2103 
† HR 2617 EAS2 
‘‘(4) Any State that receives information described in 
paragraph (1)(A) with respect to an applicable savings 
bond may use such information to locate the owner of such 
bond pursuant to the same standards and requirements as 
are applicable under— 
‘‘(A) the abandoned property rules and regula-
tions of such State; and 
‘‘(B) any regulations or guidance promulgated 
under this subsection. 
‘‘(5) For purposes of this subsection, the Secretary may 
disclose to the public any information with respect to any 
applicable savings bond which a State may disclose to the 
public pursuant to paragraph (4). 
‘‘(6) For purposes of this subsection, the term ‘applica-
ble savings bond’ means a savings bond which— 
‘‘(A) is more than 3 years past its date of final 
maturity; 
‘‘(B)(i) is in paper form; or 
‘‘(ii) is in paperless or electronic form and for 
which— 
‘‘(I) there is no designated bank account or 
routing information; or 
‘‘(II) the designated bank account or rout-
ing information is incorrect; and 
‘‘(C) has not been redeemed.’’.
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† HR 2617 EAS2 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall take effect on the date of enactment of this Act. 
SEC. 123. CERTAIN SECURITIES TREATED AS PUBLICLY 
TRADED IN CASE OF EMPLOYEE STOCK OWN-
ERSHIP PLANS. 
(a) IN GENERAL.—Section 401(a)(35) is amended by 
adding at the end the following new subparagraph: 
‘‘(I) ESOP RULES RELATING TO PUBLICLY 
TRADED SECURITIES.—In the case of an applica-
ble defined contribution plan which is an em-
ployee stock ownership plan, an employer secu-
rity shall be treated as described in subpara-
graph (G)(v) if— 
‘‘(i) the security is the subject of priced 
quotations by at least 4 dealers, published 
and made continuously available on an 
interdealer quotation system (as such term 
is used in section 13 of the Securities Ex-
change Act of 1934) which has made the re-
quest described in section 6(j) of such Act to 
be treated as an alternative trading system, 
‘‘(ii) the security is not a penny stock 
(as defined by section 3(a)(51) of such Act), 
‘‘(iii) the security is issued by a cor-
poration which is not a shell company (as
2105 
† HR 2617 EAS2 
such term is used in section 4(d)(6) of the 
Securities Act of 1933), a blank check com-
pany (as defined in section 7(b)(3) of such 
Act), or subject to bankruptcy proceedings, 
‘‘(iv) the security has a public float (as 
such term is used in section 240.12b-2 of 
title 17, Code of Federal Regulations) which 
has a fair market value of at least 
$1,000,000 and constitutes at least 10 per-
cent of the total shares issued and out-
standing. 
‘‘(v) in the case of a security issued by 
a domestic corporation, the issuer publishes, 
not less frequently than annually, financial 
statements audited by an independent audi-
tor registered with the Public Company Ac-
counting Oversight Board established under 
the Sarbanes-Oxley Act of 2002, and 
‘‘(vi) in the case of a security issued by 
a foreign corporation, the security is rep-
resented by a depositary share (as defined 
under section 240.12b-2 of title 17, Code of 
Federal Regulations), or is issued by a for-
eign corporation incorporated in Canada
2106 
† HR 2617 EAS2 
and readily tradeable on an established se-
curities market in Canada, and the issuer— 
‘‘(I) is subject to, and in compli-
ance with, the reporting requirements 
of section 13 or 15(d) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78m 
or 78o(d)), 
‘‘(II) is subject to, and in compli-
ance with, the reporting requirements 
of section 230.257 of title 17, Code of 
Federal Regulations, or 
‘‘(III) is exempt from such re-
quirements under section 240.12g3– 
2(b) of title 17, Code of Federal Regu-
lations.’’. 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall apply to plan years beginning after December 
31, 2027. 
SEC. 124. MODIFICATION OF AGE REQUIREMENT FOR 
QUALIFIED ABLE PROGRAMS. 
(a) IN GENERAL.—Section 529A(e) is amended by 
striking ‘‘age 26’’ each place it appears in paragraphs 
(1)(A) and (2)(A)(i)(II) and inserting ‘‘age 46’’.
2107 
† HR 2617 EAS2 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after Decem-
ber 31, 2025. 
SEC. 125. IMPROVING COVERAGE FOR PART-TIME WORK-
ERS. 
(a) IN GENERAL.— 
(1) EMPLOYEE RETIREMENT INCOME SECURITY 
ACT OF 1974.—Section 202 of the Employee Retire-
ment Income Security Act of 1974 (29 U.S.C. 1052) 
is amended by adding at the end the following new 
subsection: 
‘‘(c) SPECIAL RULE FOR CERTAIN PART-TIME EM-
PLOYEES.— 
‘‘(1) IN GENERAL.—A pension plan that includes 
either a qualified cash or deferred arrangement (as 
defined in section 401(k) of the Internal Revenue 
Code of 1986) or a salary reduction agreement (as de-
scribed in section 403(b) of such Code) shall not re-
quire, as a condition of participation in the arrange-
ment or agreement, that an employee complete a pe-
riod of service with the employer (or employers) 
maintaining the plan extending beyond the close of 
the earlier of—
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† HR 2617 EAS2 
‘‘(A) the period permitted under subsection 
(a)(1) (determined without regard to subpara-
graph (B)(i) thereof); or 
‘‘(B) the first 24-month period— 
‘‘(i) consisting of 2 consecutive 12- 
month periods during each of which the em-
ployee has at least 500 hours of service; and 
‘‘(ii) by the close of which the employee 
has met the requirement of subsection 
(a)(1)(A)(i). 
‘‘(2) EXCEPTION.—Paragraph (1)(B) shall not 
apply to any employee described in section 410(b)(3) 
of the Internal Revenue Code of 1986. 
‘‘(3) COORDINATION WITH TIME OF PARTICIPA-
TION RULES.—In the case of employees who are eligi-
ble to participate in the arrangement or agreement 
solely by reason of paragraph (1)(B), or by reason of 
such paragraph and section 401(k)(2)(D)(ii) of such 
Code, the rules of subsection (a)(4) shall apply to such 
employees. 
‘‘(4) 12-MONTH PERIOD.—For purposes of this 
subsection, 12-month periods shall be determined in 
the same manner as under the last sentence of sub-
section (a)(3)(A), except that 12-month periods begin-
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† HR 2617 EAS2 
(B) CONFORMING AMENDMENT.— 
(i) 
The 
last 
sentence 
of 
section 
403(b)(12)(A), as amended by this Act, is 
further amended by inserting ‘‘and section 
202(c) of the Employee Retirement Income 
Security Act of 1974’’ after ‘‘under section 
410(b)(4)’’. 
(ii) Section 401(k)(15)(B)(i) is amend-
ed by inserting ‘‘, or by reason of such 
paragraph and section 202(c)(1)(B) of the 
Employee Retirement Income Security Act 
of 1974’’ after ‘‘paragraph (2)(D)(ii)’’. 
(b) VESTING.—Section 203(b) of the Employee Retire-
ment Income Security Act of 1974 (29 U.S.C. 1053(b)) is 
amended by redesignating paragraph (4) as paragraph (5) 
and by inserting after paragraph (3) the following new 
paragraph: 
‘‘(4) PART-TIME EMPLOYEES.—For purposes of 
determining whether an employee who became eligible 
to participate in a qualified cash or deferred arrange-
ment or a salary reduction agreement under a plan 
solely by reason of section 202(c)(1)(B) has a non-
forfeitable right to employer contributions— 
‘‘(A) except as provided in subparagraph 
(B), each 12-month period for which the em-
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† HR 2617 EAS2 
ployee has at least 500 hours of service shall be 
treated as a year of service; and 
‘‘(B) paragraph (3) shall be applied by sub-
stituting ‘at least 500 hours of service’ for ‘more 
than 500 hours of service’ in subparagraph (A) 
thereof. 
For purposes of this paragraph, 12-month periods 
shall be determined in the same manner as under the 
last sentence of section 202(a)(3)(A), except that 12- 
month periods beginning before January 1, 2023, 
shall not be taken into account.’’. 
(c) REDUCTION IN PERIOD SERVICE REQUIREMENT 
FOR QUALIFIED CASH AND DEFERRED ARRANGEMENTS.— 
Section 401(k)(2)(D)(ii) is amended by striking ‘‘3’’ and 
inserting ‘‘2’’. 
(d) PRE-2021 SERVICE.—Section 112(b) of the Setting 
Every Community Up for Retirement Enhancement Act of 
2019 (26 U.S.C. 401 note) is amended by striking ‘‘section 
401(k)(2)(D)(ii)’’ and inserting ‘‘paragraphs (2)(D)(ii) 
and (15)(B)(iii) of section 401(k)’’. 
(e) COORDINATION WITH RULES
FOR TOP-HEAVY 
PLANS.—Subparagraph (H) of section 416(g)(4), as 
amended by this Act, is further amended by inserting before 
‘‘If, but’’ the following: ‘‘Such term shall not include a plan 
solely because such plan does not provide nonelective or
2112 
† HR 2617 EAS2 
matching contributions to employees described in section 
401(k)(15)(B)(i).’’. 
(f) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section shall 
apply to plan years beginning after December 31, 
2024. 
(2) SUBSECTION (d) AND (e).—The amendments 
made by subsections (d) and (e) shall take effect as if 
included in the enactment of section 112 of the Set-
ting Every Community Up for Retirement Enhance-
ment Act of 2019. 
SEC. 126. SPECIAL RULES FOR CERTAIN DISTRIBUTIONS 
FROM LONG-TERM QUALIFIED TUITION PRO-
GRAMS TO ROTH IRAS. 
(a) IN GENERAL.—Paragraph (3) of section 529(c) is 
amended by adding at the end the following new subpara-
graph: 
‘‘(E) SPECIAL
ROLLOVER
TO
ROTH
IRAS 
FROM
LONG-TERM
QUALIFIED
TUITION
PRO-
GRAMS.— 
‘‘(i) IN GENERAL.—In the case of a 
distribution from a qualified tuition pro-
gram of a designated beneficiary which has 
been maintained for the 15-year period end-
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† HR 2617 EAS2 
ing on the date of such distribution, sub-
paragraph (A) shall not apply to so much 
the portion of such distribution which— 
‘‘(I) does not exceed the aggregate 
amount contributed to the program 
(and earnings attributable thereto) be-
fore the 5-year period ending on the 
date of the distribution, and 
‘‘(II) is paid in a direct trustee- 
to-trustee transfer to a Roth IRA 
maintained for the benefit of such des-
ignated beneficiary. 
‘‘(ii) LIMITATIONS.— 
‘‘(I) 
ANNUAL
LIMITATION.— 
Clause (i) shall only apply to so much 
of any distribution as does not exceed 
the amount applicable to the des-
ignated 
beneficiary 
under 
section 
408A(c)(2) for the taxable year (re-
duced by the amount of aggregate con-
tributions made during the taxable 
year to all individual retirement plans 
maintained for the benefit of the des-
ignated beneficiary).
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† HR 2617 EAS2 
‘‘(II) AGGREGATE
LIMITATION.— 
This subparagraph shall not apply to 
any distribution described in clause (i) 
to the extent that the aggregate amount 
of such distributions with respect to the 
designated beneficiary for such taxable 
year and all prior taxable years ex-
ceeds $35,000.’’. 
(b) TREATMENT UNDER ROTH IRA RULES.— 
(1) IN
GENERAL.—Paragraph (1) of section 
408A(e) is amended— 
(A) by striking the period at the end of sub-
paragraph (B) and inserting ‘‘, and’’, 
(B) by inserting after subparagraph (B) the 
following new subparagraph: 
‘‘(C) from a qualified tuition program to 
the extent provided in section 529(c)(3)(E).’’, 
and 
(C) by adding at the end the following new 
sentence: ‘‘The earnings and contributions of any 
qualified tuition program from which a qualified 
rollover contribution is made under subpara-
graph (C) shall be treated in the same manner 
as the earnings and contributions of a Roth IRA
2115 
† HR 2617 EAS2 
from which a qualified rollover contribution is 
made under subparagraph (A).’’. 
