(2) NOTICE REQUIREMENT.—
(A) IN
GENERAL.—Section 101 of such 
Act (29 U.S.C. 1021) is amended—
(i) by redesignating subsection (j) as 
subsection (k); and 
(ii) by inserting after subsection (i) 
the following new subsection: 
‘‘(j) NOTICE OF FUNDING-BASED LIMITATION ON 
CERTAIN FORMS OF DISTRIBUTION.—The plan adminis-
trator of a defined benefit plan which is a single-employer 
plan shall provide a written notice to plan participants and 
beneficiaries within 30 days after the plan has become 
subject to the restriction described in section 206(h)(2) 
or at such other time as may be determined by the Sec-
retary.’’. 
(B) ENFORCEMENT.—Section 502(c)(4) of 
such Act (29 U.S.C. 1132(c)(4)) is amended by 
striking ‘‘section 302(b)(7)(F)(vi)’’ and insert-
ing ‘‘sections 101(j) and 302(b)(7)(F)(vi)’’. 
(c) EFFECTIVE DATE.—
(1) SHUTDOWN BENEFITS.—Except as provided 
in paragraph (3), the amendments made by sub-
section (a) shall apply with respect to plant shut-
downs, or other unpredictable contingent events, oc-
curring after 2006.
(2) OTHER BENEFITS.—Except as provided in 
paragraph (3), the amendments made by subsection 
(b) shall apply with respect to plan years beginning 
after 2006. 
(3) COLLECTIVE BARGAINING EXCEPTION.—In 
the case of a plan maintained pursuant to 1 or more 
collective bargaining agreements between employee 
representatives and 1 or more employers ratified be-
fore the date of the enactment of this Act, the 
amendments made by this subsection shall not apply 
to plan years beginning before the earlier of—
(A) the later of—
(i) the date on which the last collec-
tive bargaining agreement relating to the 
plan terminates (determined without re-
gard to any extension thereof agreed to 
after the date of the enactment of this 
Act), or 
(ii) the first day of the first plan year 
to which the amendments made by this 
subsection would (but for this subpara-
graph) apply, or 
(B) January 1, 2009. 
For purposes of clause (i), any plan amendment 
made pursuant to a collective bargaining agreement
relating to the plan which amends the plan solely to 
conform to any requirement added by this subsection 
shall not be treated as a termination of such collec-
tive bargaining agreement. 
(d) SPECIAL RULE FOR 2007.—For purposes of ap-
plying paragraph (5) of section 206(h) of such Act (as 
added by this section) to current plan years (within the 
meaning of such paragraph) beginning in 2007, the modi-
fied funded current liability percentage of the plan for the 
preceding year shall be substituted for the funding target 
attainment percentage of the plan for the preceding year. 
For purposes of the preceding sentence, the term ‘‘modi-
fied funded current liability percentage’’ means the funded 
current liability percentage (as defined in section 302(l)(8) 
of such Act), reduced as described in subparagraph (E) 
thereof in the case of a plan with a funded current liability 
percentage (as so defined and before such reduction) 
which is less than 100 percent. 
SEC. 104. TECHNICAL AND CONFORMING AMENDMENTS. 
