I 
109TH CONGRESS 
1ST SESSION H. R. 2831 
To amend title I of the Employee Retirement Income Security Act of 1974 
and the Internal Revenue Code of 1986 to make improvements in benefit 
accrual standards. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 9, 2005 
Mr. BOEHNER introduced the following bill; which was referred to the Com-
mittee on Education and the Workforce, and in addition to the Com-
mittee on Ways and Means, for a period to be subsequently determined 
by the Speaker, in each case for consideration of such provisions as fall 
within the jurisdiction of the committee concerned 
A BILL 
To amend title I of the Employee Retirement Income Secu-
rity Act of 1974 and the Internal Revenue Code of 
1986 to make improvements in benefit accrual standards. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Pension Preservation 
and Portability Act of 2005’’. 
SEC. 2. IMPROVEMENTS IN BENEFIT ACCRUAL STANDARDS. 
(a) AMENDMENTS TO THE EMPLOYEE RETIREMENT 
INCOME SECURITY ACT OF 1974.—
(1) RULES RELATING TO REDUCTION IN AC-
CRUED BENEFITS BECAUSE OF ATTAINMENT OF ANY 
AGE.—Section 204(b)(1)(H) of the Employee Retire-
ment Income Security Act of 1974 (29 U.S.C. 
1054(b)(1)(H)) is amended by adding at the end the 
following new clauses: 
‘‘(vii)(I) A plan complies with clause (i) if a partici-
pant’s entire accrued benefit, as determined as of any date 
under the formula for determining benefits as set forth 
in the text of the plan documents, would be equal to or 
greater than that of any similarly situated, younger indi-
vidual. 
‘‘(II) For purposes of this clause, an individual is 
similarly situated to a participant if such individual is 
identical to such participant in every respect (including pe-
riod of service, compensation, position, date of hire, work 
history, and any other respect) except for age. 
‘‘(III) In determining the entire accrued benefit for 
purposes of this clause, the subsidized portion of any early 
retirement benefit (including any early retirement subsidy 
that is fully or partially included or reflected in an employ-
ee’s opening balance or other transition benefits) shall be 
disregarded. 
‘‘(viii) A plan shall not be treated as failing to meet 
the requirements of this subparagraph solely because the
plan provides allowable offsets against those benefits 
under the plan which are attributable to employer con-
tributions, based on benefits which are provided under 
title II of the Social Security Act, the Railroad Retirement 
Act of 1974, or under any retirement program for officers 
or employees of the Federal Government or of the govern-
ment of any State or political subdivision thereof. For pur-
poses of this clause, allowable offsets based on such bene-
fits consist of offsets equal to all or part of the actual 
benefit payment amounts, reasonable projections or esti-
mations of such benefit payment amounts, or actuarial 
equivalents of such actual benefit payment amounts, pro-
jections, or estimations (determined on the basis of rea-
sonable actuarial assumptions). 
‘‘(ix) A plan shall not be treated as failing to meet 
the requirements of this subparagraph solely because the 
plan provides a disparity in contributions or benefits with 
respect to which the requirements of section 401(l) of the 
Internal Revenue Code of 1986 are met. 
‘‘(x)(I) A plan shall not be treated as failing to meet 
the requirements of this subparagraph solely because the 
plan provides for pre-retirement indexing of accrued bene-
fits under the plan. 
‘‘(II) For purposes of this clause, the term ‘pre-re-
tirement indexing’ means, in connection with an accrued
benefit, the periodic adjustment of the accrued benefit by 
means of the application of a recognized index or method-
ology so as to protect the economic value of the benefit 
against inflation prior to distribution.’’. 
(2) DETERMINATIONS OF ACCRUED BENEFIT AS 
BALANCE OF BENEFIT ACCOUNT.—Section 203 of 
such Act (29 U.S.C. 1053) is amended by adding at 
the end the following new subsection: 
‘‘(f)(1) A defined benefit plan under which the ac-
crued benefit payable under the plan upon distribution (or 
any portion thereof) is expressed as the balance of an ac-
count maintained for the participant shall not be treated 
as failing to meet the requirements of subsection (a)(2) 
and section 205(g) solely because of the amount actually 
made available for such distribution under the terms of 
the plan, in any case in which— 
‘‘(A) the applicable interest rate that would be 
required to discount the participant’s accrued benefit 
projected under the terms of the plan to normal re-
tirement age to a present value equal to the amount 
actually made available for distribution under the 
plan is not greater than 
‘‘(B) a market rate of return. 
‘‘(2) The Secretary of the Treasury may provide by 
regulation for rules governing the calculation of a market
rate of return for purposes of paragraph (1) and for per-
missible methods of crediting interest to the account (in-
cluding variable interest rates) resulting in effective rates 
of return meeting the requirements of paragraph (1).’’. 