(2) APPLICATION
OF
CONTRIBUTION
LIMITA-
TIONS.— 
(A) IN GENERAL.—Section 408A(c)(5)(B) is 
amended— 
(i) by striking ‘‘A qualified rollover 
contribution’’ and inserting the following: 
‘‘(i) IN GENERAL.—A qualified rollover 
contribution’’, and 
(ii) by adding at the end the following: 
‘‘(ii) 
EXCEPTION
FOR
ROLLOVERS 
FROM
QUALIFIED
TUITION
PROGRAMS.— 
Clause (i) shall not apply to any qualified 
rollover contribution described in subsection 
(e)(1)(C).’’. 
(B) WAIVER OF ROTH IRA INCOME LIMITA-
TION.—Section 408A(c)(3) is amended by adding 
at the end the following new subparagraph: 
‘‘(E) SPECIAL RULE FOR CERTAIN TRANS-
FERS
FROM
QUALIFIED
TUITION
PROGRAMS.— 
The amount determined under subparagraph (A) 
shall be increased by the lesser of—
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† HR 2617 EAS2 
‘‘(i) the amount of contributions de-
scribed in section 529(c)(3)(E) for the tax-
able year, or 
‘‘(ii) the amount of the reduction deter-
mined under such subparagraph (deter-
mined without regard to this subpara-
graph).’’. 
(c) REPORTING.—Section 529(d) is amended— 
(1) by striking ‘‘Each officer’’ and inserting the 
following: 
‘‘(1) IN GENERAL.—Each officer’’, 
(2) by striking ‘‘by this subsection’’ and insert-
ing ‘‘by this paragraph’’, and 
(3) by adding at the end the following new para-
graph: 
‘‘(2) ROLLOVER DISTRIBUTIONS.—In the case of 
any distribution described in subsection (c)(3)(E), the 
officer or employee having control of the qualified tui-
tion program (or their designee) shall provide a re-
port to the trustee of the Roth IRA to which the dis-
tribution is made. Such report shall be filed at such 
time and in such manner as the Secretary may re-
quire and shall include information with respect to 
the contributions, distributions, and earnings of the 
qualified tuition program as of the date of the dis-
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† HR 2617 EAS2 
tribution described in subsection (c)(3)(A), together 
with such other matters as the Secretary may re-
quire.’’. 
(d) EFFECTIVE DATE.—The amendments made by this 
section shall apply with respect to distributions after De-
cember 31, 2023. 
SEC. 127. EMERGENCY SAVINGS ACCOUNTS LINKED TO IN-
DIVIDUAL ACCOUNT PLANS. 
(a) EMPLOYEE PENSION BENEFIT PLANS.—Section 3 
of the Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1002) is amended by adding at the end the fol-
lowing: 
‘‘(45) PENSION-LINKED EMERGENCY SAVINGS AC-
COUNT.—The term ‘pension-linked emergency savings 
account’ means a short-term savings account estab-
lished and maintained as part of an individual ac-
count plan, in accordance with section 801, on behalf 
of an eligible participant (as such term is defined in 
section 801(b)) that— 
‘‘(A) is a designated Roth account (within 
the meaning of section 402A of the Internal Rev-
enue Code of 1986) and accepts only participant 
contributions, 
as 
described 
in 
section 
801(d)(1)(A), which are designated Roth con-
2118 
† HR 2617 EAS2 
tributions subject to the rules of section 402A(e) 
of such Code; and 
‘‘(B) meets the requirements of part 8 of 
subtitle B.’’. 
(b) PENSION-LINKED
EMERGENCY
SAVINGS
AC-
COUNTS.— 
(1) IN GENERAL.—Subtitle B of title I of the 
Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1021 et seq.) is amended by adding at the 
end the following: 
‘‘PART 8—PENSION-LINKED EMERGENCY SAVINGS 
ACCOUNTS 
‘‘SEC. 801. PENSION-LINKED EMERGENCY SAVINGS AC-
COUNTS. 
‘‘(a) IN GENERAL.—A plan sponsor of an individual 
account plan may— 
‘‘(1) include in such individual account plan a 
pension-linked emergency savings account meeting the 
requirements of subsection (c); and 
‘‘(2)(A) offer to enroll an eligible participant in 
such pension-linked emergency savings account; or 
‘‘(B) automatically enroll an eligible participant 
in such account pursuant to an automatic contribu-
tion arrangement described in paragraph (2) of sub-
section (c).
2119 
† HR 2617 EAS2 
‘‘(b) ELIGIBLE PARTICIPANT.— 
‘‘(1) IN GENERAL.—For purposes of this part, 
the term ‘eligible participant’, with regard to an indi-
vidual account plan, means an individual who— 
‘‘(A) meets any age, service, and other eligi-
bility requirements of the plan; and 
‘‘(B) is not a highly compensated employee. 
‘‘(2) ELIGIBLE PARTICIPANT WHO BECOMES A 
HIGHLY COMPENSATED EMPLOYEE.—Notwithstanding 
paragraph (1)(B), an individual who is enrolled in a 
pension-linked emergency savings account and there-
after becomes a highly compensated employee may not 
make further contributions to such account, but re-
tains the right to withdraw any account balance of 
such 
account 
in 
accordance 
with 
subsection 
(c)(1)(A)(ii). 
‘‘(3) DEFINITION.—For purposes of this sub-
section, the term ‘highly compensated employee’ has 
the meaning given the term in section 414(q) of the 
Internal Revenue Code of 1986. 
‘‘(c) ACCOUNT REQUIREMENTS.— 
‘‘(1) IN GENERAL.—A pension-linked emergency 
savings account— 
‘‘(A) shall—
2120 
† HR 2617 EAS2 
‘‘(i) not have a minimum contribution 
or account balance requirement; 
‘‘(ii) allow for withdrawal by the par-
ticipant of the account balance, in whole or 
in part at the discretion of the participant, 
at least once per calendar month and for 
distribution of such withdrawal to the par-
ticipant as soon as practicable from the 
date on which the participant elects to make 
such withdrawal; and 
‘‘(iii) be, as selected by the plan spon-
sor, held as cash, in an interest-bearing de-
posit account, or in an investment prod-
uct— 
‘‘(I) designed to— 
‘‘(aa) maintain over the term 
of the investment, the dollar value 
that is equal to the amount in-
vested in the product; and 
‘‘(bb) preserve principal and 
provide a reasonable rate of re-
turn, whether or not such return 
is guaranteed, consistent with the 
need for liquidity; and
2121 
† HR 2617 EAS2 
‘‘(II) offered by a State- or feder-
ally-regulated financial institution; 
‘‘(B) may be subject to, as permitted by the 
Secretary, reasonable restrictions; and 
‘‘(C)(i) may not, for not less than the first 
4 withdrawals of funds from the account in a 
plan year, be subject to any fees or charges solely 
on the basis of such a withdrawal; and 
‘‘(ii) may, for any subsequent withdrawal 
in a plan year, be subject to reasonable fees or 
charges in connection with such a withdrawal, 
including reasonable reimbursement fees imposed 
for the incidental costs of handling of paper 
checks. 
‘‘(2) ESTABLISHMENT AND TERMINATION OF AC-
COUNT.— 
‘‘(A) ESTABLISHMENT
OF
ACCOUNT.—The 
pension-linked emergency savings account fea-
ture shall be included in the plan document of 
the individual account plan. Such individual ac-
count plan shall— 
‘‘(i) separately account for contribu-
tions to the pension-linked emergency sav-
ings account of the individual account plan
2122 
† HR 2617 EAS2 
and any earnings properly allocable to the 
contributions; 
‘‘(ii) maintain separate recordkeeping 
with respect to each such pension-linked 
emergency savings account; and 
‘‘(iii) allow withdrawals from such ac-
count in accordance with section 402A(e)(7) 
of the Internal Revenue Code of 1986. 
‘‘(B) TERMINATION OF ACCOUNT.—A plan 
sponsor may terminate the pension-linked emer-
gency savings account feature of an individual 
account plan at any time. 
‘‘(d) ACCOUNT CONTRIBUTIONS.— 
‘‘(1) LIMITATION.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), no contribution shall be accepted to 
a pension-linked emergency savings account to 
the extent such contribution would cause the por-
tion of the account balance attributable to par-
ticipant contributions to exceed the lesser of— 
‘‘(i) $2,500; or 
‘‘(ii) an amount determined by the 
plan sponsor of the pension-linked emer-
gency savings account.
2123 
† HR 2617 EAS2 
In the case of contributions made in taxable 
years beginning after December 31, 2024, the 
Secretary shall adjust the amount under clause 
(i) at the same time and in the same manner as 
the adjustment made by the Secretary of the 
Treasury under section 415(d) of the Internal 
Revenue Code of 1986, except that the base pe-
riod shall be the calendar quarter beginning July 
1, 2023. Any increase under the preceding sen-
tence which is not a multiple of $100 shall be 
rounded to the next lowest multiple of $100. 
‘‘(B) EXCESS CONTRIBUTIONS.—To the ex-
tent any contribution to the pension-linked emer-
gency savings account of a participant for a tax-
able year would exceed the limitation of subpara-
graph (A)— 
‘‘(i) in the case of a participant with 
another designated Roth account under the 
individual account plan, such plan may 
provide that— 
‘‘(I) the participant may elect to 
increase the participant’s contribution 
to such other account; and 
‘‘(II) in the absence of such a par-
ticipant election, the participant is
2124 
† HR 2617 EAS2 
deemed to have elected to increase the 
participant’s contributions to such 
other account at the rate at which con-
tributions were being made to the pen-
sion-linked emergency savings account; 
and 
‘‘(ii) in any other case, such plan shall 
provide that such excess contributions will 
not be accepted. 
‘‘(2) 
AUTOMATIC
CONTRIBUTION
ARRANGE-
MENT.—For purposes of this section— 
‘‘(A) IN GENERAL.—An automatic contribu-
tion arrangement described in this paragraph is 
an arrangement under which an eligible partici-
pant is treated as having elected to have the plan 
sponsor make elective contributions to a pension- 
linked emergency savings account at a partici-
pant contribution rate that is not more than 3 
percent of the compensation of the eligible partic-
ipant, unless the eligible participant, at any 
time (subject to such reasonable advance notice 
as is required by the plan administrator), af-
firmatively elects to— 
‘‘(i) make contributions at a different 
rate or amount; or
2125 
† HR 2617 EAS2 
‘‘(ii) opt out of such contributions. 
‘‘(B) PARTICIPANT CONTRIBUTION RATE.— 
For purposes of an automatic contribution ar-
rangement described in subparagraph (A), the 
plan sponsor— 
‘‘(i) shall select a participant contribu-
tion rate under such automatic contribution 
arrangement that meets the requirements of 
subparagraph (A); and 
‘‘(ii) may amend (prior to the plan 
year in which an amendment would take ef-
fect) such rate not more than once annually. 
‘‘(3) DISCLOSURE BY PLAN ADMINISTRATOR OF 
CONTRIBUTIONS.— 
‘‘(A) IN GENERAL.—With respect to an in-
dividual account plan with a pension-linked 
emergency savings account feature, the adminis-
trator of the plan shall, not less than 30 days 
and not more than 90 days prior to date of the 
first contribution to the pension-linked emer-
gency savings account, including any contribu-
tion under an automatic contribution arrange-
ment described in subsection (d)(2), or the date 
of any adjustment to the participant contribu-
tion rate under subsection (d)(2)(B)(ii), and not
2126 
† HR 2617 EAS2 
less than annually thereafter, shall furnish to the 
participant a notice describing— 
‘‘(i) the purpose of the account, which 
is for short-term, emergency savings; 
‘‘(ii) the limits on, and tax treatment 
of, contributions to the pension-linked emer-
gency savings account of the participant; 
‘‘(iii) any fees, expenses, restrictions, 
or charges associated with such pension- 
linked emergency savings account; 
‘‘(iv) procedures for electing to make 
contributions to or opting out of the pen-
sion-linked emergency savings account, for 
changing participant contribution rates for 
such pension-linked emergency savings ac-
count, and for making participant with-
drawals from such pension-linked emer-
gency savings account, including any limits 
on frequency; 
‘‘(v) as applicable, the amount of the 
intended contribution to such pension- 
linked emergency savings account or the 
change in the percentage of the compensa-
tion of the participant of such contribution;
2127 
† HR 2617 EAS2 
‘‘(vi) the amount in the emergency sav-
ings account and the amount or percentage 
of compensation that a participant has con-
tributed to the pension-linked emergency 
savings account; 
‘‘(vii) the designated investment option 
under subsection (c)(1)(A)(iii) for amounts 
contributed to the pension-linked emergency 
savings account; 
‘‘(viii) the options under subsection (e) 
for the account balance of the pension-linked 
emergency savings account after termi-
nation of the employment of the participant 
or termination by the plan sponsor of the 
pension-linked emergency savings account; 
and 
‘‘(ix) the ability of a participant who 
becomes a highly compensated employee (as 
such term is defined in paragraph (3) of 
subsection (b)) to, as described in para-
graph (2) of such subsection, withdraw any 
account balance from a pension-linked 
emergency savings account and the restric-
tion on the ability of such a participant to
2128 
† HR 2617 EAS2 
make further contributions to the pension- 
linked emergency savings account. 