(a) MISCELLANEOUS AMENDMENTS TO TITLE I.—
Subtitle B of title I of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1021 et seq.) is amend-
ed—
(1) in section 101(d)(3), by striking ‘‘section 
302(e)’’ and inserting ‘‘section 303(j)’’;
(2) in section 101(f)(2)(B), by striking clause 
(i) and inserting the following: 
‘‘(i) a statement as to whether—
‘‘(I) in the case of a defined ben-
efit plan which is a single-employer 
plan, the plan’s funding target attain-
ment percentage (as defined in section 
303(d)(2)), or 
‘‘(II) in the case of a defined 
benefit plan which is a multiemployer 
plan, the plan’s funded percentage (as 
defined in section 305(d)(2)), 
is at least 100 percent (and, if not, the ac-
tual percentage);’’; 
(3) in section 103(d)(8)(B), by striking ‘‘the re-
quirements of section 302(c)(3)’’ and inserting ‘‘the 
applicable requirements of sections 303(h) and 
304(c)(3)’’; 
(4) in section 103(d), by striking paragraph 
(11) and inserting the following: 
‘‘(11) If the current value of the assets of the 
plan is less than 70 percent of—
‘‘(A) in the case of a defined benefit plan 
which is a single-employer plan, the funding
target (as defined in section 303(d)(1)) of the 
plan, or 
‘‘(B) in the case of a defined benefit plan 
which is a multiemployer plan, the current li-
ability (as defined in section 304(c)(6)(D)) 
under the plan, 
the percentage which such value is of the amount 
described in subparagraph (A) or (B).’’; 
(5) in section 203(a)(3)(C), by striking ‘‘section 
302(c)(8)’’ and inserting ‘‘section 302(d)(2)’’; 
(6) in section 204(g)(1), by striking ‘‘section 
302(c)(8)’’ and inserting ‘‘section 302(d)(2)’’; 
(7) in section 204(i)(2)(B), by striking ‘‘section 
302(c)(8)’’ and inserting ‘‘section 302(d)(2)’’; 
(8) in section 204(i)(3), by striking ‘‘funded 
current liability percentage (within the meaning of 
section 302(d)(8) of this Act)’’ and inserting ‘‘fund-
ing target attainment percentage (as defined in sec-
tion 303(d)(2))’’; 
(9) in section 204(i)(4), by striking ‘‘section 
302(c)(11)(A), 
without 
regard 
to 
section 
302(c)(11)(B)’’ and inserting ‘‘section 302(b)(1), 
without regard to section 302(b)(2)’’; 
(10) in section 206(e)(1), by striking ‘‘section 
302(d)’’ and inserting ‘‘section 303(j)(4)’’, and by
striking ‘‘section 302(e)(5)’’ and inserting ‘‘section 
303(j)(4)(E)(i)’’; 
(11) in section 206(e)(3), by striking ‘‘section 
302(e) by reason of paragraph (5)(A) thereof’’ and 
inserting ‘‘section 303(j)(3) by reason of section 
303(j)(4)(A)’’; and 
(12) in sections 101(e)(3), 403(c)(1), and 
408(b)(13), by striking ‘‘American Jobs Creation 
Act of 2004’’ and inserting ‘‘Pension Protection Act 
of 2005’’. 
(b) MISCELLANEOUS AMENDMENTS TO TITLE IV.—
Title IV of such Act is amended—
(1) 
in 
section 
4001(a)(13) 
(29 
U.S.C. 
1301(a)(13)), by striking ‘‘302(c)(11)(A)’’ and in-
serting ‘‘302(b)(1)’’, by striking ‘‘412(c)(11)(A)’’ 
and 
inserting 
‘‘412(b)(1)’’, 
by 
striking 
‘‘302(c)(11)(B)’’ and inserting ‘‘302(b)(2)’’, and by 
striking ‘‘412(c)(11)(B)’’ and inserting ‘‘412(b)(2)’’; 
(2) 
in 
section 
4003(e)(1) 
(29 
U.S.C. 
1303(e)(1)), by striking ‘‘302(f)(1)(A) and (B)’’ and 
inserting ‘‘303(k)(1)(A) and (B)’’, and by striking 
‘‘412(n)(1)(A) 
and 
(B)’’ 
and 
inserting 
‘‘430(k)(1)(A) and (B)’’; 
(3) 
in 
section 
4010(b)(2) 
(29 
U.S.C. 
1310(b)(2)), by striking ‘‘302(f)(1)(A) and (B)’’ and
inserting ‘‘303(k)(1)(A) and (B)’’, and by striking 
‘‘412(n)(1)(A) 
and 
(B)’’ 
and 
inserting 
‘‘430(k)(1)(A) and (B)’’; 
(4) in section 4011(b) (29 U.S.C. 1311(b)), by 
striking ‘‘to which’’ and all that follows and insert-
ing ‘‘for any plan year for which the plan’s funding 
target attainment percentage (as defined in section 
303(d)(2)) is at least 90 percent.’’; 
(5) 
in 
section 
4062(c)(1) 
(29 
U.S.C. 
