‘‘(E) ROLLOVERS
TO
LIFETIME
SAVINGS 
ACCOUNTS.—
‘‘(i) IN GENERAL.—Subparagraph (A) 
shall not apply to the qualified portion of 
any distribution which, before January 1, 
2007, and within 60 days of such distribu-
tion, is transferred to a Lifetime Savings 
Account (within the meaning of section 
530A) of the designated beneficiary. This 
subparagraph shall only apply to distribu-
tions in accordance with the previous sen-
tence from an account which was in exist-
ence with respect to such designated bene-
ficiary on December 31, 2004. 
‘‘(ii) QUALIFIED PORTION.—For pur-
poses of this subparagraph, the term 
‘qualified portion’ means the amount equal 
to the sum of—
‘‘(I) the lesser of $50,000 or the 
amount which is in the account of the 
designated beneficiary on December 
31, 2004, 
‘‘(II) any contributions to such 
account for the taxable year beginning
after December 31, 2004, and before 
January 1, 2006, and 
‘‘(III) any earnings of such ac-
count for such year. 
‘‘(iii) LIMITATION.—The sum of the 
amounts taken into account under clause 
(ii)(II) with respect to all accounts of the 
designated beneficiary plus any amounts 
with respect to such designated beneficiary 
taken 
into 
account 
under 
section 
530(d)(9)(B)(ii) shall not exceed the sum 
of $5,000 plus the earnings attributable to 
such amounts.’’. 
(2) COVERDELL
EDUCATION
SAVINGS
AC-
COUNTS.—Subsection (d) of section 530 of such 
Code (relating to tax treatment of distributions) is 
amended by inserting at the end the following new 
paragraph: 
‘‘(9) ROLLOVERS
TO
LIFETIME
SAVINGS
AC-
COUNTS.—
‘‘(A) IN
GENERAL.—Paragraph (1) shall 
not apply to the qualified portion of any 
amount paid or distributed from a Coverdell 
education savings account to the extent that the 
amount received is paid, before January 1,
2007, and not later than the 60th day after the 
date of such payment or distribution, into a 
Lifetime Savings Account (within the meaning 
of section 530A) for the benefit of the same 
beneficiary. This paragraph shall only apply to 
amounts paid or distributed in accordance with 
the preceding sentence from an account which 
was in existence with respect to such bene-
ficiary on December 31, 2004. 
‘‘(B) QUALIFIED PORTION.—For purposes 
of this paragraph, the term ‘qualified portion’ 
means the amount equal to the sum of—
‘‘(i) the amount which is in the ac-
count of the beneficiary on December 31, 
2004, 
‘‘(ii) any contributions to such ac-
count for the taxable year beginning after 
December 31, 2004, and before January 1, 
2006 and 
‘‘(iii) any earnings of such account for 
such year. 
‘‘(C) 
LIMITATION.—The 
sum 
of 
the 
amounts taken into account under subpara-
graph (B)(ii) with respect to all accounts of the 
beneficiary plus any amounts with respect to
such beneficiary taken into account under sec-
tion 529(c)(3)(E)(ii)(II) shall not exceed the 
sum of $5,000 plus the earnings attributable to 
such amounts.’’. 
(e) CONFORMING AMENDMENT.—The table of parts 
for subchapter F of chapter 1 of the Internal Revenue 
Code of 1986 is amended by adding at the end the fol-
lowing new item:
‘‘PART IX. LIFETIME SAVINGS ACCOUNTS’’.
(f) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2005.
Æ