‘‘(B) NOTICE
REQUIREMENTS.—A notice 
furnished to a participant under subparagraph 
(A) shall be— 
‘‘(i) sufficiently accurate and com-
prehensive to apprise the participant of the 
rights and obligations of the participant 
with regard to the pension-linked emergency 
savings account of the participant; and 
‘‘(ii) written in a manner calculated to 
be understood by the average participant. 
‘‘(C) CONSOLIDATED
NOTICES.—The re-
quired notices under subparagraph (A) may be 
included with any other notice under this Act, 
including 
under 
section 
404(c)(5)(B) 
or 
514(e)(3), or under section 401(k)(13)(E) or 
414(w)(4) of the Internal Revenue Code of 1986, 
if such other notice is provided to the partici-
pant at the time required for such notice. 
‘‘(4) EMPLOYER MATCHING CONTRIBUTIONS TO 
AN INDIVIDUAL ACCOUNT PLAN FOR EMPLOYEE CON-
TRIBUTIONS TO A PENSION-LINKED EMERGENCY SAV-
INGS ACCOUNT.—
2129 
† HR 2617 EAS2 
‘‘(A) IN GENERAL.—If an employer makes 
any matching contributions to an individual ac-
count plan of which a pension-linked emergency 
savings account is part, subject to the limitations 
of paragraph (1)(A), the employer shall make 
matching contributions on behalf of a partici-
pant on account of the contributions by the par-
ticipant to the pension-linked emergency savings 
account at the same rate as any other matching 
contribution on account of an elective contribu-
tion by such participant. The matching con-
tributions shall be made to the participant’s ac-
count under the individual account plan that is 
not the pension-linked emergency savings ac-
count. Such matching contributions on account 
of contributions under paragraph (1)(A) shall 
not exceed the maximum account balance under 
paragraph (1)(A) for such plan year. 
‘‘(B) COORDINATION RULE.—For purposes 
of any applicable limitation on matching con-
tributions, any matching contributions made 
under the plan shall be treated first as attrib-
utable to the elective deferrals of the participant 
other than contributions to a pension-linked 
emergency savings account.
2130 
† HR 2617 EAS2 
‘‘(C) MATCHING CONTRIBUTIONS.—For pur-
poses of subparagraph (A), the term ‘matching 
contribution’ has the meaning given such term 
in section 401(m)(4) of the Internal Revenue 
Code of 1986. 
‘‘(e) ACCOUNT BALANCE AFTER TERMINATION.—Upon 
termination of employment of the participant, or termi-
nation by the plan sponsor of the pension-linked emergency 
savings account, the pension-linked emergency savings ac-
count of such participant in an individual account plan 
shall— 
‘‘(1) allow, at the election of the participant, for 
transfer by the participant of the account balance of 
such account, in whole or in part, into another des-
ignated Roth account of the participant under the in-
dividual account plan; and 
‘‘(2) for any amounts in such account not trans-
ferred under paragraph (1), make such amounts 
available within a reasonable time to the participant. 
‘‘(f) ANTI-ABUSE RULES.— 
‘‘(1) IN GENERAL.—A plan of which a pension- 
linked emergency savings account is part— 
‘‘(A) may employ reasonable procedures to 
limit the frequency or amount of matching con-
tributions with respect to contributions to such
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account, solely to the extent necessary to prevent 
manipulation of the rules of the plan to cause 
matching contributions to exceed the intended 
amounts or frequency; and 
‘‘(B) shall not be required to suspend 
matching contributions following any partici-
pant withdrawal of contributions, including elec-
tive deferrals and employee contributions, wheth-
er or not matched and whether or not made pur-
suant to an automatic contribution arrangement 
described in section 402A(e)(4) of the Internal 
Revenue Code of 1986. 
‘‘(2) REGULATIONS OR OTHER GUIDANCE.—The 
Secretary of the Treasury, in consultation with the 
Secretary of Labor, shall issue regulations or other 
guidance not later than 12 months after the date of 
the enactment of the SECURE 2.0 Act of 2022 with 
respect to the anti-abuse rules described in paragraph 
(1). 
‘‘SEC. 802. PREEMPTION OF STATE ANTI-GARNISHMENT 
LAWS. 
‘‘Notwithstanding any other provision of law, this part 
shall supersede any law of a State which would directly 
or indirectly prohibit or restrict the use of an automatic 
contribution arrangement, described in section 801(d)(2),
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for a pension-linked emergency savings account. The Sec-
retary may promulgate regulations to establish minimum 
standards that such an arrangement would be required to 
satisfy in order for this subsection to apply with respect 
to such an account. 
‘‘SEC. 803. REPORTING AND DISCLOSURE REQUIREMENTS. 
‘‘The Secretary shall— 
‘‘(1) prescribe such regulations as may be nec-
essary to address reporting and disclosure require-
ments for pension-linked emergency savings accounts; 
and 
‘‘(2) seek to prevent unnecessary reporting and 
disclosure for such accounts under this Act, including 
for purposes of any reporting or disclosure related to 
pension plans required by this title or under the In-
ternal Revenue Code of 1986. 
‘‘SEC. 804. REPORT TO CONGRESS ON EMERGENCY SAVINGS 
ACCOUNTS. 
‘‘The Secretary of Labor and the Secretary of the 
Treasury shall— 
‘‘(1) conduct a study on the use of emergency 
savings from individual account plan accounts, in-
cluding emergency savings from a pension-linked 
emergency savings account regarding—
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‘‘(A) whether the amount of the dollar limi-
tation under section 801(d)(1)(A) is sufficient; 
‘‘(B) whether the limitation on the contribu-
tion rate under section 801(d)(2)(A) is appro-
priate; and 
‘‘(C) the extent to which plan sponsors offer 
such accounts and participants participate in 
such accounts and the resulting impact on par-
ticipant retirement savings, including the im-
pact on retirement savings leakage and the effect 
of such accounts on retirement plan participa-
tion by low- and moderate-income households; 
and 
‘‘(2) not later than 7 years after the date of en-
actment of the SECURE 2.0 Act of 2022, submit to 
Congress a report on the findings of the study under 
paragraph (1).’’. 
(2) CLERICAL AMENDMENT.—The table of con-
tents in section 1 of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1001 note) is amend-
ed by inserting after the item relating to section 734 
the following new items: 
‘‘PART 8. PENSION-LINKED EMERGENCY SAVINGS ACCOUNTS 
‘‘801. Pension-linked emergency savings accounts. 
‘‘802. Preemption of State anti-garnishment laws. 
‘‘803. Reporting and disclosure requirements. 
‘‘804. Report to Congress on emergency savings accounts.’’.
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(c) REPORTING FOR A PENSION-LINKED EMERGENCY 
SAVINGS ACCOUNT.— 
(1) ALTERNATIVE METHODS OF COMPLIANCE.— 
Section 110(a) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1030(a)) is amended 
by inserting ‘‘(including pension-linked emergency 
savings account features within a pension plan)’’ 
after ‘‘class of pension plans’’. 
(2) MINIMIZED REPORTING BURDEN FOR PEN-
SION-LINKED EMERGENCY SAVINGS ACCOUNTS.—Sec-
tion 101 of such Act (29 U.S.C. 1021) is amended— 
(A) by redesignating subsection (n) as sub-
section (o); and 
(B) by inserting after subsection (m) the fol-
lowing: 
‘‘(n) PENSION-LINKED
EMERGENCY
SAVINGS
AC-
COUNTS.—Nothing in this section shall preclude the Sec-
retary from providing, by regulations or otherwise, sim-
plified reporting procedures or requirements regarding such 
a pension-linked emergency savings account.’’. 
(d) FIDUCIARY DUTY.—Section 404(c) of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C. 
1104(c)) is amended by adding at the end the following: 
‘‘(6) DEFAULT INVESTMENT ARRANGEMENTS FOR 
A PENSION-LINKED EMERGENCY SAVINGS ACCOUNT.—
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† HR 2617 EAS2 
For purposes of paragraph (1), a participant in a 
pension-linked emergency savings account shall be 
treated as exercising control over the assets in the ac-
count with respect to the amount of contributions and 
earnings which are invested in accordance with sec-
tion 801(c)(1)(A)(iii).’’. 
(e) TAX TREATMENT OF PENSION-LINKED EMERGENCY 
SAVINGS ACCOUNTS.— 
(1) IN GENERAL.—Section 402A is amended by 
redesignating subsection (e) as subsection (f) and by 
inserting after subsection (d) the following new sub-
section: 
‘‘(e) PENSION-LINKED
EMERGENCY
SAVINGS
AC-
COUNTS.— 
‘‘(1) IN
GENERAL.—An applicable retirement 
plan— 
‘‘(A) may— 
‘‘(i) include a pension-linked emer-
gency savings account established pursuant 
to section 801 of the Employee Retirement 
Income Security Act of 1974, which, except 
as otherwise provided in this subsection, 
shall be treated for purposes of this title as 
a designated Roth account, and 
‘‘(ii) either—
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† HR 2617 EAS2 
‘‘(I) offer to enroll an eligible par-
ticipant in such pension-linked emer-
gency savings account, or 
‘‘(II) automatically enroll an eli-
gible participant in such account pur-
suant to an automatic contribution ar-
rangement described in paragraph (4), 
and 
‘‘(B) shall— 
‘‘(i) separately account for contribu-
tions to such account and any earnings 
properly allocable to the contributions, 
‘‘(ii) maintain separate recordkeeping 
with respect to each such account, and 
‘‘(iii) allow withdrawals from such ac-
count in accordance with paragraph (7). 
‘‘(2) ELIGIBLE PARTICIPANT.— 
‘‘(A) IN
GENERAL.—For purposes of this 
subsection, the term ‘eligible participant’, with 
regard to a defined contribution plan, means an 
individual, without regard to whether the indi-
vidual is otherwise a participant in such plan, 
who— 
‘‘(i) meets any age, service, and other 
eligibility requirements of the plan, and
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† HR 2617 EAS2 
‘‘(ii) is not a highly compensated em-
ployee (as defined in section 414(q)). 
‘‘(B) ELIGIBLE PARTICIPANT WHO BECOMES 
A HIGHLY COMPENSATED EMPLOYEE.—Notwith-
standing subparagraph (A)(ii), an individual on 
whose behalf a pension-linked emergency savings 
account is established who thereafter becomes a 
highly compensated employee (as so defined) 
may not make further contributions to such ac-
count, but retains the right to withdraw any ac-
count balance of such account in accordance with 
paragraphs (7) and (8). 
‘‘(3) CONTRIBUTION LIMITATION.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), no contribution shall be accepted to 
a pension-linked emergency savings account to 
the extent such contribution would cause the por-
tion of the account balance attributable to par-
ticipant contributions to exceed the lesser of— 
‘‘(i) $2,500; or 
‘‘(ii) an amount determined by the 
plan sponsor of the pension-linked emer-
gency savings account. 
In the case of contributions made in taxable 
years beginning after December 31, 2024, the
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† HR 2617 EAS2 
Secretary shall adjust the amount under clause 
(i) at the same time and in the same manner as 
the adjustment made under section 415(d), ex-
cept that the base period shall be the calendar 
quarter beginning July 1, 2023. Any increase 
under the preceding sentence which is not a mul-
tiple of $100 shall be rounded to the next lowest 
multiple of $100. 
‘‘(B) EXCESS CONTRIBUTIONS.—To the ex-
tent any contribution to the pension-linked emer-
gency savings account of a participant for a tax-
able year would exceed the limitation of subpara-
graph (A)— 
‘‘(i) in the case of an eligible partici-
pant with another designated Roth account 
under the defined contribution plan, the 
plan may provide that— 
‘‘(I) the participant may elect to 
increase the participant’s contribution 
to such other account, and 
‘‘(II) in the absence of such a par-
ticipant election, the participant is 
deemed to have elected to increase the 
participant’s contributions to such ac-
count at the rate at which contribu-
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† HR 2617 EAS2 
tions were being made to the pension- 
linked emergency savings account, and 
‘‘(ii) in any other case, such plan shall 
provide that such excess contributions will 
not be accepted. 
