EARN Act
Bill: S.4808 | Sponsor: Sen. Wyden, Ron (D-OR)
Policy area: Taxation

Summary:
Enhancing American Retirement Now Act or the EARN Act
This bill revises or establishes new tax provisions relating to retirement plans for individuals, retirees, public safety officers and military personnel, disaster relief, and employer plans.
The bill revises various provisions relating to individual retirement plans, including provisions to (1) establish a safe harbor for automatic enrollment plans; (2) allow a refundable income tax credit, up to $1,000, for retirement savings contributions; (3) allow penalty-free withdrawals from plans for emergency expenses; (4) modify age requirements for catch-up provisions; (5) allow penalty free withdrawals from plans in domestic abuse cases; (6) allow transfers of plans (portability); and (7) modify the age requirement for ABLE programs for disabled individuals.
The bill makes changes to plans for retirees, including by (1) increasing the age for the start of mandatory plan distributions, (2) reducing the excise tax on certain accumulations in qualified retirement plans, (3) recovering retirement plan overpayments, (4) modifying certain Roth IRA distribution requirements, and (5) allowing plan distributions for individuals with a terminal illness.
The bill modifies provisions relating to retirement plans of public safety offices and military personnel. It allows (1) small employers a tax credit for establishing military spouse retirement plans, (2) penalty-free distributions to firefighters, (3) a tax exclusion for certain disability-related payment for first responders, and (4) an exemption from the early withdrawal penalty for distributions to certain state and local corrections employees.
The bill establishes special tax rules for the use of retirement funds for federally declared disasters.
The bill also modifies or establishes requirements relating to employer plans, including (1) allowing a tax credit for small employers with respect to safe harbor requirements for retirement plans, (2) increasing the credit limitation for small employer pension plan startup costs, (3) reforming family attribution rules, (4) providing for starter 401(k) plans for employers with no retirement plan, (5) allowing a tax credit for small employers that adopt an automatic portability arrangement, (6) modifying Internal Revenue Service mortality tables, (7) extending the period for transferring excess pension assets to retiree heath accounts, and (8) deferring the tax on certain sales of employer stock to employee stock ownership plans sponsored by S corporations.
The bill modifies provisions relating to the retirement of U.S. Tax Court judges, including participation in the Thrift Savings Plan.

To amend the Internal Revenue Code of 1986 to reform retirement 
                  provisions, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE, ETC.

    (a) Short Title.--This Act may be cited as the ``Enhancing American 
Retirement Now Act'' or the ``EARN Act''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.
    (c) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title, etc.
                     TITLE I--INDIVIDUAL RETIREMENT

Sec. 101. Secure deferral arrangements.
Sec. 102. Matching payments for elective deferral and IRA contributions 
                            by certain individuals.
Sec. 103. Modification of participation requirements for long-term, 
                            part-time workers.
Sec. 104. Treatment of student loan payments as elective deferrals for 
                            purposes of matching contributions.
Sec. 105. Withdrawals for certain emergency expenses.
Sec. 106. Allow additional nonelective contributions to simple plans.
Sec. 107. Small immediate financial incentives for contributing to a 
                            plan.
Sec. 108. Indexing IRA catch-up limit.
Sec. 109. Higher catch-up limit to apply at age 60, 61, 62, and 63.
Sec. 110. Eliminate the ``first day of the month'' requirement for 
                            governmental section 457(b) plans.
Sec. 111. Tax treatment of certain nontrade or business SEP 
                            contributions.
Sec. 112. Elimination of additional tax on corrective distributions of 
                            excess contributions.
Sec. 113. Employer may rely on employee certifying that deemed hardship 
                            distribution conditions are met.
Sec. 114. Penalty-free withdrawals from retirement plans for 
                            individuals in case of domestic abuse.
Sec. 115. Amendments to increase benefit accruals under plan for 
                            previous plan year allowed until employer 
                            tax return due date.
Sec. 116. Retroactive first year elective deferrals for sole 
                            proprietors.
Sec. 117. Treasury guidance on rollovers.
Sec. 118. Exemption for automatic portability transactions.
Sec. 119. Application of section 415 limit for certain employees of 
                            rural electric cooperatives.
Sec. 120. Insurance-dedicated exchange-traded funds.
Sec. 121. Modification of age requirement for qualified ABLE programs.
Sec. 122. Assist savers in recovering unclaimed savings bonds.
                           TITLE II--RETIREES

Sec. 201. Increase in age for required beginning date for mandatory 
                            distributions.
Sec. 202. Qualifying longevity annuity contracts.
Sec. 203. Remove required minimum distribution barriers for life 
                            annuities.
Sec. 204. Eliminating a penalty on partial annuitization.
Sec. 205. Reduction in excise tax on certain accumulations in qualified 
                            retirement plans.
Sec. 206. Clarification of substantially equal periodic payment rule.
Sec. 207. Recovery of retirement plan overpayments.
Sec. 208. Retirement Savings Lost and Found.
Sec. 209. Roth plan distribution rules.
Sec. 210. One-time election for qualified charitable distribution to 
                            split-interest entity; increase in 
                            qualified charitable distribution 
                            limitation.
Sec. 211. Exception to penalty on early distributions from qualified 
                            plans for individuals with a terminal 
                            illness.
Sec. 212. Surviving spouse election to be treated as employee.
Sec. 213. Long-term care contracts purchased with retirement plan 
                            distributions.
             TITLE III--PUBLIC SAFETY OFFICERS AND MILITARY

Sec. 301. Military spouse retirement plan eligibility credit for small 
                            employers.
Sec. 302. Distributions to firefighters.
Sec. 303. Exclusion of certain disability-related first responder 
                            retirement payments.
Sec. 304. Repeal of direct payment requirement on exclusion from gross 
                            income of distributions from governmental 
                            plans for health and long-term care 
                            insurance.
Sec. 305. Modification of eligible age for exemption from early 
                            withdrawal penalty.
Sec. 306. Exemption from early withdrawal penalty for certain State and 
                            local government corrections employees.
                   TITLE IV--NONPROFITS AND EDUCATORS

