‘(23) any payment made to a parental leave 
savings account (as defined in section 224) of an 
employee.’’. 
(E) Section 6051(a) of such Code is 
amended by striking ‘‘and’’ at the end of para-
graph (13), by striking the period at the end of 
paragraph (14) and inserting ‘‘, and’’, and by 
inserting after paragraph (14) the following 
new paragraph: 
‘‘(15) the amount contributed to any parental 
leave savings account (as defined in section 224) of 
such employee.’’. 
(d) PROHIBITED TRANSACTIONS.— 
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(1) EXCEPTION FOR TAXABLE DISTRIBUTIONS 
FROM PARENTAL LEAVE SAVINGS ACCOUNTS.—Sub-
section (c) of section 4975 of such Code (defining to 
prohibited transaction) is amended by adding at the 
end the following new paragraph: 
‘‘(7) SPECIAL RULE FOR PARENTAL LEAVE SAV-
INGS ACCOUNTS.—An individual for whose benefit a 
parental leave savings account (with the meaning of 
section 224) is established and any contributor to 
such account shall be exempt from the tax imposed 
by this section with respect to any transaction con-
cerning such account (which would otherwise be tax-
able under this section) if, with respect to such 
transaction, the account ceases to be a parental 
leave savings account by reason of the application of 
section 224(f)(2) to such account.’’. 
(2) PLAN
DEFINED.—Section 4975(e)(1) of 
such Code is amended by striking ‘‘or’’ at the end 
of subparagraph (F), by redesignating subparagraph 
(G) as subparagraph (H), and by inserting after 
subparagraph (F) the following new subparagraph: 
‘‘(G) a parental leave savings account de-
scribed in section 224, or’’. 
(e) PENALTY
ON FAILURE TO REPORT.—Section 
6693(a)(2) of such Code is amended by striking ‘‘and’’ 
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at the end of subparagraph (D), by striking the period 
at the end of subparagraph (E) and inserting ‘‘, and’’, 
and by inserting after subparagraph (E) the following new 
subparagraph: 
‘‘(F) section 224(g) (relating to parental 
leave savings accounts).’’. 
(f) CONFORMING AMENDMENT.—Section 26(b)(2) of 
such Code is amended by striking ‘‘and’’ at the end of 
subparagraph (X), by striking the period at the end of 
subparagraph (Y) and inserting ‘‘, and’’, and by adding 
at the end the following new subparagraph: 
‘‘(Z) section 224(e)(4) (relating to addi-
tional tax with respect to distributions not used 
for early parenthood payment purposes).’’. 
(g) CLERICAL AMENDMENTS.— 
(1) The table of sections for part VII of sub-
chapter B of chapter 1 of such Code is amended by 
redesignating the item relating to section 224 as an 
item relating to section 225 and by inserting after 
the item relating to section 223 the following new 
item: 
‘‘Sec. 224. Parental leave savings accounts.’’. 
(2) The table of sections for part III of sub-
chapter B of chapter 1 of such Code is amended by 
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inserting after the item relating to section 139F the 
following new item: 
‘‘Sec. 139G. Contributions by employer to parental leave savings accounts.’’. 
(h) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2017. 
Æ 
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