‘‘(4) 
AUTOMATIC
CONTRIBUTION
ARRANGE-
MENT.—For purposes of this section— 
‘‘(A) IN GENERAL.—An automatic contribu-
tion arrangement described in this paragraph is 
an arrangement under which an eligible partici-
pant is treated as having elected to have the plan 
sponsor make elective contributions to a pension- 
linked emergency savings account at a partici-
pant contribution rate that is not more than 3 
percent of the compensation of the eligible partic-
ipant, unless the eligible participant, at any 
time (subject to such reasonable advance notice 
as is required by the plan administrator), af-
firmatively elects to— 
‘‘(i) make contributions at a different 
rate, or 
‘‘(ii) opt out of such contributions. 
‘‘(B) PARTICIPANT CONTRIBUTION RATE.— 
For purposes of an automatic contribution ar-
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† HR 2617 EAS2 
annually thereafter, shall furnish to the partici-
pant a notice describing— 
‘‘(i) the purpose of the account, which 
is for short-term, emergency savings; 
‘‘(ii) the limits on, and tax treatment 
of, contributions to the pension-linked emer-
gency savings account of the participant; 
‘‘(iii) any fees, expenses, restrictions, 
or charges associated with such pension- 
linked emergency savings account; 
‘‘(iv) procedures for electing to make 
contributions or opting out of the pension- 
linked emergency savings account, changing 
participant contribution rates for such ac-
count, and making participant withdrawals 
from such pension-linked emergency savings 
account, including any limits on frequency; 
‘‘(v) the amount of the intended con-
tribution or the change in the percentage of 
the compensation of the participant of such 
contribution, if applicable; 
‘‘(vi) the amount in the pension-linked 
emergency savings account and the amount 
or percentage of compensation that a par-
ticipant has contributed to such account;
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† HR 2617 EAS2 
‘‘(vii) the designated investment option 
under section 801(c)(1)(A)(iii) of the Em-
ployee Retirement Income Security Act of 
1974 for amounts contributed to the pen-
sion-linked emergency savings account; 
‘‘(viii) the options under section 801(e) 
of such Act for the account balance of the 
pension-linked emergency savings account 
after termination of the employment of the 
participant; and 
‘‘(ix) the ability of a participant who 
becomes a highly compensated employee (as 
such term is defined in section 414(q)) to, 
as described in section 801(b)(2) of the Em-
ployee Retirement Income Security Act of 
1974, withdraw any account balance from a 
pension-linked emergency savings account 
and the restriction on the ability of such a 
participant to make further contributions to 
the pension-linked emergency savings ac-
count. 
‘‘(B) NOTICE
REQUIREMENTS.—A notice 
furnished to a participant under subparagraph 
(A) shall be—
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† HR 2617 EAS2 
‘‘(i) sufficiently accurate and com-
prehensive to apprise the participant of the 
rights and obligations of the participant 
with regard to the pension-linked emergency 
savings account of the participant; and 
‘‘(ii) written in a manner calculated to 
be understood by the average participant. 
‘‘(C) CONSOLIDATED
NOTICES.—The re-
quired notices under subparagraph (A) may be 
included with any other notice under the Em-
ployee Retirement Income Security Act of 1974, 
including 
under 
section 
404(c)(5)(B) 
or 
514(e)(3) 
of 
such 
Act, 
or 
under 
section 
401(k)(13)(E) or 414(w)(4), if such other notice 
is provided to the participant at the time re-
quired for such notice. 
‘‘(6) EMPLOYER MATCHING CONTRIBUTIONS TO A 
DEFINED CONTRIBUTION PLAN FOR EMPLOYEE CON-
TRIBUTIONS TO A PENSION-LINKED EMERGENCY SAV-
INGS ACCOUNT.— 
‘‘(A) IN GENERAL.—If an employer makes 
any matching contributions to a defined con-
tribution plan of which a pension-linked emer-
gency savings account is part, subject to the lim-
itations of paragraph (3), the employer shall
2144 
† HR 2617 EAS2 
make matching contributions on behalf of an eli-
gible participant on account of the participant’s 
contributions to the pension-linked emergency 
savings account at the same rate as any other 
matching contribution on account of an elective 
contribution by such participant. The matching 
contributions shall be made to the participant’s 
account under the defined contribution plan 
which is not the pension-linked emergency sav-
ings account. Such matching contributions on 
account of contributions to the pension-linked 
emergency savings account shall not exceed the 
maximum account balance under paragraph 
(3)(A) for such plan year. 
‘‘(B) COORDINATION RULE.—For purposes 
of any applicable limitation on matching con-
tributions, any matching contributions made 
under the plan shall be treated first as attrib-
utable to the elective deferrals of the participant 
other than contributions to a pension-linked 
emergency savings account. 
‘‘(C) MATCHING CONTRIBUTIONS.—For pur-
poses of subparagraph (A), the term ‘matching 
contribution’ has the meaning given such term 
in section 401(m)(4).
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† HR 2617 EAS2 
‘‘(7) DISTRIBUTIONS.— 
‘‘(A) IN GENERAL.—A pension-linked emer-
gency savings account shall allow for withdrawal 
by the participant on whose behalf the account 
is established of the account balance, in whole or 
in part at the discretion of the participant, at 
least once per calendar month and for distribu-
tion of such withdrawal to the participant as 
soon as practicable after the date on which the 
participant elects to make such withdrawal. 
‘‘(B) TREATMENT OF DISTRIBUTIONS.—Any 
distribution from a pension-linked emergency 
savings account in accordance with subpara-
graph (A)— 
‘‘(i) shall be treated as a qualified dis-
tribution for purposes of subsection (d), and 
‘‘(ii) shall be treated as meeting the re-
quirements 
of 
sections 
401(k)(2)(B)(i), 
403(b)(7)(A)(i), 
403(b)(11), 
and 
457(d)(1)(A). 
‘‘(8) ACCOUNT BALANCE AFTER TERMINATION.— 
‘‘(A) IN
GENERAL.—Upon termination of 
employment of the participant, or termination 
by the plan sponsor of the pension-linked emer-
gency savings account, the pension-linked emer-
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† HR 2617 EAS2 
gency savings account of such participant in a 
defined contribution plan shall— 
‘‘(i) allow, at the election of the partic-
ipant, for transfer by the participant of the 
account balance of such account, in whole or 
in part, into another designated Roth ac-
count of the participant under the defined 
contribution plan; and 
‘‘(ii) for any amounts in such account 
not transferred under paragraph (1), make 
such amounts available within a reasonable 
time to the participant. 
‘‘(B) PROHIBITION
OF
CERTAIN
TRANS-
FERS.—No amounts shall be transferred by the 
participant from another account of the partici-
pant under any plan of the employer into the 
pension-linked emergency savings account of the 
participant. 
‘‘(C) COORDINATION
WITH
SECTION
72.— 
Subparagraph (F) of section 408A(d)(3) shall 
not apply (including by reason of subsection 
(c)(4)(D) of this section) to any rollover con-
tribution of amounts in a pension-linked emer-
gency savings account under subparagraph (A).
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† HR 2617 EAS2 
‘‘(9) COORDINATION WITH DISTRIBUTION OF EX-
CESS DEFERRALS.—If any excess deferrals are dis-
tributed under section 402(g)(2)(A) to a participant, 
such amounts shall be distributed first from any pen-
sion-linked emergency savings account of the partici-
pant to the extent contributions were made to such 
account for the taxable year. 
‘‘(10) TREATMENT OF ACCOUNT BALANCES.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), a distribution from a pen-
sion-linked emergency savings account shall not 
be treated as an eligible rollover distribution for 
purposes of sections 401(a)(31), 402(f), and 
3405. 
‘‘(B) TERMINATION.—In the case of termi-
nation of employment of the participant, or ter-
mination by the plan sponsor of the pension- 
linked emergency savings account, except for 
purposes of 401(a)(31)(B), a distribution from a 
pension-linked emergency savings account which 
is 
contributed 
as 
provided 
in 
paragraph 
(8)(A)(i) shall be treated as an eligible rollover 
distribution. 
‘‘(11) 
EXCEPTION
TO
PLAN
AMENDMENT 
RULES.—Notwithstanding section 411(d)(6), a plan
2148 
† HR 2617 EAS2 
which includes a pension-linked emergency savings 
account may cease to offer such accounts at any time. 
‘‘(12) ANTI-ABUSE RULES.—A plan of which a 
pension-linked emergency savings account is part— 
‘‘(A) may employ reasonable procedures to 
limit the frequency or amount of matching con-
tributions with respect to contributions to such 
account, solely to the extent necessary to prevent 
manipulation of the rules of the plan to cause 
matching contributions to exceed the intended 
amounts or frequency, and 
‘‘(B) shall not be required to suspend 
matching contributions following any partici-
pant withdrawal of contributions, including elec-
tive deferrals and employee contributions, wheth-
er or not matched and whether or not made pur-
suant to an automatic contribution arrangement 
described in paragraph (4). 
The Secretary, in consultation with the Secretary of 
Labor, shall issue regulations or other guidance not 
later than 12 months after the date of the enactment 
of the SECURE 2.0 Act of 2022 with respect to the 
anti-abuse rules described in the preceding sentence.’’. 
(2) TREATMENT FOR PURPOSES OF ADDITIONAL 
TAX ON EARLY DISTRIBUTIONS.—Section 72(t)(2), as
2149 
† HR 2617 EAS2 
amended by the preceding provisions of this Act, is 
further amended by adding at the end the following 
new subparagraph: 
‘‘(J) DISTRIBUTIONS FROM PENSION-LINKED 
EMERGENCY
SAVINGS
ACCOUNT.—Distributions 
from a pension-linked emergency savings account 
pursuant to section 402A(e).’’. 
(3) BASIS RECOVERY.—Section 72(d) is amended 
by adding at the end the following new paragraph: 
‘‘(3) TREATMENT OF CONTRIBUTIONS TO A PEN-
SION-LINKED
EMERGENCY
SAVINGS
ACCOUNT.—For 
purposes of this section, contributions to a pension- 
linked emergency savings account to which section 
402A(e) applies (and any income allocable thereto) 
may be treated as a separate contract.’’. 
(f) REGULATORY
AUTHORITY.—The Secretary of 
Labor and the Secretary of the Treasury (or a delegate of 
either such Secretary) shall have authority to issue regula-
tions or other guidance, and to coordinate in developing 
regulations or other guidance, to carry out the purposes of 
this Act, including— 
(1) adjustment of the limitation under section 
801(d)(1) of the Employee Retirement Income Secu-
rity Act of 1974 and section 402A(e)(3) of the Inter-
2150 
† HR 2617 EAS2 
nal Revenue Code of 1986, as added by this Act, to 
account for inflation; 
(2) expansion of corrections programs, if nec-
essary; 
(3) model plan language and notices relating to 
pension-linked emergency savings accounts; and 
(4) with regard to interactions with section 
401(k)(13) of the Internal Revenue Code of 1986. 
(g) EFFECTIVE DATE.—The amendments made by this 
section shall apply to plan years beginning after December 
31, 2023. 
SEC. 128. ENHANCEMENT OF 403(b) PLANS. 
(a) IN
GENERAL.—Subparagraph (A) of section 
403(b)(7) is amended by striking ‘‘if the amounts are to 
be invested in regulated investment company stock to be 
held in that custodial account’’ and inserting ‘‘if the 
amounts are to be held in that custodial account and are 
invested in regulated investment company stock or a group 
trust intended to satisfy the requirements of Internal Rev-
enue Service Revenue Ruling 81–100 (or any successor 
guidance)’’. 
(b) CONFORMING AMENDMENT.—The heading of para-
graph (7) of section 403(b) is amended by striking ‘‘FOR 
REGULATED INVESTMENT COMPANY STOCK’’.
2151 
† HR 2617 EAS2 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to amounts invested after the date of 
the enactment of this Act. 
TITLE II—PRESERVATION OF 
INCOME 
SEC. 201. REMOVE REQUIRED MINIMUM DISTRIBUTION 
BARRIERS FOR LIFE ANNUITIES. 