Sec. 401. Enhancement of 403(b) plans.
Sec. 402. Hardship withdrawal rules for 403(b) plans.
Sec. 403. Multiple employer 403(b) plans.
                        TITLE V--DISASTER RELIEF

Sec. 501. Special rules for use of retirement funds in connection with 
                            qualified federally declared disasters.
                        TITLE VI--EMPLOYER PLANS

Sec. 601. Credit for employers with respect to modified safe harbor 
                            requirements.
Sec. 602. Application of top heavy rules to defined contribution plans 
                            covering excludable employees.
Sec. 603. Increase in credit limitation for small employer pension plan 
                            startup costs of certain employers.
Sec. 604. Expansion of Employee Plans Compliance Resolution System.
Sec. 605. Application of credit for small employer pension plan startup 
                            costs to employers which join an existing 
                            plan.
Sec. 606. Safe harbor for corrections of employee elective deferral 
                            failures.
Sec. 607. Reform of family attribution rule.
Sec. 608. Contribution limit for simple IRAs.
Sec. 609. Employers allowed to replace simple retirement accounts with 
                            safe harbor 401(k) plans during a year.
Sec. 610. Starter 401(k) plans for employers with no retirement plan.
Sec. 611. Credit for small employers that adapt an automatic 
                            portability arrangement.
Sec. 612. Re-enrollment credit.
Sec. 613. Corrections of mortality tables.
Sec. 614. Enhancing retiree health benefits in pension plans.
Sec. 615. Deferral of tax for certain sales of employer stock to 
                            employee stock ownership plan sponsored by 
                            S corporation.
                           TITLE VII--NOTICES

Sec. 701. Review and report to Congress relating to reporting and 
                            disclosure requirements.
Sec. 702. Report to Congress on section 402(f) notices.
Sec. 703. Eliminating unnecessary plan requirements related to 
                            unenrolled participants.
                  TITLE VIII--TECHNICAL MODIFICATIONS

Sec. 801. Repayment of qualified birth or adoption distribution limited 
                            to 3 years.
Sec. 802. Amendments relating to Setting Every Community Up for 
                            Retirement Enhancement Act of 2019.
Sec. 803. Modification of required minimum distribution rules for 
                            special needs trusts.
                       TITLE IX--PLAN AMENDMENTS

Sec. 901. Provisions relating to plan amendments.
                TITLE X--TAX COURT RETIREMENT PROVISIONS

Sec. 1001. Provisions relating to judges of the Tax Court.
Sec. 1002. Provisions relating to special trial judges of the Tax 
                            Court.
                      TITLE XI--REVENUE PROVISIONS

Sec. 1101. Simple and SEP Roth IRAs.
Sec. 1102. Elective deferrals generally limited to regular contribution 
                            limit.
Sec. 1103. Optional treatment of employer matching or nonelective 
                            contributions as Roth contributions.
Sec. 1104. Charitable conservation easements.

                     TITLE I--INDIVIDUAL RETIREMENT

SEC. 101. SECURE DEFERRAL ARRANGEMENTS.

    (a) In General.--Subsection (k) of section 401 is amended by adding 
at the end the following new paragraph:
            ``(16) Alternative method for secure deferral arrangements 
        to meet nondiscrimination requirements.--
                    ``(A) In general.--A secure deferral arrangement 
                shall be treated as meeting the requirements of 
                paragraph (3)(A)(ii).
                    ``(B) Secure deferral arrangement.--For purposes of 
                this paragraph, the term `secure deferral arrangement' 
                means any cash or deferred arrangement which meets the 
                requirements of subparagraphs (C), (D), and (E) of 
                paragraph (13), except as modified by this paragraph.
                    ``(C) Qualified percentage.--For purposes of this 
                paragraph, in applying paragraph (13)(C) with respect 
                to any employee, the term `qualified percentage' means, 
                in lieu of the meaning given such term in paragraph 
                (13)(C)(iii), any percentage determined under the 
                arrangement if such percentage is applied uniformly and 
                is--
                            ``(i) at least 6 percent, but not greater 
                        than 10 percent, during the period ending on 
                        the last day of the first plan year which 
                        begins after the date on which the first 
                        elective contribution described in paragraph 
                        (13)(C)(i) is made with respect to such 
                        employee,
                            ``(ii) at least 7 percent during the first 
                        plan year following the plan year described in 
                        clause (i),
                            ``(iii) at least 8 percent during the 
                        second plan year following the plan year 
                        described in clause (i),
                            ``(iv) at least 9 percent during the third 
                        plan year following the plan year described in 
                        clause (i), and
                            ``(v) at least 10 percent during any 
                        subsequent plan year.
                    ``(D) Matching contributions.--
                            ``(i) In general.--For purposes of this 
                        paragraph, an arrangement shall be treated as 
                        having met the requirements of paragraph 
                        (13)(D)(i) if and only if the employer makes 
                        matching contributions on behalf of each 
                        employee who is not a highly compensated 
                        employee in an amount equal to the sum of--
                                    ``(I) 100 percent of the elective 
                                contributions of the employee to the 
                                extent such contributions do not exceed 
                                2 percent of compensation,
                                    ``(II) 50 percent of so much of 
                                such contributions as exceed 2 percent 
                                but do not exceed 6 percent of 
                                compensation, plus
                                    ``(III) 20 percent of so much of 
                                such contributions as exceed 6 percent 
                                but do not exceed 10 percent of 
                                compensation.
                            ``(ii) Rules for matching contributions.--
                                    ``(I) In general.--The rate of 
                                matching contributions with respect to 
                                each increment of employee 
                                contributions may be higher than the 
                                rate specified in clause (i) so long as 
                                such rate does not increase as an 
                                employee's rate of elective 
                                contributions increases.
                                    ``(II) Rules relating to 
                                alternative plan designs.--The rules of 
                                paragraph (12)(B)(iii) shall not apply 
                                for purposes of clause (i).''.
    (b) Matching Contributions.--Subsection (m) of section 401 is 
amended by redesignating paragraph (13) as paragraph (14) and by 
inserting after paragraph (12) the following new paragraph:
            ``(13) Alternative method for secure deferral 
        arrangements.--A defined contribution plan shall be treated as 
        meeting the requirements of paragraph (2) with respect to 
        matching contributions if the plan--
                    ``(A) is a secure deferral arrangement (as defined 
                in subsection (k)(16)),
                    ``(B) meets the requirements of clauses (ii) and 
                (iii) of paragraph (11)(B), and
                    ``(C) provides that matching contributions on 
                behalf of any employee may not be made with respect to 
                an employee's contributions or elective deferrals in 
                excess of 10 percent of the employee's compensation.''.
    (c) Conforming Amendments.--
            (1) Clause (ii) of section 401(k)(12)(F) is amended by 
        striking ``or paragraph (13)(D)(i)(I)'' and inserting ``, 
        paragraph (13)(D)(i)(I), or paragraph (16)(D)''.
            (2) Subclause (II) of section 401(k)(15)(B)(i) is amended 
        by striking ``subsection (a)(4), paragraphs (3), (12), and 
        (13)'' and inserting ``paragraphs (3), (12), (13), and (16), 
        subsection (a)(4)''.
            (3) Subparagraph (H) of section 416(g)(4) is amended--
                    (A) in clause (i), by striking ``section 401(k)(12) 
                or 401(k)(13)'' and inserting ``paragraph (12), (13), 
                or (16) of section 401(k)'', and
                    (B) in clause (ii), by striking ``section 
                401(m)(11) or 401(m)(12)'' and inserting ``paragraph 
                (11), (12), or (13) of section 401(m)''.
    (d) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after December 31, 2023.