1362(c)(1)), by striking paragraphs (1), (2), and (3) 
and inserting the following: 
‘‘(1)(A) in the case of a single-employer plan, 
the sum of the shortfall amortization charge (within 
the meaning of section 303(c)(1) of this Act and 
430(c)(1) of the Internal Revenue Code of 1986) 
with respect to the plan (if any) for the plan year 
in which the termination date occurs, plus the aggre-
gate total of shortfall amortization installments (if 
any) determined for succeeding plan years under 
section 303(c)(2) of this Act and section 430(c)(2) 
of such Code (which, for purposes of this subpara-
graph, shall include any increase in such sum which 
would result if all applications for waivers of the 
minimum funding standard under section 302(c) of 
this Act and section 412(c) of such Code which are
pending with respect to such plan were denied and 
if no additional contributions (other than those al-
ready made by the termination date) were made for 
the plan year in which the termination date occurs 
or for any previous plan year), or 
‘‘(B) in the case of a multiemployer plan, the 
outstanding balance of the accumulated funding de-
ficiencies (within the meaning of section 304(a)(2) 
of this Act and section 431(a) of the Internal Rev-
enue Code of 1986) of the plan (if any) (which, for 
purposes of this subparagraph, shall include the 
amount of any increase in such accumulated funding 
deficiencies of the plan which would result if all 
pending applications for waivers of the minimum 
funding standard under section 302(c) of this Act or 
section 412(c) of such Code and for extensions of 
the amortization period under section 304(d) of this 
Act or section 431(d) of such Code with respect to 
such plan were denied and if no additional contribu-
tions (other than those already made by the termi-
nation date) were made for the plan year in which 
the termination date occurs or for any previous plan 
year), 
‘‘(2)(A) in the case of a single-employer plan, 
the sum of the waiver amortization charge (within
the meaning of section 303(e)(1) of this Act and 
430(j)(2) of the Internal Revenue Code of 1986) 
with respect to the plan (if any) for the plan year 
in which the termination date occurs, plus the aggre-
gate total of waiver amortization installments (if 
any) determined for succeeding plan years under 
section 303(e)(2) of this Act and section 430(j)(3) 
of such Code, or 
‘‘(B) in the case of a multiemployer plan, the 
outstanding balance of the amount of waived fund-
ing deficiencies of the plan waived before such date 
under section 302(c) of this Act or section 412(c) of 
such Code (if any), and 
‘‘(3) in the case of a multiemployer plan, the 
outstanding balance of the amount of decreases in 
the minimum funding standard allowed before such 
date under section 304(d) of this Act or section 
431(d) of such Code (if any);’’; 
(6) in section 4071 (29 U.S.C. 1371), by strik-
ing ‘‘302(f)(4)’’ and inserting ‘‘303(k)(4)’’; 
(7) in section 4243(a)(1)(B) (29 U.S.C. 
1423(a)(1)(B)), by striking ‘‘302(a)’’ and inserting 
‘‘304(a)’’, and, in clause (i), by striking ‘‘302(a)’’ 
and inserting ‘‘304(a)’’;
(8) 
in 
section 
4243(f)(1) 
(29 
U.S.C. 
1423(f)(1)), by striking ‘‘303(a)’’ and inserting 
‘‘302(c)’’; 
(9) 
in 
section 
4243(f)(2) 
(29 
U.S.C. 
1423(f)(2)), by striking ‘‘303(c)’’ and inserting 
‘‘302(c)(3)’’; and 
(10) in section 4243(g) (29 U.S.C. 1423(g)), by 
striking ‘‘302(c)(3)’’ and inserting ‘‘304(c)(3)’’. 
(c) AMENDMENTS TO REORGANIZATION PLAN NO. 4 
OF 1978.—Section 106(b)(ii) of Reorganization Plan No. 
4 of 1978 (ratified and affirmed as law by Public Law 
98–532 (98 Stat. 2705)) is amended by striking 
‘‘302(c)(8)’’ and inserting ‘‘302(d)(2)’’, by striking 
‘‘304(a) and (b)(2)(A)’’ and inserting ‘‘304(d)(1), (d)(2), 
and (e)(2)(A)’’, and by striking ‘‘412(c)(8), (e), and 
(f)(2)(A)’’ and inserting ‘‘412(d)(2) and 431(d)(1), (d)(2), 
and (e)(2)(A)’’. 
(d) REPEAL
OF EXPIRED AUTHORITY
FOR TEM-
PORARY VARIANCES.—
(1) IN GENERAL.—Section 207 of such Act (29 
U.S.C. 1057) is repealed. 
