vidual custodial account in kind to a participant or bene-
ficiary of the plan and the distributed custodial account 
shall be maintained by the custodian on a tax-deferred 
basis as a section 403(b)(7) custodial account, similar to 
the treatment of fully-paid individual annuity contracts 
under Revenue Ruling 2011–7, until amounts are actually 
paid to the participant or beneficiary. The guidance shall 
provide further (i) that the section 403(b)(7) status of the 
distributed custodial account is generally maintained if the 
custodial account thereafter adheres to the requirements 
of section 403(b) that are in effect at the time of the dis-
tribution of the account and (ii) that a custodial account 
would not be considered distributed to the participant or 
beneficiary if the employer has any material retained 
rights under the account (but the employer would not be 
treated as retaining material rights simply because the 
custodial account was originally opened under a group 
contract). 
SEC. 108. CLARIFICATION OF RETIREMENT INCOME AC-
COUNT RULES RELATING TO CHURCH-CON-
TROLLED ORGANIZATIONS. 
(a) IN GENERAL.—Section 403(b)(9)(B) is amended 
by inserting ‘‘(including an employee described in section 
414(e)(3)(B))’’ after ‘‘employee described in paragraph 
(1)’’. 
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(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to years beginning before, on, or 
after the date of the enactment of this Act. 
SEC. 109. INCREASE IN 10 PERCENT CAP FOR AUTOMATIC 
ENROLLMENT 
SAFE 
HARBOR 
AFTER 
1ST 
PLAN YEAR. 
(a) IN
GENERAL.—Section 401(k)(13)(C)(iii) is 
amended by striking ‘‘does not exceed 10 percent’’ and 
inserting ‘‘does not exceed 15 percent (10 percent during 
the period described in subclause (I))’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning after De-
cember 31, 2019. 
SEC. 110. INCREASE IN CREDIT LIMITATION FOR SMALL 
EMPLOYER PENSION PLAN STARTUP COSTS. 
(a) IN GENERAL.—Paragraph (1) of section 45E(b) 
is amended to read as follows: 
‘‘(1) for the first credit year and each of the 2 
taxable years immediately following the first credit 
year, the greater of— 
‘‘(A) $500, or 
‘‘(B) the lesser of— 
‘‘(i) $250 for each employee of the eli-
gible employer who is not a highly com-
pensated employee (as defined in section 
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414(q)) and who is eligible to participate 
in the eligible employer plan maintained by 
the eligible employer, or 
‘‘(ii) $1,500, and’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2019. 
SEC. 111. SMALL EMPLOYER AUTOMATIC ENROLLMENT 
CREDIT. 
(a) IN GENERAL.—Section 45E is amended by add-
ing at the end the following new subsection: 
‘‘(f) CREDIT FOR AUTO-ENROLLMENT OPTION FOR 
RETIREMENT SAVINGS OPTIONS.— 
‘‘(1) IN GENERAL.—The credit allowed under 
subsection (a) for any taxable year during an eligible 
employer’s retirement auto-enrollment credit period 
shall be increased (without regard to subsection (b)) 
by $500. 
‘‘(2) RETIREMENT AUTO-ENROLLMENT CREDIT 
PERIOD.— 
‘‘(A) IN GENERAL.—The retirement auto- 
enrollment credit period with respect to any eli-
gible employer is the 3-taxable-year period be-
ginning with the first taxable year for which the 
employer includes an eligible automatic con-
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tribution arrangement (as defined in section 
414(w)(3)) in a qualified employer plan (as de-
fined in section 4972(d)) sponsored by the em-
ployer. 
‘‘(B) MAINTENANCE OF ARRANGEMENT.— 
No taxable year with respect to an employer 
shall be treated as occurring within the retire-
ment auto-enrollment credit period unless the 
arrangement described in subparagraph (A) is 
included in the plan for such year. 
‘‘(3) NOT LIMITED TO NEW PLANS.—This sub-
section shall be applied without regard to subsection 
(c)(2).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2019. 
SEC. 112. EXEMPTION FROM REQUIRED MINIMUM DIS-
TRIBUTION RULES FOR INDIVIDUALS WITH 
CERTAIN ACCOUNT BALANCES. 
(a) IN GENERAL.—Section 401(a)(9) is amended by 
adding at the end the following new subparagraph: 
‘‘(H) EXCEPTION
FROM
REQUIRED
MIN-
IMUM
DISTRIBUTIONS
DURING
LIFE
OF
EM-
PLOYEE
WHERE
ASSETS
DO
NOT
EXCEED 
$50,000.— 
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‘‘(i) IN GENERAL.—If on the last day 
of any calendar year the aggregate value of 
an employee’s entire interest under all ap-
plicable eligible retirement plans does not 
exceed $50,000, then the requirements of 
subparagraph (A) with respect to any dis-
tribution relating to such year shall not 
apply with respect to such employee. 
‘‘(ii) APPLICABLE ELIGIBLE RETIRE-
MENT PLAN.—For purposes of this sub-
paragraph, the term ‘applicable eligible re-
tirement plan’ means an eligible retirement 
plan (as defined in section 402(c)(8)(B)) 
other than a defined benefit plan. 
‘‘(iii) LIMIT ON REQUIRED MINIMUM 
DISTRIBUTION.—The required minimum 
distribution determined under subpara-
graph (A) for an employee under all appli-
cable eligible retirement plans shall not ex-
ceed an amount equal to the excess of— 
‘‘(I) the aggregate value of an 
employee’s entire interest under such 
plans on the last day of the calendar 
year to which such distribution re-
lates, over 
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