SEC. 102. MATCHING PAYMENTS FOR ELECTIVE DEFERRAL AND IRA CONTRIBUTIONS 
              BY CERTAIN INDIVIDUALS.

    (a) In General.--Subchapter B of chapter 65 is amended by adding at 
the end the following new section:

``SEC. 6433. MATCHING PAYMENTS FOR ELECTIVE DEFERRAL AND IRA 
              CONTRIBUTIONS BY CERTAIN INDIVIDUALS.

    ``(a) In General.--
            ``(1) Allowance of credit.--Any eligible individual who 
        makes qualified retirement savings contributions for the 
        taxable year shall be allowed a credit for such taxable year in 
        an amount equal to the applicable percentage of so much of the 
        qualified retirement savings contributions made by such 
        eligible individual for the taxable year as does not exceed 
        $2,000.
            ``(2) Payment of credit.--
                    ``(A) In general.--Except as provided in 
                subparagraph (A), the credit under this section shall 
                be--
                            ``(i) treated as allowed by subpart C of 
                        part IV of subchapter A of chapter 1, and
                            ``(ii) paid by the Secretary as a 
                        contribution (as soon as practicable after the 
                        eligible individual has filed a tax return 
                        making a claim for such credit for the taxable 
                        year) to the applicable retirement savings 
                        vehicle of an eligible individual.
                    ``(B) Exception.--In the case of an eligible 
                individual with respect to whom the credit determined 
                under paragraph (1) is greater than zero but less than 
                $100 for the taxable year, the eligible individual may 
                elect to have subparagraph (A) not apply.
    ``(b) Applicable Percentage.--For purposes of this section--
            ``(1) In general.--Except as provided in paragraph (2), the 
        applicable percentage is 50 percent.
            ``(2) Phaseout.--The percentage under paragraph (1) shall 
        be reduced (but not below zero) by the number of percentage 
        points which bears the same ratio to 50 percentage points as--
                    ``(A) the excess of--
                            ``(i) the taxpayer's modified adjusted 
                        gross income for such taxable year, over
                            ``(ii) the applicable dollar amount, bears 
                        to
                    ``(B) the phaseout range.
        If any reduction determined under this paragraph is not a whole 
        percentage point, such reduction shall be rounded to the next 
        lowest whole percentage point.
            ``(3) Applicable dollar amount; phaseout range.--
                    ``(A) Joint returns and surviving spouses.--Except 
                as provided in subparagraph (B)--
                            ``(i) the applicable dollar amount is 
                        $41,000, and
                            ``(ii) the phaseout range is $30,000.
                    ``(B) Other returns.--In the case of--
                            ``(i) a head of a household (as defined in 
                        section 2(b)), the applicable dollar amount and 
                        the phaseout range shall be \3/4\ of the 
                        amounts applicable under subparagraph (A) (as 
                        adjusted under subsection (h)), and
                            ``(ii) any taxpayer who is not filing a 
                        joint return, who is not a head of a household 
                        (as so defined), and who is not a surviving 
                        spouse (as defined in section 2(a)), the 
                        applicable dollar amount and the phaseout range 
                        shall be \1/2\ of the amounts applicable under 
                        subparagraph (A) (as so adjusted).
    ``(c) Eligible Individual.--For purposes of this section--
            ``(1) In general.--The term `eligible individual' means any 
        individual if such individual has attained the age of 18 as of 
        the close of the taxable year.
            ``(2) Dependents and full-time students not eligible.--The 
        term `eligible individual' shall not include--
                    ``(A) any individual with respect to whom a 
                deduction under section 151 is allowed to another 
                taxpayer for a taxable year beginning in the calendar 
                year in which such individual's taxable year begins, 
                and
                    ``(B) any individual who is a student (as defined 
                in section 152(f)(2)).
            ``(3) Nonresident aliens not eligible.--The term `eligible 
        individual' shall not include any individual who is a 
        nonresident alien individual for any portion of the taxable 
        year unless such individual is treated for such taxable year as 
        a resident of the United States for purposes of chapter 1 by 
        reason of an election under subsection (g) or (h) of section 
        6013.
    ``(d) Qualified Retirement Savings Contributions.--For purposes of 
this section--
            ``(1) In general.--The term `qualified retirement savings 
        contributions' means, with respect to any taxable year, the sum 
        of--
                    ``(A) the amount of the qualified retirement 
                contributions (as defined in section 219(e)) made by 
                the eligible individual,
                    ``(B) the amount of--
                            ``(i) any elective deferrals (as defined in 
                        section 402(g)(3)) of such individual, and
                            ``(ii) any elective deferral of 
                        compensation by such individual under an 
                        eligible deferred compensation plan (as defined 
                        in section 457(b)) of an eligible employer 
                        described in section 457(e)(1)(A), and
                    ``(C) the amount of voluntary employee 
                contributions by such individual to any qualified 
                retirement plan (as defined in section 4974(c)).
        Such term shall not include any amount attributable to a 
        payment under subsection (a)(2).
            ``(2) Reduction for certain distributions.--
                    ``(A) In general.--The qualified retirement savings 
                contributions determined under paragraph (1) for a 
                taxable year shall be reduced (but not below zero) by 
                the aggregate distributions received by the individual 
                during the testing period from any entity of a type to 
                which contributions under paragraph (1) may be made.
                    ``(B) Testing period.--For purposes of subparagraph 
                (A), the testing period, with respect to a taxable 
                year, is the period which includes--
                            ``(i) such taxable year,
                            ``(ii) the 2 preceding taxable years, and
                            ``(iii) the period after such taxable year 
                        and before the due date (including extensions) 
                        for filing the return of tax for such taxable 
                        year.
                    ``(C) Excepted distributions.--There shall not be 
                taken into account under subparagraph (A)--
                            ``(i) any distribution referred to in 
                        section 72(p), 401(k)(8), 401(m)(6), 402(g)(2), 
                        404(k), or 408(d)(4),
                            ``(ii) any distribution to which section 
                        408(d)(3) or 408A(d)(3) applies, and
                            ``(iii) any portion of a distribution if 
                        such portion is transferred or paid in a 
                        rollover contribution (as defined in section 
                        402(c), 403(a)(4), 403(b)(8), 408A(e), or 
                        457(e)(16)) to an account or plan to which 
                        qualified retirement savings contributions can 
                        be made.
                    ``(D) Treatment of distributions received by spouse 
                of individual.--For purposes of determining 
                distributions received by an individual under 
                subparagraph (A) for any taxable year, any distribution 
                received by the spouse of such individual shall be 
                treated as received by such individual if such 
                individual and spouse file a joint return for such 
                taxable year and for the taxable year during which the 
                spouse receives the distribution.
    ``(e) Applicable Retirement Savings Vehicle.--
            ``(1) In general.--The term `applicable retirement savings 
        vehicle' means an account or plan elected by the eligible 
        individual under paragraph (2).
            ``(2) Election.--Any such election to have contributed the 
        amount determined under subsection (a) shall be to an account 
        or plan which--
                    ``(A) is--
                            ``(i) the portion of a plan described in 
                        clause (iii), (iv), (v), or (vi) of section 
                        402(c)(8)(B) which does not consist of a 
                        qualified Roth contribution program (as defined 
                        in section 402A(b)), or
                            ``(ii) an individual retirement plan which 
                        is not a Roth IRA,
                    ``(B) is for the benefit of the eligible 