(a) IN GENERAL.—Section 401(a)(9) is amended by 
adding at the end the following new subparagraph: 
‘‘(J) CERTAIN
INCREASES
IN
PAYMENTS 
UNDER
A
COMMERCIAL
ANNUITY.—Nothing in 
this section shall prohibit a commercial annuity 
(within the meaning of section 3405(e)(6)) that 
is issued in connection with any eligible retire-
ment plan (within the meaning of section 
402(c)(8)(B), other than a defined benefit plan) 
from providing one or more of the following 
types of payments on or after the annuity start-
ing date: 
‘‘(i) annuity payments that increase 
by a constant percentage, applied not less 
frequently than annually, at a rate that is 
less than 5 percent per year, 
‘‘(ii) a lump sum payment that—
2152 
† HR 2617 EAS2 
‘‘(I) results in a shortening of the 
payment period with respect to an an-
nuity or a full or partial commutation 
of the future annuity payments, pro-
vided that such lump sum is deter-
mined 
using 
reasonable 
actuarial 
methods and assumptions, as deter-
mined in good faith by the issuer of the 
contract, or 
‘‘(II) accelerates the receipt of an-
nuity payments that are scheduled to 
be received within the ensuing 12 
months, regardless of whether such ac-
celeration shortens the payment period 
with respect to the annuity, reduces the 
dollar amount of benefits to be paid 
under the contract, or results in a sus-
pension of annuity payments during 
the period being accelerated, 
‘‘(iii) an amount which is in the na-
ture of a dividend or similar distribution, 
provided that the issuer of the contract de-
termines such amount using reasonable ac-
tuarial methods and assumptions, as deter-
mined in good faith by the issuer of the con-
2153 
† HR 2617 EAS2 
tract, when calculating the initial annuity 
payments and the issuer’s experience with 
respect to those factors, or 
‘‘(iv) a final payment upon death that 
does not exceed the excess of the total 
amount of the consideration paid for the 
annuity 
payments, 
less 
the 
aggregate 
amount of prior distributions or payments 
from or under the contract.’’. 
(b) EFFECTIVE DATE.—This section shall apply to cal-
endar years ending after the date of the enactment of this 
Act. 
SEC. 202. QUALIFYING LONGEVITY ANNUITY CONTRACTS. 
(a) IN GENERAL.—Not later than the date which is 
18 months after the date of the enactment of this Act, the 
Secretary of the Treasury (or the Secretary’s delegate) shall 
amend the regulation issued by the Department of the 
Treasury relating to ‘‘Longevity Annuity Contracts’’ (79 
Fed. Reg. 37633 (July 2, 2014)), as follows: 
(1) REPEAL 25-PERCENT PREMIUM LIMIT.—The 
Secretary (or delegate) shall amend Q&A–17(b)(3) of 
Treas. Reg. section 1.401(a)(9)–6 and Q&A–12(b)(3) 
of Treas. Reg. section 1.408–8 to eliminate the re-
quirement that premiums for qualifying longevity an-
nuity contracts be limited to 25 percent of an indi-
2154 
† HR 2617 EAS2 
vidual’s account balance, and to make such cor-
responding changes to the regulations and related 
forms as are necessary to reflect the elimination of 
this requirement. 
(2) INCREASE DOLLAR LIMITATION.— 
(A) IN GENERAL.—The Secretary (or dele-
gate) shall amend Q&A–17(b)(2)(i) of Treas. 
Reg. section 1.401(a)(9)–6 and Q&A–12(b)(2)(i) 
of Treas. Reg. section 1.408–8 to increase the 
dollar limitation on premiums for qualifying 
longevity annuity contracts from $125,000 to 
$200,000, and to make such corresponding 
changes to the regulations and related forms as 
are necessary to reflect this increase in the dollar 
limitation. 
(B) ADJUSTMENTS
FOR
INFLATION.—The 
Secretary (or delegate) shall amend Q&A– 
17(d)(2)(i) of Treas. Reg. section 1.401(a)(9)–6 
to provide that, in the case of calendar years be-
ginning on or after January 1 of the second year 
following the year of enactment of this Act, the 
$200,000 dollar limitation (as increased by sub-
paragraph (A)) will be adjusted at the same time 
and in the same manner as the limits are ad-
justed under section 415(d) of the Internal Rev-
2155 
† HR 2617 EAS2 
enue Code of 1986, except that the base period 
shall be the calendar quarter beginning July 1 of 
the year of enactment of this Act, and any in-
crease to such dollar limitation which is not a 
multiple of $10,000 will be rounded to the next 
lowest multiple of $10,000. 
(3) FACILITATE
JOINT
AND
SURVIVOR
BENE-
FITS.—The Secretary (or delegate) shall amend Q&A– 
17(c) of Treas. Reg. section 1.401(a)(9)–6, and make 
such corresponding changes to the regulations and re-
lated forms as are necessary, to provide that, in the 
case of a qualifying longevity annuity contract which 
was purchased with joint and survivor annuity bene-
fits for the individual and the individual’s spouse 
which were permissible under the regulations at the 
time the contract was originally purchased, a divorce 
occurring after the original purchase and before the 
annuity payments commence under the contract will 
not affect the permissibility of the joint and survivor 
annuity benefits or other benefits under the contract, 
or require any adjustment to the amount or duration 
of benefits payable under the contract, provided that 
any qualified domestic relations order (within the 
meaning of section 414(p) of the Internal Revenue 
Code of 1986) or, in the case of an arrangement not
2156 
† HR 2617 EAS2 
subject to section 414(p) of such Code or section 
206(d) of the Employee Retirement Income Security 
Act of 1974, any divorce or separation instrument (as 
defined in subsection (b))— 
(A) provides that the former spouse is enti-
tled to the survivor benefits under the contract; 
(B) provides that the former spouse is treat-
ed as a surviving spouse for purposes of the con-
tract; 
(C) does not modify the treatment of the 
former spouse as the beneficiary under the con-
tract who is entitled to the survivor benefits; or 
(D) does not modify the treatment of the 
former spouse as the measuring life for the sur-
vivor benefits under the contract. 
(4) PERMIT SHORT FREE LOOK PERIOD.—The 
Secretary (or delegate) shall amend Q&A–17(a)(4) of 
Treas. Reg. section 1.401(a)(9)–6 to ensure that such 
Q&A does not preclude a contract from including a 
provision under which an employee may rescind the 
purchase of the contract within a period not exceeding 
90 days from the date of purchase. 
(b) DIVORCE OR SEPARATION INSTRUMENT.—For pur-
poses of subsection (a)(3), the term ‘‘divorce or separation 
instrument’’ means—
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† HR 2617 EAS2 
(1) a decree of divorce or separate maintenance 
or a written instrument incident to such a decree; 
(2) a written separation agreement; or 
(3) a decree (not described in paragraph (1)) re-
quiring a spouse to make payments for the support or 
maintenance of the other spouse. 
(c) EFFECTIVE DATES, ENFORCEMENT, AND INTER-
PRETATIONS.— 
(1) EFFECTIVE DATES.— 
(A) Paragraphs (1) and (2) of subsection 
(a) shall be effective with respect to contracts 
purchased or received in an exchange on or after 
the date of the enactment of this Act. 
(B) Paragraphs (3) and (4) of subsection 
(a) shall be effective with respect to contracts 
purchased or received in an exchange on or after 
July 2, 2014. 
(2) ENFORCEMENT
AND
INTERPRETATIONS.— 
Prior to the date on which the Secretary of the Treas-
ury issues final regulations pursuant to subsection 
(a)— 
(A) the Secretary (or delegate) shall admin-
ister and enforce the law in accordance with sub-
section (a) and the effective dates in paragraph 
(1) of this subsection; and
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† HR 2617 EAS2 
(B) taxpayers may rely upon their reason-
able good faith interpretations of subsection (a). 
(d) REGULATORY SUCCESSOR PROVISION.—Any ref-
erence to a regulation under this section shall be treated 
as including a reference to any successor regulation thereto. 
SEC. 
203. 
INSURANCE-DEDICATED 
EXCHANGE-TRADED 
FUNDS. 
(a) IN GENERAL.—Not later than the date which is 
7 years after the date of the enactment of this Act, the Sec-
retary of the Treasury (or the Secretary’s delegate) shall 
amend the regulation issued by the Department of the 
Treasury relating to ‘‘Income Tax; Diversification Require-
ments for Variable Annuity, Endowment, and Life Insur-
ance Contracts’’, 54 Fed. Reg. 8728 (March 2, 1989), and 
make any necessary corresponding amendments to other 
regulations, in order to facilitate the use of exchange-traded 
funds as investment options under variable contracts within 
the meaning of section 817(d) of the Internal Revenue Code 
of 1986, in accordance with subsections (b) and (c) of this 
section. 
(b) DESIGNATE CERTAIN AUTHORIZED PARTICIPANTS 
AND MARKET MAKERS AS ELIGIBLE INVESTORS.—The Sec-
retary of the Treasury (or the Secretary’s delegate) shall 
amend Treas. Reg. section 1.817–5(f)(3) to provide that sat-
isfaction of the requirements in Treas. Reg. section 1.817–
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† HR 2617 EAS2 
5(f)(2)(i) with respect to an exchange-traded fund shall not 
be prevented by reason of beneficial interests in such a fund 
being held by 1 or more authorized participants or market 
makers. 
(c) DEFINE RELEVANT TERMS.—In amending Treas. 
Reg. section 1.817–5(f)(3) in accordance with subsection 
(b), the Secretary of the Treasury (or the Secretary’s dele-
gate) shall provide definitions consistent with the following: 
(1) EXCHANGE-TRADED FUND.—The term ‘‘ex-
change-traded fund’’ means a regulated investment 
company, partnership, or trust— 
(A) that is registered with the Securities 
and Exchange Commission as an open-end in-
vestment company or a unit investment trust; 
(B) the shares of which can be purchased or 
redeemed directly from the fund only by an au-
thorized participant; and 
(C) the shares of which are traded through-
out the day on a national stock exchange at mar-
ket prices that may or may not be the same as 
the net asset value of the shares. 
(2) AUTHORIZED PARTICIPANT.—The term ‘‘au-
thorized participant’’ means a financial institution 
that is a member or participant of a clearing agency 
registered under section 17A(b) of the Securities Ex-
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† HR 2617 EAS2 
change Act of 1934 that enters into a contractual re-
lationship with an exchange-traded fund pursuant to 
which the financial institution is permitted to pur-
chase and redeem shares directly from the fund and 
to sell such shares to third parties, but only if the 
contractual arrangement or applicable law precludes 
the financial institution from— 
(A) purchasing the shares for its own in-
vestment purposes rather than for the exclusive 
purpose of creating and redeeming such shares 
on behalf of third parties; and 
(B) selling the shares to third parties who 
are not market makers or otherwise described in 
Treas. Reg. section 1.817–5(f) (1) and (3). 
(3) MARKET MAKER.—The term ‘‘market maker’’ 
means a financial institution that is a registered 
broker or dealer under section 15(b) of the Securities 
Exchange Act of 1934 that maintains liquidity for an 
exchange-traded fund on a national stock exchange by 
being always ready to buy and sell shares of such 
fund on the market, but only if the financial institu-
tion is contractually or legally precluded from selling 
or buying such shares to or from persons who are not 
authorized participants or otherwise described in 
Treas. Reg. section 1.817–5(f) (2) and (3).
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† HR 2617 EAS2 
(d) EFFECTIVE DATE.—This section shall apply to seg-
regated asset account investments made on or after the date 
which is 7 years after the date of the enactment of this Act. 
SEC. 
204. 
ELIMINATING 
A 
PENALTY 
ON 
PARTIAL 
ANNUITIZATION. 
(a) 
ELIMINATING
A
PENALTY
ON
PARTIAL 
ANNUITIZATION.—The Secretary of the Treasury (or the 
Secretary’s delegate) shall amend the regulations under sec-
tion 401(a)(9) of the Internal Revenue Code of 1986 to pro-
vide that if an employee’s benefit is in the form of an indi-
vidual account under a defined contribution plan, the plan 
may allow the employee to elect to have the amount required 
to be distributed from such account under such section for 
a year to be calculated as the excess of the total required 
amount for such year over the annuity amount for such 
year. 