(2) CONFORMING AMENDMENT.—The table of 
contents in section 1 of such Act is amended by 
striking the item relating to section 207.
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning after 2006. 
Subtitle B—Amendments to 
Internal Revenue Code of 1986
SEC. 111. MINIMUM FUNDING STANDARDS. 
(a) NEW MINIMUM FUNDING STANDARDS.—Section 
412 of the Internal Revenue Code of 1986 (relating to 
minimum funding standards) is amended to read as fol-
lows: 
‘‘SEC. 412. MINIMUM FUNDING STANDARDS. 
‘‘(a) REQUIREMENT TO MEET MINIMUM FUNDING 
STANDARD.—
‘‘(1) IN GENERAL.—A plan to which this sec-
tion applies shall satisfy the minimum funding 
standard applicable to the plan for any plan year. 
‘‘(2) MINIMUM FUNDING STANDARD.—For pur-
poses of paragraph (1), a plan shall be treated as 
satisfying the minimum funding standard for a plan 
year if—
‘‘(A) in the case of a defined benefit plan 
which is not a multiemployer plan, the employer 
makes contributions to or under the plan for 
the plan year which, in the aggregate, are not 
less than the minimum required contribution
determined under section 430 for the plan for 
the plan year, 
‘‘(B) in the case of a money purchase plan 
which is not a multiemployer plan, the employer 
makes contributions to or under the plan for 
the plan year which are required under the 
terms of the plan, and 
‘‘(C) in the case of a multiemployer plan, 
the employers make contributions to or under 
the plan for any plan year which, in the aggre-
gate, are sufficient to ensure that the plan does 
not have an accumulated funding deficiency 
under section 431 as of the end of the plan 
year. 
‘‘(b) LIABILITY FOR CONTRIBUTIONS.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), the amount of any contribution required 
by this section (including any required installments 
under paragraphs (3) and (4) of section 430(j)) 
shall be paid by the employer responsible for making 
contributions to or under the plan. 
‘‘(2) JOINT
AND
SEVERAL
LIABILITY
WHERE 
EMPLOYER MEMBER OF CONTROLLED GROUP.—In 
the case of a defined benefit plan which is not a 
multiemployer plan, if the employer referred to in
paragraph (1) is a member of a controlled group, 
each member of such group shall be jointly and sev-
erally liable for payment of such contributions. 
‘‘(c) VARIANCE FROM MINIMUM FUNDING STAND-
ARDS.—
‘‘(1) WAIVER
IN
CASE
OF
BUSINESS
HARD-
SHIP.—
‘‘(A) IN GENERAL.—If—
‘‘(i) an employer is (or in the case of 
a multiemployer plan, 10 percent or more 
of the number of employers contributing to 
or under the plan is) unable to satisfy the 
minimum funding standard for a plan year 
without temporary substantial business 
hardship (substantial business hardship in 
the case of a multiemployer plan), and 
‘‘(ii) application of the standard would 
be adverse to the interests of plan partici-
pants in the aggregate, 
the Secretary may, subject to subparagraph 
(C), waive the requirements of subsection (a) 
for such year with respect to all or any portion 
of the minimum funding standard. The Sec-
retary shall not waive the minimum funding 
standard with respect to a plan for more than
3 of any 15 (5 of any 15 in the case of a multi-
employer plan) consecutive plan years. 
‘‘(B) EFFECTS OF WAIVER.—If a waiver is 
granted under subparagraph (A) for any plan 
year—
‘‘(i) in the case of a defined benefit 
plan which is not a multiemployer plan, 
the minimum required contribution under 
section 430 for the plan year shall be re-
duced by the amount of the waived funding 
deficiency and such amount shall be amor-
tized as required under section 430(e), and 
‘‘(ii) in the case of a multiemployer 
plan, the funding standard account shall 
be credited under section 431(b)(3)(C) 
with the amount of the waived funding de-
ficiency and such amount shall be amor-
tized 
as 
required 
under 
section 
431(b)(2)(C). 
‘‘(C) WAIVER
OF
AMORTIZED
PORTION 
NOT ALLOWED.—The Secretary may not waive 
under subparagraph (A) any portion of the 
minimum funding standard under subsection 
(a) for a plan year which is attributable to any
waived funding deficiency for any preceding 
plan year. 