                individual,
                    ``(C) accepts contributions made under this 
                section, and
                    ``(D) is designated by such individual (in such 
                form and manner as the Secretary may provide).
    ``(f) Other Definitions and Special Rules.--
            ``(1) Modified adjusted gross income.--For purposes of this 
        section, the term `modified adjusted gross income' means 
        adjusted gross income--
                    ``(A) determined without regard to sections 911, 
                931, and 933, and
                    ``(B) determined without regard to any exclusion or 
                deduction allowed for any qualified retirement savings 
                contribution made during the taxable year.
            ``(2) Treatment of contributions.--In the case of any 
        contribution under subsection (a)(2)--
                    ``(A) except as otherwise provided in this section 
                or by the Secretary under regulations, such 
                contribution shall be treated as--
                            ``(i) an elective deferral made by the 
                        individual, if contributed to an applicable 
                        retirement savings vehicle described in 
                        subsection (e)(2)(A)(i), or
                            ``(ii) as an individual retirement plan 
                        contribution made by such individual, if 
                        contributed to such a plan, and
                    ``(B) such contribution shall not be taken into 
                account with respect to any applicable limitation under 
                sections 402(g)(1), 403(b), 408(a)(1), 408(b)(2)(B), 
                408A(c)(2), 414(v)(2), 415(c), or 457(b)(2), and shall 
                be disregarded for purposes of sections 401(a)(4), 
                401(k)(3), 401(k)(11)(B)(i)(III), and 416.
            ``(3) Treatment of qualified plans, etc.--A plan or 
        arrangement to which a contribution is made under this section 
        shall not be treated as violating any requirement under section 
        401, 403, 408, or 457 solely by reason of accepting such 
        contribution.
            ``(4) Erroneous credits.--
                    ``(A) In general.--If any contribution is 
                erroneously paid under subsection (a)(2), including a 
                payment that is not made to an applicable retirement 
                savings vehicle, the amount of such erroneous payment 
                shall be treated as an underpayment of tax (other than 
                for purposes of part II of subchapter A of chapter 68) 
                for the taxable year in which the Secretary determines 
                the payment is erroneous.
                    ``(B) Distribution of erroneous credits.--In the 
                case of a contribution to which subparagraph (A) 
                applies--
                            ``(i) section 402(a), 403(a)(1), 403(b)(1), 
                        408(d)(1), or 457(a)(1), whichever is 
                        applicable, shall not apply to any distribution 
                        of such contribution, and section 72(t) shall 
                        not apply to the distribution of such 
                        contribution or any income attributable 
                        thereto, if such distribution is received not 
                        later than the day prescribed by law (including 
                        extensions of time) for filing the individual's 
                        return for such taxable year, and
                            ``(ii) any plan or arrangement from which 
                        such a distribution is made under this 
                        subparagraph shall not be treated as violating 
                        any requirement under section 401, 403, or 457 
                        solely by reason of making such distribution.
            ``(5) Exception from reduction or offset.--Any payment made 
        to any individual under this section shall not be--
                    ``(A) subject to reduction or offset pursuant to 
                subsection (c), (d), (e), or (f) of section 6402 or any 
                similar authority permitting offset, or
                    ``(B) reduced or offset by other assessed Federal 
                taxes that would otherwise be subject to levy or 
                collection.
    ``(g) Provision by Secretary of Information Relating to 
Contributions.--In the case of an amount elected by an eligible 
individual to be contributed to an account or plan under subsection 
(e)(2), the Secretary shall provide general guidance applicable to the 
custodian of the account or the plan sponsor, as the case may be, 
detailing the treatment of such contribution under subsection (f)(2) 
and the reporting requirements with respect to such contribution under 
section 6058, particularly as such requirements are modified pursuant 
to section 102(c)(2) of the Enhancing American Retirement Now Act.
    ``(h) Inflation Adjustments.--
            ``(1) In general.--In the case of any taxable year 
        beginning in a calendar year after 2027, the $41,000 amount in 
        subsection (b)(3)(A)(i) shall be increased by an amount equal 
        to--
                    ``(A) such dollar amount, multiplied by
                    ``(B) 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 2026' for `calendar year 2016' in 
                subparagraph (A)(ii) thereof.
            ``(2) Rounding.--Any increase determined under paragraph 
        (1) shall be rounded to the nearest multiple of $1,000.''.
    (b) Treatment of Certain Possessions.--
            (1) Payments to possessions with mirror code tax systems.--
        The Secretary of the Treasury shall pay to each possession of 
        the United States which has a mirror code tax system amounts 
        equal to the loss (if any) to that possession by reason of the 
        amendments made by this section. Such amounts shall be 
        determined by the Secretary of the Treasury based on 
        information provided by the government of the respective 
        possession.
            (2) Payments to other possessions.--The Secretary of the 
        Treasury shall pay to each possession of the United States 
        which does not have a mirror code tax system amounts estimated 
        by the Secretary of the Treasury as being equal to the 
        aggregate benefits (if any) that would have been provided to 
        residents of such possession by reason of the amendments made 
        by this section if a mirror code tax system had been in effect 
        in such possession. The preceding sentence shall not apply 
        unless the respective possession has a plan, which has been 
        approved by the Secretary of the Treasury, under which such 
        possession will promptly distribute such payments to its 
        residents.
            (3) Coordination with credit allowed against united states 
        income taxes.--No credit shall be allowed against United States 
        income taxes under section 6433 of the Internal Revenue Code of 
        1986 (as added by this section) to any person--
                    (A) to whom a credit is allowed against taxes 
                imposed by the possession by reason of the amendments 
                made by this section, or
                    (B) who is eligible for a payment under a plan 
                described in paragraph (2).
            (4) Mirror code tax system.--For purposes of this 
        subsection, the term ``mirror code tax system'' means, with 
        respect to any possession of the United States, the income tax 
        system of such possession if the income tax liability of the 
        residents of such possession under such system is determined by 
        reference to the income tax laws of the United States as if 
        such possession were the United States.
            (5) Treatment of payments.--For purposes of section 1324 of 
        title 31, United States Code, the payments under this 
        subsection shall be treated in the same manner as a refund due 
        from a credit provision referred to in subsection (b)(2) of 
        such section.
    (c) Administrative Provisions.--
            (1) Deficiencies.--Section 6211(b)(4) is amended by 
        striking ``and 7527A'' and inserting ``7527A, and 6433''.
            (2) Reporting.--The Secretary of the Treasury shall amend 
        the forms relating to reports required under section 6058 of 
        the Internal Revenue Code of 1986 to require--
                    (A) separate reporting of the aggregate amount of 
                contributions received by the plan during the year 
                under section 6433 of the Internal Revenue Code of 1986 
                (as added by this section), and
                    (B) similar reporting with respect to individual 
                retirement accounts (as defined in section 408 of such 
                Code) and individual retirement annuities (as defined 
                in section 408(b) of such Code).
    (d) Payment Authority.--Section 1324(b)(2) of title 31, United 
States Code, is amended by striking ``or 7527A'' and inserting ``7527A, 
or 6433''.
    (e) Conforming Amendments.--
            (1) Paragraph (1) of section 25B(d) is amended by striking 
        ``the sum of--'' and all that follows through ``the amount of 
        contributions made before January 1, 2026'' and inserting ``the 
        amount of contributions made before January 1, 2026''.
            (2) The table of sections for subchapter B of chapter 65 is 
        amended by adding at the end the following new item:

``Sec. 6433. Matching payments for elective deferral and IRA 
                            contributions by certain individuals.''.
    (f) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2026.

SEC. 103. MODIFICATION OF PARTICIPATION REQUIREMENTS FOR LONG-TERM, 
              PART-TIME WORKERS.

    (a) Participation Requirement.--Clause (ii) of section 401(k)(2)(D) 
is amended by striking ``3 consecutive'' and inserting ``2 
consecutive''.
    (b) 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)''.
    (c) 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 matching 
contributions to employees described in section 401(k)(15)(B)(i).''.
    (d) Effective Dates.--
            (1) In general.--The amendment made by subsection (a) shall 
        apply to plan years beginning after December 31, 2022.
            (2) Pre-2021 service and top-heavy rules.--The amendments 
        made by subsections (b) and (c) shall take effect as if 
        included in the enactment of section 112 of the Setting Every 
        Community Up for Retirement Enhancement Act of 2019.

SEC. 104. TREATMENT OF STUDENT LOAN PAYMENTS AS ELECTIVE DEFERRALS FOR 
              PURPOSES OF MATCHING CONTRIBUTIONS.

    (a) In General.--Subparagraph (A) of section 401(m)(4) is amended 
by striking ``and'' at the end of clause (i), by striking the period at 
the end of clause (ii) and inserting ``, and'', and by adding at the 
end the following new clause:
                            ``(iii) subject to the requirements of 
                        paragraph (14), any employer contribution made 
                        to a defined contribution plan on behalf of an 
                        employee on account of a qualified student loan 
                        payment.''.
    (b) Qualified Student Loan Payment.--Paragraph (4) of section 
401(m) is amended by adding at the end the following new subparagraph:
                    ``(D) Qualified student loan payment.--The term 
                `qualified student loan payment' means a payment made 
                by an employee in repayment of a qualified education 
                loan (as defined in section 221(d)(1)) incurred by the 
                employee to pay qualified higher education expenses, 
                but only--
                            ``(i) to the extent such payments in the 
                        aggregate for the year do not exceed an amount 
                        equal to--
                                    ``(I) the limitation applicable 
                                under section 402(g) for the year (or, 
                                if lesser, the employee's compensation 
                                (as defined in section 415(c)(3)) for 
                                the year), reduced by
                                    ``(II) the elective deferrals made 
                                by the employee for such year, and
                            ``(ii) if the employee certifies annually 
                        to the employer making the matching 
                        contribution under this paragraph that such 
                        payment has been made on such loan.
                For purposes of this subparagraph, the term `qualified 
                higher education expenses' means the cost of attendance 
                (as defined in section 472 of the Higher Education Act 
                of 1965, as in effect on the day before the date of the 
                enactment of the Taxpayer Relief Act of 1997) at an 
                eligible educational institution (as defined in section 
                221(d)(2)).''.
    (c) Matching Contributions for Qualified Student Loan Payments.--
Subsection (m) of section 401, as amended by this Act, is further 
amended by redesignating paragraph (14) as paragraph (15), and by 
inserting after paragraph (13) the following new paragraph:
            ``(14) Matching contributions for qualified student loan 
        payments.--
                    ``(A) In general.--For purposes of paragraph 
                (4)(A)(iii), an employer contribution made to a defined 
                contribution plan on account of a qualified student 
                loan payment shall be treated as a matching 
                contribution for purposes of this title if--
                            ``(i) the plan provides matching 
                        contributions on account of elective deferrals 
                        at the same rate as contributions on account of 
                        qualified student loan payments,
                            ``(ii) the plan provides matching 
                        contributions on account of qualified student 
                        loan payments only on behalf of employees 
                        otherwise eligible to receive matching 
                        contributions on account of elective deferrals,
                            ``(iii) under the plan, all employees 
                        eligible to receive matching contributions on 
                        account of elective deferrals are eligible to 
                        receive matching contributions on account of 
                        qualified student loan payments, and
                            ``(iv) the plan provides that matching 
                        contributions on account of qualified student 
                        loan payments vest in the same manner as 
                        matching contributions on account of elective 
                        deferrals.
                    ``(B) Treatment for purposes of nondiscrimination 
                rules, etc.--
                            ``(i) Nondiscrimination rules.--For 
                        purposes of subparagraph (A)(iii), subsection 
                        (a)(4), and section 410(b), matching 
                        contributions described in paragraph 
                        (4)(A)(iii) shall not fail to be treated as 
                        available to an employee solely because such 
                        employee does not have debt incurred under a 
                        qualified education loan (as defined in section 
                        221(d)(1)).
                            ``(ii) Student loan payments not treated as 
                        plan contribution.--Except as provided in 
                        clause (iii), a qualified student loan payment 
                        shall not be treated as a contribution to a 
                        plan under this title.
                            ``(iii) Matching contribution rules.--
                        Solely for purposes of meeting the requirements 
                        of paragraph (11)(B), (12), or (13) of this 
                        subsection, or paragraph (11)(B)(i)(II), 