(b) DEFINITIONS.—For purposes of this section— 
(1) TOTAL REQUIRED AMOUNT.—The term ‘‘total 
required amount’’, with respect to a year, means the 
amount which would be required to be distributed 
under Treas. Reg. section 1.401(a)(9)–5 (or any suc-
cessor regulation) for the year, determined by treating 
the account balance as of the last valuation date in 
the immediately preceding calendar year as including 
the value on that date of all annuity contracts which
2162 
† HR 2617 EAS2 
were purchased with a portion of the account and 
from which payments are made in accordance with 
Treas. Reg. section 1.401(a)(9)–6. 
(2) ANNUITY
AMOUNT.—The term ‘‘annuity 
amount’’, with respect to a year, is the total amount 
distributed in the year from all annuity contracts de-
scribed in paragraph (1). 
(c) CONFORMING REGULATORY AMENDMENTS.—The 
Secretary of the Treasury (or the Secretary’s delegate) shall 
amend the regulations under sections 403(b)(10), 408(a)(6), 
408(b)(3), and 457(d)(2) of the Internal Revenue Code of 
1986 to conform to the amendments described in subsection 
(a). Such conforming amendments shall treat all individual 
retirement plans (as defined in section 7701(a)(37) of such 
Code) which an individual holds as the owner, or which 
an individual holds as a beneficiary of the same decedent, 
as one such plan for purposes of the amendments described 
in subsection (a). Such conforming amendments shall also 
treat all contracts described in section 403(b) of such Code 
which an individual holds as an employee, or which an in-
dividual holds as a beneficiary of the same decedent, as one 
such contract for such purposes. 
(d) EFFECTIVE DATE.—The modifications and amend-
ments required under subsections (a) and (c) shall be
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† HR 2617 EAS2 
deemed to have been made as of the date of the enactment 
of this Act, and as of such date— 
(1) all applicable laws shall be applied in all re-
spects as though the actions which the Secretary of the 
Treasury (or the Secretary’s delegate) is required to 
take under such subsections had been taken, and 
(2) until such time as such actions are taken, 
taxpayers may rely upon their reasonable good faith 
interpretations of this section. 
TITLE III—SIMPLIFICATION AND 
CLARIFICATION OF RETIRE-
MENT PLAN RULES 
SEC. 301. RECOVERY OF RETIREMENT PLAN OVERPAY-
MENTS. 
(a) OVERPAYMENTS UNDER ERISA.—Section 206 of 
the Employee Retirement Income Security Act of 1974 (29 
U.S.C. 1056) is amended by adding at the end the following 
new subsection: 
‘‘(h) SPECIAL RULES APPLICABLE TO BENEFIT OVER-
PAYMENTS.— 
‘‘(1) GENERAL RULE.—In the case of an inad-
vertent benefit overpayment by any pension plan, the 
responsible plan fiduciary shall not be considered to 
have failed to comply with the requirements of this 
title merely because such fiduciary determines, in the
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† HR 2617 EAS2 
exercise of its discretion, not to seek recovery of all or 
part of such overpayment from— 
‘‘(A) any participant or beneficiary, 
‘‘(B) any plan sponsor of, or contributing 
employer to— 
‘‘(i) an individual account plan, pro-
vided that the amount needed to prevent or 
restore any impermissible forfeiture from 
any participant’s or beneficiary’s account 
arising in connection with the overpayment 
is, separately from and independently of the 
overpayment, allocated to such account pur-
suant to the nonforfeitability requirements 
of section 203 (for example, out of the plan’s 
forfeiture account, additional employer con-
tributions, or recoveries from those respon-
sible for the overpayment), or 
‘‘(ii) a defined benefit pension plan 
subject to the funding rules in part 3 of this 
subtitle B, unless the responsible plan fidu-
ciary determines, in the exercise of its fidu-
ciary discretion, that failure to recover all 
or part of the overpayment faster than re-
quired under such funding rules would ma-
terially affect the plan’s ability to pay bene-
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† HR 2617 EAS2 
fits due to other participants and bene-
ficiaries, or 
‘‘(C) any fiduciary of the plan, other than 
a fiduciary (including a plan sponsor or contrib-
uting employer acting in a fiduciary capacity) 
whose breach of its fiduciary duties resulted in 
such overpayment, provided that if the plan has 
established prudent procedures to prevent and 
minimize overpayment of benefits and the rel-
evant plan fiduciaries have followed such proce-
dures, an inadvertent benefit overpayment will 
not give rise to a breach of fiduciary duty. 
‘‘(2) REDUCTION IN FUTURE BENEFIT PAYMENTS 
AND RECOVERY FROM RESPONSIBLE PARTY.—Para-
graph (1) shall not fail to apply with respect to any 
inadvertent benefit overpayment merely because, after 
discovering such overpayment, the responsible plan fi-
duciary— 
‘‘(A) reduces future benefit payments to the 
correct amount provided for under the terms of 
the plan, or 
‘‘(B) seeks recovery from the person or per-
sons responsible for the overpayment. 
‘‘(3) EMPLOYER FUNDING OBLIGATIONS.—Noth-
ing in this subsection shall relieve an employer of any
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† HR 2617 EAS2 
obligation imposed on it to make contributions to a 
plan to meet the minimum funding standards under 
part 3 of this subtitle B or to prevent or restore an 
impermissible forfeiture in accordance with section 
203. 
‘‘(4) RECOUPMENT
FROM
PARTICIPANTS
AND 
BENEFICIARIES.—If the responsible plan fiduciary, in 
the exercise of its fiduciary discretion, decides to seek 
recoupment from a participant or beneficiary of all 
or part of an inadvertent benefit overpayment made 
by the plan to such participant or beneficiary, it may 
do so, subject to the following conditions: 
‘‘(A) No interest or other additional 
amounts (such as collection costs or fees) are 
sought on overpaid amounts for any period. 
‘‘(B) If the plan seeks to recoup past over-
payments of a non-decreasing annuity by reduc-
ing future benefit payments— 
‘‘(i) the reduction ceases after the plan 
has recovered the full dollar amount of the 
overpayment, 
‘‘(ii) the amount recouped each cal-
endar year does not exceed 10 percent of the 
full dollar amount of the overpayment, and
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† HR 2617 EAS2 
‘‘(iii) future benefit payments are not 
reduced to below 90 percent of the periodic 
amount otherwise payable under the terms 
of the plan. 
Alternatively, if the plan seeks to recoup past 
overpayments of a non-decreasing annuity 
through one or more installment payments, the 
sum of such installment payments in any cal-
endar year does not exceed the sum of the reduc-
tions that would be permitted in such year under 
the preceding sentence. 
‘‘(C) If the plan seeks to recoup past over-
payments of a benefit other than a non-decreas-
ing annuity, the plan satisfies requirements de-
veloped by the Secretary of Labor for purposes of 
this subparagraph. 
‘‘(D) Efforts to recoup overpayments are— 
‘‘(i) not accompanied by threats of liti-
gation, unless the responsible plan fiduciary 
makes a determination that there is a rea-
sonable likelihood of success to recover an 
amount greater than the cost of recovery, 
and 
‘‘(ii) not made through a collection 
agency or similar third party, unless the
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† HR 2617 EAS2 
participant or beneficiary ignores or rejects 
efforts to recoup the overpayment following 
either a final judgment in Federal or State 
court or a settlement between the partici-
pant or beneficiary and the plan, in either 
case authorizing such recoupment. 
‘‘(E) Recoupment of past overpayments to a 
participant is not sought from any beneficiary of 
the participant, including a spouse, surviving 
spouse, former spouse, or other beneficiary. 
‘‘(F) Recoupment may not be sought if the 
first overpayment occurred more than 3 years be-
fore the participant or beneficiary is first noti-
fied in writing of the error, except in the case of 
fraud or misrepresentation by the participant. 
‘‘(G) A participant or beneficiary from 
whom recoupment is sought is entitled to contest 
all or part of the recoupment pursuant to the 
claims procedures of the plan that made the 
overpayment to the extent such procedures are 
consistent with section 503 of this title and in 
the case of an inadvertent benefit overpayment 
from a plan to which paragraph (1) applies that 
is transferred to an eligible retirement plan (as 
defined in section 402(c)(8)(B) of the Internal
2169 
† HR 2617 EAS2 
Revenue Code of 1986) by or on behalf of a par-
ticipant or beneficiary— 
‘‘(i) such plan shall notify the plan re-
ceiving the rollover of such dispute, 
‘‘(ii) the plan receiving the rollover 
shall retain such overpayment on behalf of 
the participant or beneficiary (and shall be 
entitled to treat such overpayment as plan 
assets) pending the outcome of such proce-
dures, and 
‘‘(iii) the portion of such overpayment 
with respect to which recoupment is sought 
on behalf of the plan shall be permitted to 
be returned to such plan if it is determined 
to be an overpayment (and the plans mak-
ing and receiving such transfer shall be 
treated as permitting such transfer). 
‘‘(H) 
In 
determining 
the 
amount 
of 
recoupment to seek, the responsible plan fidu-
ciary may take into account the hardship that 
recoupment likely would impose on the partici-
pant or beneficiary. 
‘‘(5) EFFECT OF CULPABILITY.—Subparagraphs 
(A) through (F) of paragraph (4) shall not apply to 
protect a participant or beneficiary who is culpable.
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† HR 2617 EAS2 
For purposes of this paragraph, a participant or ben-
eficiary is culpable if the individual bears responsi-
bility for the overpayment (such as through misrepre-
sentations or omissions that led to the overpayment), 
or if the individual knew that the benefit payment or 
payments were materially in excess of the correct 
amount. Notwithstanding the preceding sentence, an 
individual is not culpable merely because the indi-
vidual believed the benefit payment or payments were 
or might be in excess of the correct amount, if the in-
dividual raised that question with an authorized plan 
representative and was told the payment or payments 
were not in excess of the correct amount.’’. 
(b) OVERPAYMENTS UNDER INTERNAL REVENUE CODE 
OF 1986.— 
(1) 
QUALIFICATION
REQUIREMENTS.—Section 
414 is amended by adding at the end the following 
new subsection: 
‘‘(aa) SPECIAL
RULES
APPLICABLE
TO
BENEFIT 
OVERPAYMENTS.— 
‘‘(1) IN GENERAL.—A plan shall not fail to be 
treated as described in clause (i), (ii), (iii), or (iv) of 
section 219(g)(5)(A) (and shall not fail to be treated 
as satisfying the requirements of section 401(a) or 
403) merely because—
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† HR 2617 EAS2 
‘‘(A) the plan fails to obtain payment from 
any participant, beneficiary, employer, plan 
sponsor, fiduciary, or other party on account of 
any inadvertent benefit overpayment made by 
the plan, or 
‘‘(B) the plan sponsor amends the plan to 
increase past, or decrease future, benefit pay-
ments to affected participants and beneficiaries 
in order to adjust for prior inadvertent benefit 
overpayments. 
‘‘(2) REDUCTION IN FUTURE BENEFIT PAYMENTS 
AND RECOVERY FROM RESPONSIBLE PARTY.—Para-
graph (1) shall not fail to apply to a plan merely be-
cause, after discovering a benefit overpayment, such 
plan— 
‘‘(A) reduces future benefit payments to the 
correct amount provided for under the terms of 
the plan, or 
‘‘(B) seeks recovery from the person or per-
sons responsible for such overpayment. 
‘‘(3) EMPLOYER FUNDING OBLIGATIONS.—Noth-
ing in this subsection shall relieve an employer of any 
obligation imposed on it to make contributions to a 
plan to meet the minimum funding standards under
2172 
† HR 2617 EAS2 
sections 412 and 430 or to prevent or restore an im-
permissible forfeiture in accordance with section 411. 
‘‘(4) OBSERVANCE OF BENEFIT LIMITATIONS.— 
Notwithstanding paragraph (1), a plan to which 
paragraph (1) applies shall observe any limitations 
imposed on it by section 401(a)(17) or 415. The plan 
may enforce such limitations using any method ap-
proved by the Secretary for recouping benefits pre-
viously paid or allocations previously made in excess 
of such limitations. 
‘‘(5) COORDINATION WITH OTHER QUALIFICATION 
REQUIREMENTS.—The Secretary may issue regula-
tions or other guidance of general applicability speci-
fying how benefit overpayments and their recoupment 
or non-recoupment from a participant or beneficiary 
shall be taken into account for purposes of satisfying 
any requirement applicable to a plan to which para-
graph (1) applies.’’. 