‘‘(2) DETERMINATION
OF
BUSINESS
HARD-
SHIP.—For purposes of this subsection, the factors 
taken into account in determining temporary sub-
stantial business hardship (substantial business 
hardship in the case of a multiemployer plan) shall 
include (but shall not be limited to) whether or 
not—
‘‘(A) the employer is operating at an eco-
nomic loss, 
‘‘(B) there is substantial unemployment or 
underemployment in the trade or business and 
in the industry concerned, 
‘‘(C) the sales and profits of the industry 
concerned are depressed or declining, and 
‘‘(D) it is reasonable to expect that the 
plan will be continued only if the waiver is 
granted. 
‘‘(3) WAIVED FUNDING DEFICIENCY.—For pur-
poses of this section and part III of this subchapter, 
the term ‘waived funding deficiency’ means the por-
tion of the minimum funding standard under sub-
section (a) (determined without regard to the waiv-
er) for a plan year waived by the Secretary and not 
satisfied by employer contributions. 
‘‘(4) SECURITY FOR WAIVERS FOR SINGLE-EM-
PLOYER PLANS, CONSULTATIONS.—
‘‘(A) SECURITY MAY BE REQUIRED.—
‘‘(i) IN
GENERAL.—Except as pro-
vided in subparagraph (C), the Secretary 
may require an employer maintaining a de-
fined benefit plan which is a single-em-
ployer plan (within the meaning of section 
4001(a)(15) of the Employee Retirement 
Income Security Act of 1974) to provide 
security to such plan as a condition for 
granting or modifying a waiver under 
paragraph (1). 
‘‘(ii) SPECIAL
RULES.—Any security 
provided under clause (i) may be perfected 
and enforced only by the Pension Benefit 
Guaranty Corporation, or at the direction 
of the Corporation, by a contributing spon-
sor 
(within 
the 
meaning 
of 
section 
4001(a)(13) of the Employee Retirement 
Income Security Act of 1974), or a mem-
ber of such sponsor’s controlled group
(within the meaning of section 4001(a)(14) 
of such Act). 
‘‘(B) CONSULTATION WITH THE PENSION 
BENEFIT GUARANTY CORPORATION.—Except as 
provided in subparagraph (C), the Secretary 
shall, before granting or modifying a waiver 
under this subsection with respect to a plan de-
scribed in subparagraph (A)(i)—
‘‘(i) provide the Pension Benefit 
Guaranty Corporation with—
‘‘(I) notice of the completed ap-
plication for any waiver or modifica-
tion, and 
‘‘(II) an opportunity to comment 
on such application within 30 days 
after receipt of such notice, and 
‘‘(ii) consider—
‘‘(I) any comments of the Cor-
poration under clause (i)(II), and 
‘‘(II) any views of any employee 
organization (within the meaning of 
section 3(4) of the Employee Retire-
ment Income Security Act of 1974) 
representing participants in the plan 
which are submitted in writing to the
Secretary in connection with such ap-
plication. 
Information provided to the Corporation under 
this subparagraph shall be considered tax re-
turn information and subject to the safe-
guarding and reporting requirements of section 
6103(p). 
‘‘(C) EXCEPTION
FOR
CERTAIN
WAIV-
ERS.—
‘‘(i) IN
GENERAL.—The preceding 
provisions of this paragraph shall not 
apply to any plan with respect to which the 
sum of—
‘‘(I) the aggregate unpaid min-
imum required contribution (within 
the meaning of section 4971(c)(4)) for 
the plan year and all preceding plan 
years, and 
‘‘(II) the present value of all 
waiver amortization installments de-
termined for the plan year and suc-
ceeding plan years under section 
430(e)(2), 
is less than $1,000,000.
‘‘(ii) TREATMENT
OF
WAIVERS
FOR 
WHICH APPLICATIONS ARE PENDING.—The 
amount described in clause (i)(I) shall in-
clude any increase in such amount which 
would result if all applications for waivers 
of the minimum funding standard under 
this subsection which are pending with re-
spect to such plan were denied. 
‘‘(5) SPECIAL
RULES
FOR
SINGLE-EMPLOYER 
PLANS.—
‘‘(A) APPLICATION MUST BE SUBMITTED 
BEFORE DATE 21⁄2 MONTHS AFTER CLOSE OF 
YEAR.—In the case of a defined benefit plan 
which is not a multiemployer plan, no waiver 
may be granted under this subsection with re-
spect to any plan for any plan year unless an 
application therefor is submitted to the Sec-
retary not later than the 15th day of the 3rd 
month beginning after the close of such plan 
year. 