                        (12)(B), (13)(D), or (16)(D) of subsection (k), 
                        a plan may treat a qualified student loan 
                        payment as an elective deferral or an elective 
                        contribution, whichever is applicable.
                            ``(iv) Actual deferral percentage 
                        testing.--In determining whether a plan meets 
                        the requirements of subsection (k)(3)(A)(ii) 
                        for a plan year, the plan may apply the 
                        requirements of such subsection separately with 
                        respect to all employees who receive matching 
                        contributions described in paragraph 
                        (4)(A)(iii) for the plan year.
                    ``(C) Employer may rely on employee 
                certification.--The employer may rely on an employee 
                certification of payment under paragraph (4)(D)(ii).''.
    (d) Simple Retirement Accounts.--Paragraph (2) of section 408(p) is 
amended by adding at the end the following new subparagraph:
                    ``(F) Matching contributions for qualified student 
                loan payments.--
                            ``(i) In general.--Subject to the rules of 
                        clause (iii), an arrangement shall not fail to 
                        be treated as meeting the requirements of 
                        subparagraph (A)(iii) solely because under the 
                        arrangement, solely for purposes of such 
                        subparagraph, qualified student loan payments 
                        are treated as amounts elected by the employee 
                        under subparagraph (A)(i)(I) to the extent such 
                        payments do not exceed--
                                    ``(I) the applicable dollar amount 
                                under subparagraph (E) (after 
                                application of section 414(v)) for the 
                                year (or, if lesser, the employee's 
                                compensation (as defined in section 
                                415(c)(3)) for the year), reduced by
                                    ``(II) any other amounts elected by 
                                the employee under subparagraph 
                                (A)(i)(I) for the year.
                            ``(ii) Qualified student loan payment.--For 
                        purposes of this subparagraph--
                                    ``(I) In general.--The term 
                                `qualified student loan payment' means 
                                a payment made by an employee in 
                                repayment of a qualified education loan 
                                (as defined in section 221(d)(1)) 
                                incurred by the employee to pay 
                                qualified higher education expenses, 
                                but only if the employee certifies to 
                                the employer making the matching 
                                contribution that such payment has been 
                                made on such a loan.
                                    ``(II) Qualified higher education 
                                expenses.--The term `qualified higher 
                                education expenses' has the same 
                                meaning as when used in section 
                                401(m)(4)(D).
                            ``(iii) Applicable rules.--Clause (i) shall 
                        apply to an arrangement only if, under the 
                        arrangement--
                                    ``(I) matching contributions on 
                                account of qualified student loan 
                                payments are provided only on behalf of 
                                employees otherwise eligible to elect 
                                contributions under subparagraph 
                                (A)(i)(I), and
                                    ``(II) all employees otherwise 
                                eligible to participate in the 
                                arrangement are eligible to receive 
                                matching contributions on account of 
                                qualified student loan payments.''.
    (e) 403(b) Plans.--Subparagraph (A) of section 403(b)(12) is 
amended by adding at the end the following: ``The fact that the 
employer offers matching contributions on account of qualified student 
loan payments as described in section 401(m)(14) shall not be taken 
into account in determining whether the arrangement satisfies the 
requirements of clause (ii) (and any regulation thereunder).''.
    (f) 457(b) Plans.--Subsection (b) of section 457 is amended by 
adding at the end the following: ``A plan which is established and 
maintained by an employer which is described in subsection (e)(1)(A) 
shall not be treated as failing to meet the requirements of this 
subsection solely because the plan, or another plan maintained by the 
employer which meets the requirements of section 401(a) or 403(b), 
provides for matching contributions on account of qualified student 
loan payments as described in section 401(m)(14).''.
    (g) Regulatory Authority.--The Secretary of the Treasury (or such 
Secretary's delegate) shall prescribe regulations for purposes of 
implementing the amendments made by this section, including 
regulations--
            (1) permitting a plan to make matching contributions for 
        qualified student loan payments, as defined in sections 
        401(m)(4)(D) and 408(p)(2)(F) of the Internal Revenue Code of 
        1986, as added by this section, at a different frequency than 
        matching contributions are otherwise made under the plan, 
        provided that the frequency is not less than annually;
            (2) permitting employers to establish reasonable procedures 
        to claim matching contributions for such qualified student loan 
        payments under the plan, including an annual deadline (not 
        earlier than 3 months after the close of each plan year) by 
        which a claim must be made; and
            (3) promulgating model amendments which plans may adopt to 
        implement matching contributions on such qualified student loan 
        payments for purposes of sections 401(m), 408(p), 403(b), and 
        457(b) of the Internal Revenue Code of 1986.
    (h) Effective Date.--The amendments made by this section shall 
apply to contributions made for plan years beginning after December 31, 
2023.