(2) ROLLOVERS.—Section 402(c) is amended by 
adding at the end the following new paragraph: 
‘‘(12) In the case of an inadvertent benefit over-
payment from a plan to which section 414(aa)(1) ap-
plies that is transferred to an eligible retirement plan 
by or on behalf of a participant or beneficiary—
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† HR 2617 EAS2 
‘‘(A) the portion of such overpayment with 
respect to which recoupment is not sought on be-
half of the plan shall be treated as having been 
paid in an eligible rollover distribution if the 
payment would have been an eligible rollover 
distribution but for being an overpayment, and 
‘‘(B) the portion of such overpayment with 
respect to which recoupment is sought on behalf 
of the plan shall be permitted to be returned to 
such plan and in such case shall be treated as 
an eligible rollover distribution transferred to 
such plan by the participant or beneficiary who 
received such overpayment (and the plans mak-
ing and receiving such transfer shall be treated 
as permitting such transfer).’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply as of the date of the enactment of this 
Act. 
(d) CERTAIN ACTIONS BEFORE DATE
OF ENACT-
MENT.—Plans, fiduciaries, employers, and plan sponsors 
are entitled to rely on— 
(1) a reasonable good faith interpretation of then 
existing administrative guidance for inadvertent ben-
efit overpayment recoupments and recoveries that
2174 
† HR 2617 EAS2 
commenced before the date of enactment of this Act, 
and 
(2) determinations made before the date of enact-
ment of this Act by the responsible plan fiduciary, in 
the exercise of its fiduciary discretion, not to seek 
recoupment or recovery of all or part of an inad-
vertent benefit overpayment. 
In the case of a benefit overpayment that occurred prior 
to the date of enactment of this Act, any installment pay-
ments by the participant or beneficiary to the plan or any 
reduction in periodic benefit payments to the participant 
or beneficiary, which were made in recoupment of such 
overpayment and which commenced prior to such date, may 
continue after such date. Nothing in this subsection shall 
relieve a fiduciary from responsibility for an overpayment 
that resulted from a breach of its fiduciary duties. 
SEC. 302. REDUCTION IN EXCISE TAX ON CERTAIN ACCUMU-
LATIONS IN QUALIFIED RETIREMENT PLANS. 
(a) IN GENERAL.—Section 4974(a) is amended by 
striking ‘‘50 percent’’ and inserting ‘‘25 percent’’. 
(b) REDUCTION IN EXCISE TAX ON FAILURES TO TAKE 
REQUIRED MINIMUM DISTRIBUTIONS.—Section 4974 is 
amended by adding at the end the following new subsection: 
‘‘(e) REDUCTION OF TAX IN CERTAIN CASES.—
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† HR 2617 EAS2 
‘‘(1) REDUCTION.—In the case of a taxpayer 
who— 
‘‘(A) receives a distribution, during the cor-
rection window, of the amount which resulted in 
imposition of a tax under subsection (a) from the 
same plan to which such tax relates, and 
‘‘(B) submits a return, during the correc-
tion window, reflecting such tax (as modified by 
this subsection), 
the first sentence of subsection (a) shall be applied by 
substituting ‘10 percent’ for ‘25 percent’. 
‘‘(2) CORRECTION
WINDOW.—For purposes of 
this subsection, the term ‘correction window’ means 
the period of time beginning on the date on which the 
tax under subsection (a) is imposed with respect to a 
shortfall of distributions from a plan described in 
subsection (a), and ending on the earliest of— 
‘‘(A) the date of mailing a notice of defi-
ciency with respect to the tax imposed by sub-
section (a) under section 6212, 
‘‘(B) the date on which the tax imposed by 
subsection (a) is assessed, or 
‘‘(C) the last day of the second taxable year 
that begins after the end of the taxable year in 
which the tax under subsection (a) is imposed.’’.
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† HR 2617 EAS2 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after the date 
of the enactment of this Act. 
SEC. 303. RETIREMENT SAVINGS LOST AND FOUND. 
(a) IN GENERAL.—Part 5 of subtitle B of title I of 
the Employee Retirement Income Security Act of 1974 (29 
U.S.C. 1131 et seq.) is amended by adding at the end the 
following: 
‘‘SEC. 523. RETIREMENT SAVINGS LOST AND FOUND. 
‘‘(a) ESTABLISHMENT.— 
‘‘(1) IN GENERAL.—Not later than 2 years after 
the date of the enactment of this section, the Sec-
retary, in consultation with the Secretary of the 
Treasury, shall establish an online searchable data-
base (to be managed by the Secretary in accordance 
with this section) to be known as the ‘Retirement Sav-
ings Lost and Found’. The Retirement Savings Lost 
and Found shall— 
‘‘(A) allow an individual to search for in-
formation that enables the individual to locate 
the administrator of any plan described in para-
graph (2) with respect to which the individual is 
or was a participant or beneficiary, and provide 
contact information for the administrator of any 
such plan;
2177 
† HR 2617 EAS2 
‘‘(B) allow the Secretary to assist such an 
individual in locating any such plan of the indi-
vidual; and 
‘‘(C) allow the Secretary to make any nec-
essary changes to contact information on record 
for the administrator based on any changes to 
the plan due to merger or consolidation of the 
plan with any other plan, division of the plan 
into two or more plans, bankruptcy, termi-
nation, change in name of the plan, change in 
name or address of the administrator, or other 
causes. 
‘‘(2) PLANS DESCRIBED.—A plan described in 
this paragraph is a plan to which the vesting stand-
ards of section 203 apply. 
‘‘(b) ADMINISTRATION.—The Retirement Savings Lost 
and Found established under subsection (a) shall provide 
individuals described in subsection (a)(1) only with the 
ability to search for information that enables the individual 
to locate the administrator and contact information for the 
administrator of any plan with respect to which the indi-
vidual is or was a participant or beneficiary, sufficient to 
allow the individual to locate the individual’s plan in order 
to make a claim for benefits owing to the individual under 
the plan.
2178 
† HR 2617 EAS2 
‘‘(c) SAFEGUARDING PARTICIPANT PRIVACY AND SE-
CURITY.—In establishing the Retirement Savings Lost and 
Found under subsection (a), the Secretary, in consultation 
with the Secretary of the Treasury, shall take all necessary 
and proper precautions to— 
‘‘(1) ensure that individuals’ plan and personal 
information maintained by the Retirement Savings 
Lost and Found is protected; and 
‘‘(2) allow any individual to contact the Sec-
retary to opt out of inclusion in the Retirement Sav-
ings Lost and Found. 
‘‘(d) DEFINITION OF ADMINISTRATOR.—For purposes 
of this section, the term ‘administrator’ has the meaning 
given such term in section 3(16)(A). 
‘‘(e) INFORMATION COLLECTION FROM PLANS.—Effec-
tive with respect to plan years beginning after the second 
December 31 occurring after the date of the enactment of 
this subsection, the administrator of a plan to which the 
vesting standards of section 203 apply shall submit to the 
Secretary, at such time and in such form and manner as 
is prescribed in regulations— 
‘‘(1) the information described in paragraphs (1) 
through (4) of section 6057(b) of the Internal Revenue 
Code of 1986;
2179 
† HR 2617 EAS2 
‘‘(2) the information described in subparagraphs 
(A) and (B) of section 6057(a)(2) of such Code; 
‘‘(3) the name and taxpayer identifying number 
of each participant or former participant in the 
plan— 
‘‘(A) who, during the current plan year or 
any previous plan year, was reported under sec-
tion 6057(a)(2)(C) of such Code, and with re-
spect to whom the benefits described in clause 
(ii) thereof were fully paid during the plan year; 
‘‘(B) with respect to whom any amount was 
distributed under section 401(a)(31)(B) of such 
Code during the plan year; or 
‘‘(C) with respect to whom a deferred annu-
ity contract was distributed during the plan 
year; and 
‘‘(4) in the case of a participant or former par-
ticipant to whom paragraph (3) applies— 
‘‘(A) in the case of a participant described 
in subparagraph (B) thereof, the name and ad-
dress of the designated trustee or issuer described 
in section 401(a)(31)(B)(i) of such Code and the 
account number of the individual retirement 
plan to which the amount was distributed; and
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† HR 2617 EAS2 
‘‘(B) in the case of a participant described 
in subparagraph (C) thereof, the name and ad-
dress of the issuer of such annuity contract and 
the contract or certificate number. 
‘‘(f) USE OF INFORMATION COLLECTED.—The Sec-
retary— 
‘‘(1) may use or disclose information collected 
under this section only for the purpose described in 
subsection (a)(1)(B), and 
‘‘(2) may disclose such information only to such 
employees of the Department of Labor whose official 
duties relate to the purpose described in such sub-
section. 
‘‘(g) PROGRAM INTEGRITY AUDIT.—On an annual 
basis for each of the first 5 years beginning one year after 
the establishment of the database in subsection (a)(1) and 
every 5 years thereafter, the Inspector General of the De-
partment of Labor shall— 
‘‘(1) conduct an audit of the administration of 
the Retirement Savings Lost and Found; and 
‘‘(2) submit a report on such audit to the Com-
mittee on Health, Education, Labor, and Pensions 
and the Committee on Finance of the Senate and the 
Committee on Ways and Means and the Committee
2181 
† HR 2617 EAS2 
on Education and Labor of the House of Representa-
tives.’’. 
(b) CONFORMING AMENDMENT.—The table of contents 
for the Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1001 et seq.) is amended by inserting after the 
item relating to section 522 the following: 
‘‘Sec. 523. Retirement Savings Lost and Found.’’. 
SEC. 304. UPDATING DOLLAR LIMIT FOR MANDATORY DIS-
TRIBUTIONS. 
(a) IN GENERAL.—Section 203(e)(1) of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C. 
1053(e)(1)) 
and 
sections 
401(a)(31)(B)(ii) 
and 
411(a)(11)(A) are each amended by striking ‘‘$5,000’’ and 
inserting ‘‘$7,000’’. 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall apply to distributions made after December 31, 
2023. 
SEC. 305. EXPANSION OF EMPLOYEE PLANS COMPLIANCE 
RESOLUTION SYSTEM. 
(a) IN GENERAL.—Except as otherwise provided in the 
Internal Revenue Code of 1986, regulations, or other guid-
ance of general applicability prescribed by the Secretary of 
the Treasury or the Secretary’s delegate (referred to in this 
section as the ‘‘Secretary’’), any eligible inadvertent failure 
to comply with the rules applicable under section 401(a), 
403(a), 403(b), 408(p), or 408(k) of such Code may be self-
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corrected under the Employee Plans Compliance Resolution 
System (as described in Revenue Procedure 2021–30, or 
any successor guidance, and hereafter in this section re-
ferred to as the ‘‘EPCRS’’), except to the extent that (1) 
such failure was identified by the Secretary prior to any 
actions which demonstrate a specific commitment to imple-
ment a self-correction with respect to such failure, or (2) 
the self-correction is not completed within a reasonable pe-
riod after such failure is identified. For purposes of self- 
correction of an eligible inadvertent failure, the correction 
period under section 9.02 of Revenue Procedure 2021–30 
(or any successor guidance), except as otherwise provided 
under such Code, regulations, or other guidance of general 
applicability prescribed by the Secretary, is indefinite and 
has no last day, other than with respect to failures identi-
fied by the Secretary prior to any actions which dem-
onstrate a specific commitment to implement a self-correc-
tion with respect to such failure or with respect to a self- 
correction that is not completed within a reasonable period, 
as described in the preceding sentence. 
(b) LOAN ERRORS.—In the case of an eligible inad-
vertent failure relating to a loan from a plan to a partici-
pant— 
(1) such failure may be self-corrected under sub-
section (a) according to the rules of section 6.07 of
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Revenue Procedure 2021–30 (or any successor guid-
ance), including the provisions related to whether a 
deemed distribution must be reported on Form 1099– 
R, 
(2) the Secretary of Labor shall treat any such 
failure which is so self-corrected under subsection (a) 
as meeting the requirements of the Voluntary Fidu-
ciary Correction Program of the Department of Labor 
if, with respect to the violation of the fiduciary stand-
ards of the Employee Retirement Income Security Act 
of 1974, there is a similar loan error eligible for cor-
rection under EPCRS and the loan error is corrected 
in such manner, and 
(3) the Secretary of Labor may impose reporting 
or other procedural requirements with respect to par-
ties that intend to rely on the Voluntary Fiduciary 
Correction Program for self-corrections described in 
paragraph (2). 
