account manager of such managed account 
investment, 
‘‘(ii) the term ‘lifetime income invest-
ment’ means an investment option that is 
designed to provide an employee with elec-
tion rights— 
‘‘(I) that are not uniformly avail-
able with respect to other investment 
options under the plan, and 
‘‘(II) that are to a lifetime in-
come feature available through a con-
tract or other arrangement offered 
under the plan or under another eligi-
ble retirement plan (as defined in sec-
tion 402(c)(8)(B)) through a direct 
trustee-to-trustee transfer to such 
other eligible retirement plan under 
section 401(a)(31)(A), 
‘‘(iii) the term ‘lifetime income fea-
ture’ means— 
‘‘(I) a feature that guarantees a 
minimum level of income annually (or 
more frequently) for at least the re-
mainder of the life of the employee or 
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the joint lives of the employee and the 
employee’s designated beneficiary, or 
‘‘(II) an annuity payable on be-
half of the employee under which pay-
ments are made in substantially equal 
periodic payments (not less frequently 
than annually) over the life of the em-
ployee or the joint lives of the em-
ployee and the employee’s designated 
beneficiary, 
‘‘(iv) the term ‘qualified plan distribu-
tion annuity contract’ means an annuity 
contract purchased for a participant and 
distributed to the participant by a plan de-
scribed in subparagraph (B) of section 
402(c)(8) (without regard to clauses (i) 
and (ii) thereof), 
‘‘(v) the term ‘managed account in-
vestment’ means an investment option 
under which the assets of the employee’s 
individual account are managed by an ac-
count manager, applying generally accept-
ed investment theories, to achieve varying 
degrees of long-term appreciation and cap-
ital preservation based on the employee’s 
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age, target retirement date or life expect-
ancy, 
‘‘(vi) the term ‘account manager’ 
means an investment manager (within the 
meaning of section 3(38) of the Employee 
Retirement Income Security Act), and 
‘‘(vii) a lifetime income investment or 
managed account investment is treated as 
no longer authorized to be held as an in-
vestment under the plan if such treatment 
applies to all plan participants or to a class 
of such participants, as determined in any 
reasonable manner.’’. 
(b) CASH OR DEFERRED ARRANGEMENT.—Clause (i) 
of section 401(k)(2)(B) of such Code is amended by strik-
ing ‘‘or’’ at the end of subclause (IV), by striking ‘‘and’’ 
at the end of subclause (V) and inserting ‘‘or’’, and by 
adding at the end of clause (i) the following: 
‘‘(VI) with respect to amounts in-
vested in a lifetime income investment 
(as 
defined 
in 
section 
401(a)(38)(B)(ii)) or a managed ac-
count investment (as defined in sec-
tion 401(a)(38)(B)(v)), the date that 
is 90 days prior to the date that such 
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lifetime income investment or such 
managed account investment may no 
longer be held as an investment option 
under the plan (within the meaning of 
section 401(a)(38)(B)(vii)), provided 
that any distribution under this sub-
clause must be in the form of a quali-
fied distribution (as defined in section 
401(a)(38)(B)(i)) or, in the case of a 
lifetime income investment, a qualified 
plan distribution annuity contract (as 
defined in section 401(a)(38)(B)(iv)), 
and’’. 
(c) SECTION 403(b) PLANS.— 
(1) ANNUITY CONTRACTS.—Paragraph (11) of 
section 403(b) of such Code is amended by striking 
‘‘or’’ at the end of subparagraph (B), by striking the 
period at the end of subparagraph (C), and by in-
serting ‘‘, or’’, and by adding at the end the fol-
lowing: 
‘‘(D) with respect to amounts invested in a 
lifetime income investment (as defined in sec-
tion 401(a)(38)(B)(ii)) or a managed account 
investment 
(as 
defined 
in 
section 
401(a)(38)(B)(v)), the date that is 90 days 
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prior to the date that such lifetime income in-
vestment or such managed account investment 
may no longer be held as an investment option 
under the plan (within the meaning of section 
401(a)(38)(B)(vii)), provided that any distribu-
tion under this subparagraph must be in the 
form of a qualified distribution (as defined in 
section 401(a)(38)(B)(i)) or, in the case of a 
lifetime income investment, a qualified plan dis-
tribution annuity contract (as defined in section 
401(a)(38)(B)(iv)).’’. 
(2) CUSTODIAL ACCOUNTS.—Clause (ii) of sec-
tion 403(b)(7)(A) of such Code is amended to read 
as follows: 
‘‘(ii) under the custodial account, no 
such amounts may be paid or made avail-
able to any distributee (unless such 
amount is a distribution to which section 
72(t)(2)(G) applies) before— 
‘‘(I) the employee dies, 
‘‘(II) the employee attains age 
591⁄2, 
‘‘(III) the employee has a sever-
ance from employment, 
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‘‘(IV) the employee becomes dis-
abled (within the meaning of section 
72(m)(7)), 
‘‘(V) in the case of contributions 
made pursuant to a salary reduction 
agreement (within the meaning of sec-
tion 3121(a)(5)(D)), the employee en-
counters financial hardship, or 
‘‘(VI) with respect to amounts in-
vested in a lifetime income investment 
(as 
defined 
in 
section 
401(a)(38)(B)(ii)) or a managed ac-
count investment (as defined in sec-
tion 401(a)(38)(B)(v)), the date that 
is 90 days prior to the date that such 
lifetime income investment or such 
managed account investment may no 
longer be held as an investment option 
under the plan (within the meaning of 
section 401(a)(38)(B)(vii)), provided 
that any distribution under this sub-
paragraph must be in the form of a 
qualified distribution (as defined in 
section 401(a)(38)(B)(i)) or, in the 
case of a lifetime income investment, 
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a qualified plan distribution annuity 
contract 
(as 
defined 
in 
section 
401(a)(38)(B)(iv)).’’. 
(d) ELIGIBLE DEFERRED COMPENSATION PLANS.— 
Subparagraph (A) of section 457(d)(1) of such Code is 
amended by striking ‘‘or’’ at the end of clause (ii), by in-
serting ‘‘or’’ at the end of clause (iii), and by adding after 
clause (iii) the following: 
‘‘(iv) with respect to amounts invested 
in a lifetime income investment (as defined 
in section 401(a)(38)(B)(ii)) or a managed 
account investment (as defined in section 
401(a)(38)(B)(v)), the date that is 90 days 
prior to the date that such lifetime income 
investment or such managed account in-
vestment may no longer be held as an in-
vestment option under the plan (within the 
meaning of section 401(a)(38)(B)(vii)), 
provided that any distribution under this 
subparagraph must be in the form of a 
qualified distribution (as defined in section 
401(a)(38)(B)(i)) or, in the case of a life-
time income investment, a qualified plan 
distribution annuity contract (as defined in 
section 401(a)(38)(B)(iv)),’’. 
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