SEC. 105. WITHDRAWALS FOR CERTAIN EMERGENCY EXPENSES.

    (a) In General.--Paragraph (2) of section 72(t) is amended by 
adding at the end the following new subparagraph:
                    ``(I) Distributions for certain emergency 
                expenses.--
                            ``(i) In general.--Any emergency personal 
                        expense distribution.
                            ``(ii) Annual limitation.--Not more than 1 
                        distribution per calendar year may be treated 
                        as an emergency personal expense distribution 
                        by any individual.
                            ``(iii) Dollar limitation.--The amount 
                        which may be treated as an emergency personal 
                        expense distribution by any individual in any 
                        calendar year shall not exceed the lesser of 
                        $1,000 or an amount equal to the excess of--
                                    ``(I) the individual's total 
                                nonforfeitable accrued benefit under 
                                the plan (the individual's total 
                                interest in the plan in the case of an 
                                individual retirement plan), determined 
                                as of the date of each such 
                                distribution, over
                                    ``(II) $1,000.
                            ``(iv) Emergency personal expense 
                        distribution.--For purposes of this 
                        subparagraph, the term `emergency personal 
                        expense distribution' means any distribution 
                        from an applicable eligible retirement plan (as 
                        defined in subparagraph (H)(vi)(I)) to an 
                        individual for purposes of meeting 
                        unforeseeable or immediate financial needs 
                        relating to necessary personal or family 
                        emergency expenses. The administrator of an 
                        applicable eligible retirement plan may rely on 
                        an employee's certification that the employee 
                        satisfies the conditions of the preceding 
                        sentence in determining whether any 
                        distribution is an emergency personal expense 
                        distribution. The Secretary may provide by 
                        regulations for exceptions to the rule of the 
                        preceding sentence in cases where the plan 
                        administrator has actual knowledge to the 
                        contrary of the employee's certification, and 
                        for procedures for addressing cases of employee 
                        misrepresentation.
                            ``(v) Treatment of plan distributions.--If 
                        a distribution to an individual would (without 
                        regard to clause (ii) or (iii)) be an emergency 
                        personal expense distribution, a plan shall not 
                        be treated as failing to meet any requirement 
                        of this title merely because the plan treats 
                        the distribution as an emergency personal 
                        expense distribution, unless the number or the 
                        aggregate amount of such distributions from all 
                        plans maintained by the employer (and any 
                        member of any controlled group which includes 
                        the employer, determined as provided in 
                        subparagraph (H)(iv)(II)) to such individual 
                        exceeds the limitation determined under clause 
                        (ii) or (iii).
                            ``(vi) Amount distributed may be repaid.--
                                    ``(I) In general.--Any individual 
                                who receives an emergency personal 
                                expense distribution may, at any time 
                                during the 3-year period beginning on 
                                the day after the date on which such 
                                distribution was received, make one or 
                                more contributions in an aggregate 
                                amount not to exceed the amount of such 
                                distribution to an applicable eligible 
                                retirement plan of which such 
                                individual is a beneficiary and to 
                                which a rollover contribution of such 
                                distribution could be made under 
                                section 402(c), 403(a)(4), 403(b)(8), 
                                408(d)(3), or 457(e)(16), as the case 
                                may be.
                                    ``(II) Limitation on contributions 
                                to applicable eligible retirement plans 
                                other than iras.--The aggregate amount 
                                of contributions made by an individual 
                                under subclause (I) to any applicable 
                                eligible retirement plan which is not 
                                an individual retirement plan shall not 
                                exceed the aggregate amount of 
                                emergency personal expense 
                                distributions which are made from such 
                                plan to such individual. Subclause (I) 
                                shall not apply to contributions to any 
                                applicable eligible retirement plan 
                                which is not an individual retirement 
                                plan unless the individual is eligible 
                                to make contributions (other than those 
                                described in subclause (I)) to such 
                                applicable eligible retirement plan.
                                    ``(III) Treatment of repayments of 
                                distributions from applicable eligible 
                                retirement plans other than iras.--If a 
                                contribution is made under subclause 
                                (I) with respect to an emergency 
                                personal expense distribution from an 
                                applicable eligible retirement plan 
                                other than an individual retirement 
                                plan, then the taxpayer shall, to the 
                                extent of the amount of the 
                                contribution, be treated as having 
                                received such distribution in an 
                                eligible rollover distribution (as 
                                defined in section 402(c)(4)) and as 
                                having transferred the amount to the 
                                applicable eligible retirement plan in 
                                a direct trustee to trustee transfer 
                                within 60 days of the distribution.
                                    ``(IV) Treatment of repayments for 
                                distributions from iras.--If a 
                                contribution is made under subclause 
                                (I) with respect to an emergency 
                                personal expense distribution from an 
                                individual retirement plan, then, to 
                                the extent of the amount of the 
                                contribution, such distribution shall 
                                be treated as a distribution described 
                                in section 408(d)(3) and as having been 
                                transferred to the applicable eligible 
                                retirement plan in a direct trustee to 
                                trustee transfer within 60 days of the 
                                distribution.
                            ``(vii) Limitation on subsequent 
                        distributions.--If a distribution is treated as 
                        an emergency personal expense distribution in 
                        any calendar year with respect to a plan of the 
                        employee, no amount may be treated as such a 
                        distribution during the immediately following 3 
                        calendar years with respect to such plan 
                        unless--
                                    ``(I) such previous distribution is 
                                fully repaid to such plan pursuant to 
                                clause (vi), or
                                    ``(II) the aggregate of the 
                                elective deferrals and employee 
                                contributions to the plan (the total 
                                amounts contributed to the plan in the 
                                case of an individual retirement plan) 
                                subsequent to such previous 
                                distribution is at least equal to the 
                                amount of such previous distribution 
                                which has not been so repaid.
                            ``(viii) Special rules.--Rules similar to 
                        the rules of subclauses (II) and (IV) of 
                        subparagraph (H)(vi) shall apply to any 
                        emergency personal expense distribution.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to distributions made after December 31, 2023.