(b) AMENDMENTS
TO
THE INTERNAL REVENUE 
CODE OF 1986.— 
(1) RULES RELATING TO REDUCTION IN AC-
CRUED BENEFITS BECAUSE OF ATTAINMENT OF ANY 
AGE.—Subparagraph (H) of section 411(b)(1) of the 
Internal Revenue Code of 1986 (relating to contin-
ued accrual beyond normal retirement age) is 
amended— 
(A) by striking the heading and inserting 
the following: ‘‘RULES RELATING TO REDUC-
TION IN ACCRUED BENEFITS BECAUSE OF AT-
TAINMENT OF ANY AGE.—’’; and 
(B) by adding at the end the following: 
‘‘(vi) COMPARISON TO SIMILARLY SIT-
UATED, YOUNGER INDIVIDUALS.— 
‘‘(I) IN GENERAL.—A plan shall 
not be treated as failing to meet the 
requirements of clause (i) if, as of any 
applicable date, a participant’s entire 
accrued benefit, as determined under 
the formula for determining benefits
as set forth in the text of the plan 
documents, would be equal to or 
greater than that of any similarly sit-
uated, younger individual. 
‘‘(II) SIMILARLY SITUATED INDI-
VIDUAL.—For purposes of this clause, 
an individual is similarly situated to a 
participant if such individual is iden-
tical to such participant in every re-
spect (including period of service, 
compensation, position, date of hire, 
work history, and any other respect) 
except for age. 
‘‘(III) SUBSIDIZED PORTION OF 
EARLY
RETIREMENT
BENEFIT
DIS-
REGARDED.—In determining the en-
tire accrued benefit for purposes of 
this clause, the subsidized portion of 
any early retirement benefit shall be 
disregarded. 
‘‘(vii) ALLOWABLE OFFSETS.—A plan 
shall not be treated as failing to meet the 
requirements of this subparagraph solely 
because the plan provides allowable offsets 
against those benefits under the plan
which are attributable to employer con-
tributions, based on benefits which are pro-
vided— 
‘‘(I) under title II of the Social 
Security Act, the Railroad Retirement 
Act of 1974, or under any retirement 
program for officers or employees of 
the Federal Government or of the gov-
ernment of any State or political sub-
division thereof, or 
‘‘(II) under another defined ben-
efit plan which meets the require-
ments of this subparagraph or a de-
fined contribution plan which meets 
the requirements of paragraph (2), if 
such offset is determined under a for-
mula which does not provide for the 
commencement of, or any increase in, 
the offset upon the attainment of any 
specified age of the participant. 
For purposes of this clause, allowable off-
sets based on such benefits consist of off-
sets equal to the actual benefit payment 
amounts, reasonable projections or esti-
mations of such benefit payment amounts,
or actuarial equivalents of such actual ben-
efit payment amounts, projections, or esti-
mations (determined on the basis of rea-
sonable actuarial assumptions). 
‘‘(viii) COMPLIANCE WITH RULES PER-
MITTING
DISPARITY
IN
PLAN
CONTRIBU-
TIONS OR BENEFITS.—A plan shall not be 
treated as failing to meet the requirements 
of this subparagraph solely because the 
plan provides a disparity in contributions 
or benefits with respect to which the re-
quirements of section 401(l) are met. 
‘‘(ix) PRE-RETIREMENT INDEXING.— 
‘‘(I) IN GENERAL.—A plan shall 
not be treated as failing to meet the 
requirements of this subparagraph 
solely because the plan provides for 
pre-retirement indexing of accrued 
benefits under the plan. 
‘‘(II) 
DEFINITION.—For 
pur-
poses of this clause, the term ‘pre-re-
tirement indexing’ means, in connec-
tion with an accrued benefit, the peri-
odic adjustment of the accrued benefit 
by means of the application of a rec-
ognized index or methodology so as to 
protect the economic value of the ben-
efit against inflation prior to distribu-
tion.’’. 
(2) DETERMINATIONS OF ACCRUED BENEFIT AS 
BALANCE OF BENEFIT ACCOUNT.—Subsection (a) of 
section 411 of such Code (relating to minimum vest-
ing standards) is amended by adding at the end the 
following new paragraph: 
‘‘(13) MAINTENANCE
OF
NONFORFEITABILITY 
OF BENEFITS EXPRESSED AS ACCOUNT BALANCE.— 
‘‘(A) IN GENERAL.—A defined benefit plan 
under which the accrued benefit payable under 
the plan upon distribution (or any portion 
thereof) is expressed as the balance of an ac-
count maintained for the participant shall not 
be treated as failing to meet the requirements 
of paragraph (2) or 417(e) solely because of the 
amount actually made available for such dis-
tribution under the terms of the plan, in any 
case in which— 
‘‘(i) the applicable interest rate that 
would be required to discount the partici-
pant’s accrued benefit projected under the 
terms of the plan to normal retirement age
to a present value equal to the amount ac-
tually made available for distribution under 
the plan is not greater than 
‘‘(ii) a market rate of return. 
‘‘(B) REGULATIONS.—The Secretary may 
provide by regulation for rules governing the 
calculation of a market rate of return for pur-
poses of subparagraph (A) and for permissible 
methods of crediting interest to the account (in-
cluding variable interest rates) resulting in ef-
fective rates of return meeting the requirements 
of subparagraph (A).’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning before, on, 
or after the date of the enactment of this Act. 
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