(c) EPCRS FOR IRAS.—The Secretary shall expand 
the EPCRS to allow custodians of individual retirement 
plans (as defined in section 7701(a)(37) of the Internal 
Revenue Code of 1986) to address eligible inadvertent fail-
ures with respect to an individual retirement plan (as so 
defined), including (but not limited to)—
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(1) waivers of the excise tax which would other-
wise apply under section 4974 of the Internal Rev-
enue Code of 1986, and 
(2) rules permitting a nonspouse beneficiary to 
return distributions to an inherited individual retire-
ment plan described in section 408(d)(3)(C) of the In-
ternal Revenue Code of 1986 in a case where, due to 
an inadvertent error by a service provider, the bene-
ficiary had reason to believe that the distribution 
could be rolled over without inclusion in income of 
any part of the distributed amount. 
(d) CORRECTION METHODS
FOR ELIGIBLE INAD-
VERTENT FAILURES.—The Secretary shall issue guidance 
on correction methods that are required to be used to correct 
eligible inadvertent failures, including general principles of 
correction if a specific correction method is not specified 
by the Secretary. 
(e) ELIGIBLE INADVERTENT FAILURE.—For purposes 
of this section— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the term ‘‘eligible inadvertent failure’’ 
means a failure that occurs despite the existence of 
practices and procedures which—
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(A) satisfy the standards set forth in section 
4.04 of Revenue Procedure 2021–30 (or any suc-
cessor guidance), or 
(B) satisfy similar standards in the case of 
an individual retirement plan. 
(2) EXCEPTION.—The term ‘‘eligible inadvertent 
failure’’ shall not include any failure which is egre-
gious, relates to the diversion or misuse of plan assets, 
or is directly or indirectly related to an abusive tax 
avoidance transaction. 
(f) APPLICATION OF CERTAIN REQUIREMENTS FOR 
CORRECTING ERRORS.—This section shall not apply to any 
failure unless the correction of such failure under this sec-
tion is made in conformity with the general principles that 
apply to corrections of such failures under the Internal Rev-
enue Code of 1986, including regulations or other guidance 
issued thereunder and including those principles and cor-
rections set forth in Revenue Procedure 2021–30 (or any 
successor guidance). 
(g) ISSUANCE OF GUIDANCE.—The Secretary of the 
Treasury, or the Secretary’s delegate, shall revise Revenue 
Procedure 2021–30 (or any successor guidance) to take into 
account the provisions of this section not later than the date 
which is 2 years after the date of enactment of this Act.
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SEC. 306. ELIMINATE THE ‘‘FIRST DAY OF THE MONTH’’ RE-
QUIREMENT FOR GOVERNMENTAL SECTION 
457(b) PLANS. 
(a) IN GENERAL.—Section 457(b)(4) is amended to 
read as follows: 
‘‘(4) which provides that compensation— 
‘‘(A) in the case of an eligible employer de-
scribed in subsection (e)(1)(A), will be deferred 
only if an agreement providing for such deferral 
has been entered into before the compensation is 
currently available to the individual, and 
‘‘(B) in any other case, will be deferred for 
any calendar month only if an agreement pro-
viding for such deferral has been entered into be-
fore the beginning of such month,’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to taxable years beginning after the date 
of the enactment of this Act. 
SEC. 307. ONE-TIME ELECTION FOR QUALIFIED CHARI-
TABLE DISTRIBUTION TO SPLIT-INTEREST 
ENTITY; INCREASE IN QUALIFIED CHARI-
TABLE DISTRIBUTION LIMITATION. 
(a) ONE-TIME ELECTION FOR QUALIFIED CHARITABLE 
DISTRIBUTION
TO
SPLIT-INTEREST
ENTITY.—Section 
408(d)(8) is amended by adding at the end the following 
new subparagraph:
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‘‘(F) ONE-TIME ELECTION FOR QUALIFIED 
CHARITABLE DISTRIBUTION TO SPLIT-INTEREST 
ENTITY.— 
‘‘(i) IN
GENERAL.—A taxpayer may 
for a taxable year elect under this subpara-
graph to treat as meeting the requirement of 
subparagraph (B)(i) any distribution from 
an individual retirement account which is 
made directly by the trustee to a split-inter-
est entity, but only if— 
‘‘(I) an election is not in effect 
under this subparagraph for a pre-
ceding taxable year, 
‘‘(II) the aggregate amount of dis-
tributions of the taxpayer with respect 
to which an election under this sub-
paragraph is made does not exceed 
$50,000, and 
‘‘(III) such distribution meets the 
requirements of clauses (iii) and (iv). 
‘‘(ii) SPLIT-INTEREST
ENTITY.—For 
purposes of this subparagraph, the term 
‘split-interest entity’ means— 
‘‘(I) a charitable remainder annu-
ity 
trust 
(as 
defined 
in 
section
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664(d)(1)), but only if such trust is 
funded exclusively by qualified chari-
table distributions, 
‘‘(II) 
a 
charitable 
remainder 
unitrust 
(as 
defined 
in 
section 
664(d)(2)), but only if such unitrust is 
funded exclusively by qualified chari-
table distributions, or 
‘‘(III) a charitable gift annuity 
(as defined in section 501(m)(5)), but 
only if such annuity is funded exclu-
sively by qualified charitable distribu-
tions and commences fixed payments of 
5 percent or greater not later than 1 
year from the date of funding. 
‘‘(iii) CONTRIBUTIONS MUST BE OTH-
ERWISE
DEDUCTIBLE.—A 
distribution 
meets the requirements of this clause only 
if— 
‘‘(I) in the case of a distribution 
to a charitable remainder annuity 
trust 
or 
a 
charitable 
remainder 
unitrust, a deduction for the entire 
value of the remainder interest in the 
distribution for the benefit of a speci-
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fied charitable organization would be 
allowable under section 170 (deter-
mined without regard to subsection (b) 
thereof and this paragraph), and 
‘‘(II) in the case of a charitable 
gift annuity, a deduction in an 
amount equal to the amount of the dis-
tribution reduced by the value of the 
annuity 
described 
in 
section 
501(m)(5)(B) would be allowable under 
section 170 (determined without regard 
to subsection (b) thereof and this para-
graph). 
‘‘(iv) LIMITATION ON INCOME INTER-
ESTS.—A distribution meets the require-
ments of this clause only if— 
‘‘(I) no person holds an income 
interest in the split-interest entity 
other than the individual for whose 
benefit such account is maintained, the 
spouse of such individual, or both, and 
‘‘(II) the income interest in the 
split-interest entity is nonassignable. 
‘‘(v) SPECIAL RULES.—
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‘‘(I) 
CHARITABLE
REMAINDER 
TRUSTS.—Notwithstanding 
section 
664(b), distributions made from a trust 
described in subclause (I) or (II) of 
clause (ii) shall be treated as ordinary 
income in the hands of the beneficiary 
to whom the annuity described in sec-
tion 664(d)(1)(A) or the payment de-
scribed in section 664(d)(2)(A) is paid. 
‘‘(II) CHARITABLE
GIFT
ANNU-
ITIES.—Qualified charitable distribu-
tions made to fund a charitable gift 
annuity shall not be treated as an in-
vestment in the contract for purposes of 
section 72(c).’’. 
(b) INFLATION ADJUSTMENT.—Section 408(d)(8), as 
amended by subsection (a), is further amended by adding 
at the end the following new subparagraph: 
‘‘(G) INFLATION ADJUSTMENT.— 
‘‘(i) IN GENERAL.—In the case of any 
taxable year beginning after 2023, each of 
the dollar amounts in subparagraphs (A) 
and (F) shall be increased by an amount 
equal to—
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‘‘(I) such dollar amount, multi-
plied by 
‘‘(II) the cost-of-living adjustment 
determined under section 1(f)(3) for 
the calendar year in which the taxable 
year begins, determined by substituting 
‘calendar year 2022’ for ‘calendar year 
2016’ in subparagraph (A)(ii) thereof. 
‘‘(ii) 
ROUNDING.—If 
any 
dollar 
amount increased under clause (i) is not a 
multiple of $1,000, such dollar amount shall 
be rounded to the nearest multiple of 
$1,000.’’. 
(c) EFFECTIVE DATE.—The amendment made by this 
section shall apply to distributions made in taxable years 
beginning after the date of the enactment of this Act. 
SEC. 308. DISTRIBUTIONS TO FIREFIGHTERS. 
(a) IN
GENERAL.—Subparagraph (A) of section 
72(t)(10) is amended by striking ‘‘414(d))’’ and inserting 
‘‘414(d)) or a distribution from a plan described in clause 
(iii), (iv), or (vi) of section 402(c)(8)(B) to an employee 
who provides firefighting services’’. 
(b) CONFORMING AMENDMENT.—The heading of para-
graph (10) of section 72(t) is amended by striking ‘‘IN GOV-
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† HR 2617 EAS2 
ERNMENTAL PLANS’’ and inserting ‘‘AND PRIVATE SECTOR 
FIREFIGHTERS’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to distributions made after the date of 
the enactment of this Act. 
SEC. 309. EXCLUSION OF CERTAIN DISABILITY-RELATED 
FIRST RESPONDER RETIREMENT PAYMENTS. 
(a) IN GENERAL.—Part III of subchapter B of chapter 
1 is amended by inserting after section 139B the following 
new section: 
‘‘SEC. 
139C. 
CERTAIN 
DISABILITY-RELATED 
FIRST 
RE-
SPONDER RETIREMENT PAYMENTS. 
‘‘(a) IN GENERAL.—In the case of an individual who 
receives qualified first responder retirement payments for 
any taxable year, gross income shall not include so much 
of such payments as do not exceed the annualized excludable 
disability amount with respect to such individual. 
‘‘(b) QUALIFIED FIRST RESPONDER RETIREMENT 
PAYMENTS.—For purposes of this section, the term ‘quali-
fied first responder retirement payments’ means, with re-
spect to any taxable year, any pension or annuity which 
but for this section would be includible in gross income for 
such taxable year and which is received— 
‘‘(1) from a plan described in clause (iii), (iv), 
(v), or (vi) of section 402(c)(8)(B), and
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‘‘(2) in connection with such individual’s quali-
fied first responder service. 
‘‘(c) 
ANNUALIZED
EXCLUDABLE
DISABILITY 
AMOUNT.—For purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘annualized exclud-
able disability amount’ means, with respect to any 
individual, the service-connected excludable disability 
amounts which are properly attributable to the 12- 
month period immediately preceding the date on 
which such individual attains retirement age. 
‘‘(2) SERVICE-CONNECTED
EXCLUDABLE
DIS-
ABILITY
AMOUNT.—The term ‘service-connected ex-
cludable disability amount’ means periodic payments 
received by an individual which— 
‘‘(A) are not includible in such individual’s 
gross income under section 104(a)(1), 
‘‘(B) are received in connection with such 
individual’s qualified first responder service, and 
‘‘(C) terminate when such individual at-
tains retirement age. 
‘‘(3) SPECIAL
RULE
FOR
PARTIAL-YEAR
PAY-
MENTS.—In the case of an individual who only re-
ceives service-connected excludable disability amounts 
properly attributable to a portion of the 12-month pe-
riod described in paragraph (1), such paragraph shall
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† HR 2617 EAS2 
be applied by multiplying such amounts by the ratio 
of 365 to the number of days in such period to which 
such amounts were properly attributable. 
‘‘(d) QUALIFIED FIRST RESPONDER SERVICE.—For 
purposes of this section, the term ‘qualified first responder 
service’ means service as a law enforcement officer, fire-
fighter, paramedic, or emergency medical technician.’’. 
(b) CLERICAL AMENDMENT.—The table of sections for 
part III of subchapter B of chapter 1 is amended by insert-
ing after the item relating to section 139B the following 
new item: 
‘‘Sec. 139C. Certain disability-related first responder retirement payments.’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to amounts received with respect to tax-
able years beginning after December 31, 2026. 
SEC. 310. APPLICATION OF TOP HEAVY RULES TO DEFINED 
CONTRIBUTION PLANS COVERING EXCLUD-
ABLE EMPLOYEES. 
(a) IN GENERAL.—Paragraph (2) of section 416(c) is 
amended by adding at the end the following new subpara-
graph: 
‘‘(C) APPLICATION
TO
EMPLOYEES
NOT 
MEETING AGE AND SERVICE REQUIREMENTS.— 
Any employees not meeting the age or service re-
quirements of section 410(a)(1) (without regard 
to subparagraph (B) thereof) may be excluded