‘‘(B) SPECIAL RULE IF EMPLOYER IS MEM-
BER OF CONTROLLED GROUP.—In the case of a 
defined benefit plan which is not a multiem-
ployer plan, if an employer is a member of a 
controlled group, the temporary substantial
business hardship requirements of paragraph 
(1) shall be treated as met only if such require-
ments are met—
‘‘(i) with respect to such employer, 
and 
‘‘(ii) with respect to the controlled 
group of which such employer is a member 
(determined by treating all members of 
such group as a single employer). 
The Secretary may provide that an analysis of 
a trade or business or industry of a member 
need not be conducted if the Secretary deter-
mines such analysis is not necessary because 
the taking into account of such member would 
not significantly affect the determination under 
this paragraph. 
‘‘(6) ADVANCE NOTICE.—
‘‘(A) IN GENERAL.—The Secretary shall, 
before granting a waiver under this subsection, 
require each applicant to provide evidence satis-
factory to the Secretary that the applicant has 
provided notice of the filing of the application 
for such waiver to each affected party (as de-
fined in section 4001(a)(21) of the Employee 
Retirement Income Security Act of 1974). Such
notice shall include a description of the extent 
to which the plan is funded for benefits which 
are guaranteed under title IV of the Employee 
Retirement Income Security Act of 1974 and 
for benefit liabilities. 
‘‘(B) CONSIDERATION
OF
RELEVANT
IN-
FORMATION.—The Secretary shall consider any 
relevant information provided by a person to 
whom notice was given under subparagraph 
(A). 
‘‘(7) RESTRICTION ON PLAN AMENDMENTS.—
‘‘(A) IN GENERAL.—No amendment of a 
plan which increases the liabilities of the plan 
by reason of any increase in benefits, any 
change in the accrual of benefits, or any change 
in the rate at which benefits become nonforfeit-
able under the plan shall be adopted if a waiver 
under this subsection or an extension of time 
under section 431(d) is in effect with respect to 
the plan, or if a plan amendment described in 
subsection (d)(2) has been made at any time in 
the preceding 12 months (24 months in the 
case of a multiemployer plan). If a plan is 
amended in violation of the preceding sentence, 
any such waiver, or extension of time, shall not
apply to any plan year ending on or after the 
date on which such amendment is adopted. 
‘‘(B) EXCEPTION.—Paragraph (1) shall 
not apply to any plan amendment which—
‘‘(i) the Secretary determines to be 
reasonable and which provides for only de 
minimis increases in the liabilities of the 
plan, 
‘‘(ii) only repeals an amendment de-
scribed in subsection (d)(2), or 
‘‘(iii) is required as a condition of 
qualification under part I of subchapter D, 
of chapter 1. 
‘‘(d) MISCELLANEOUS RULES.—
‘‘(1) CHANGE
IN
METHOD
OR
YEAR.—If the 
funding method, the valuation date, or a plan year 
for a plan is changed, the change shall take effect 
only if approved by the Secretary. 
‘‘(2) CERTAIN
RETROACTIVE
PLAN
AMEND-
MENTS.—For purposes of this section, any amend-
ment applying to a plan year which—
‘‘(A) is adopted after the close of such plan 
year but no later than 21⁄2 months after the 
close of the plan year (or, in the case of a mul-
100
tiemployer plan, no later than 2 years after the 
close of such plan year), 
‘‘(B) does not reduce the accrued benefit 
of any participant determined as of the begin-
ning of the first plan year to which the amend-
ment applies, and 
‘‘(C) does not reduce the accrued benefit of 
any participant determined as of the time of 
adoption except to the extent required by the 
circumstances, 
shall, at the election of the plan administrator, be 
deemed to have been made on the first day of such 
plan year. No amendment described in this para-
graph which reduces the accrued benefits of any par-
ticipant shall take effect unless the plan adminis-
trator files a notice with the Secretary notifying him 
of such amendment and the Secretary has approved 
such amendment, or within 90 days after the date 
on which such notice was filed, failed to disapprove 
such amendment. No amendment described in this 
subsection shall be approved by the Secretary unless 
the Secretary determines that such amendment is 
necessary because of a substantial business hardship 
(as determined under subsection (c)(2)) and that a 
waiver under subsection (c) (or, in the case of a
101
multiemployer plan, any extension of the amortiza-
tion period under section 431(d)) is unavailable or 
inadequate. 
‘‘(3) CONTROLLED
GROUP.—For purposes of 
this section, the term ‘controlled group’ means any 
group treated as a single employer under subsection 
(b), (c), (m), or (o) of section 414. 
‘‘(e) PLANS TO WHICH SECTION APPLIES.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), this section applies to a plan if, for any 
plan year beginning after December 31, 2006—
‘‘(A) such plan included a trust which 
qualified (or was determined by the Secretary 
to have qualified) under section 401(a), or 
‘‘(B) such plan satisfied (or was deter-
mined by the Secretary to have satisfied) the 
requirements of section 403(a). 
‘‘(2) EXCEPTIONS.—This section shall not 
apply to—
‘‘(A) any profit-sharing or stock bonus 
plan, 
‘‘(B) any insurance contract plan described 
in paragraph (3), 
‘‘(C) any governmental plan (within the 
meaning of section 414(d)),
102
‘‘(D) any church plan (within the meaning 
of section 414(e)) with respect to which the 
election provided by section 410(d) has not been 
made, 
‘‘(E) any plan which has not, at any time 
after September 2, 1974, provided for employer 
contributions, or 
‘‘(F) any plan established and maintained 
by a society, order, or association described in 
section 501(c)(8) or (9), if no part of the con-
tributions to or under such plan are made by 
employers of participants in such plan. 
No plan described in subparagraph (C), (D), or (F) 
shall be treated as a qualified plan for purposes of 
section 401(a) unless such plan meets the require-
ments of section 401(a)(7) as in effect on September 
1, 1974. 
‘‘(3) CERTAIN INSURANCE CONTRACT PLANS.—
A plan is described in this paragraph if—
‘‘(A) the plan is funded exclusively by the 
purchase of individual insurance contracts, 
‘‘(B) such contracts provide for level an-
nual premium payments to be paid extending 
not later than the retirement age for each indi-
vidual participating in the plan, and com-
103
mencing with the date the individual became a 
participant in the plan (or, in the case of an in-
crease in benefits, commencing at the time such 
increase becomes effective), 
‘‘(C) benefits provided by the plan are 
equal to the benefits provided under each con-
tract at normal retirement age under the plan 
and are guaranteed by an insurance carrier (li-
censed under the laws of a State to do business 
with the plan) to the extent premiums have 
been paid, 
‘‘(D) premiums payable for the plan year, 
and all prior plan years, under such contracts 
have been paid before lapse or there is rein-
statement of the policy, 
‘‘(E) no rights under such contracts have 
been subject to a security interest at any time 
during the plan year, and 
‘‘(F) no policy loans are outstanding at 
any time during the plan year. 
A plan funded exclusively by the purchase of group 
insurance contracts which is determined under regu-
lations prescribed by the Secretary to have the same 
characteristics as contracts described in the pre-
104
ceding sentence shall be treated as a plan described 
in this paragraph.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning after De-
cember 31, 2006. 
SEC. 112. FUNDING RULES FOR SINGLE-EMPLOYER DE-
FINED BENEFIT PENSION PLANS. 
(a) IN GENERAL.—Subchapter D of chapter 1 of the 
Internal Revenue Code of 1986 (relating to deferred com-
pensation, etc.) is amended by adding at the end the fol-
lowing new part: 
‘‘PART III—MINIMUM FUNDING STANDARDS FOR 
SINGLE-EMPLOYER DEFINED BENEFIT PEN-
SION PLANS 
‘‘SEC. 430. MINIMUM FUNDING STANDARDS FOR SINGLE-
EMPLOYER 
DEFINED 
BENEFIT 
PENSION 
PLANS. 
‘‘(a) MINIMUM
REQUIRED
CONTRIBUTION.—For 
purposes of this section and section 412(a)(2)(A), except 
as provided in subsection (f), the term ‘minimum required 
contribution’ means, with respect to any plan year of a 
defined benefit plan which is not a multiemployer plan—
‘‘(1) in any case in which the value of plan as-
sets of the plan (as reduced under subsection