SEC. 106. ALLOW ADDITIONAL NONELECTIVE CONTRIBUTIONS TO SIMPLE PLANS.

    (a) In General.--
            (1) Modification to definition.--Subparagraph (A) of 
        section 408(p)(2) is amended by striking ``and'' at the end of 
        clause (iii), by redesignating clause (iv) as clause (v), and 
        by inserting after clause (iii) the following new clause:
                            ``(iv) the employer may make nonelective 
                        contributions--
                                    ``(I) of a uniform percentage (up 
                                to 10 percent) of compensation, and
                                    ``(II) not to exceed $5,000,
                        for each employee who is eligible to 
                        participate in the arrangement and who has at 
                        least $5,000 of compensation from the employer 
                        for the year, and''.
            (2) Limitation.--Subparagraph (A) of section 408(p)(2) is 
        amended by adding at the end the following: ``The compensation 
        taken into account under clause (iv) for any year shall not 
        exceed the limitation in effect for such year under section 
        401(a)(17).''.
            (3) Overall dollar limit on contributions.--Paragraph (8) 
        of section 408(p) is amended to read as follows:
            ``(8) Coordination with maximum limitation.--In the case of 
        any simple retirement account--
                    ``(A) subsection (a)(1) shall be applied by 
                substituting for `the amount in effect for such taxable 
                year under section 219(b)(1)(A)' the following: `the 
                sum of the dollar amount in effect under subsection 
                (p)(2)(A)(ii), the employer contribution required under 
                subsection (p)(2)(A)(iii) or (p)(2)(B)(i), whichever is 
                applicable, and a contribution which meets the 
                requirement of subsection (p)(2)(A)(iv) with respect to 
                the employee', and
                    ``(B) subsection (b)(2)(B) shall be applied by 
                substituting for `the dollar amount in effect under 
                section 219(b)(1)(A)' the following: `the sum of the 
                dollar amount in effect under subsection (p)(2)(A)(ii), 
                the employer contribution required under subsection 
                (p)(2)(A)(iii) or (p)(2)(B)(i), whichever is 
                applicable, and a contribution which meets the 
                requirement of subsection (p)(2)(A)(iv) with respect to 
                the employee'.''.
            (4) Adjustment for inflation.--Paragraph (2) of section 
        408(p), as amended by this Act, is further amended by adding at 
        the end the following new subparagraph:
                    ``(G) Adjustment for inflation.--In the case of 
                taxable years beginning after December 31, 2024, the 
                $5,000 amount in subparagraph (A)(iv)(II) shall be 
                increased by an amount equal to--
                            ``(i) such amount, multiplied 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 `2023' for `2016' in 
                        subparagraph (A)(ii) thereof.
                If any amount as adjusted under the preceding sentence 
                is not a multiple of $100, such amount shall be rounded 
                to the nearest multiple of $100.''.
    (b) Conforming Amendments.--
            (1) Section 408(p)(2)(A)(v), as redesignated by subsection 
        (a), is amended by striking ``or (iii)'' and inserting ``, 
        (iii), or (iv)''.
            (2) Section 401(k)(11)(B)(i) is amended by striking ``and'' 
        at the end of subclause (II), by redesignating subclause (III) 
        as subclause (IV), and by inserting after subclause (II) the 
        following new subclause:
                                    ``(III) the employer may make 
                                nonelective contributions of a uniform 
                                percentage (up to 10 percent) of 
                                compensation, not to exceed the amount 
                                in effect under section 
                                408(p)(2)(A)(iv)(II) in any year, for 
                                each employee who is eligible to 
                                participate in the arrangement and who 
                                has at least $5,000 of compensation 
                                from the employer for the year, and''.
            (3) Section 401(k)(11)(B)(i)(IV), as redesignated by 
        paragraph (2), is amended by striking ``or (II)'' and inserting 
        ``, (II), or (III)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2023.

SEC. 107. SMALL IMMEDIATE FINANCIAL INCENTIVES FOR CONTRIBUTING TO A 
              PLAN.

    (a) In General.--Subparagraph (A) of section 401(k)(4) is amended 
by inserting ``(other than a de minimis financial incentive provided to 
employees who elect to have the employer make contributions under the 
arrangement in lieu of receiving cash)'' after ``any other benefit''.
    (b) Section 403(b) Plans.--Subparagraph (A) of section 403(b)(12), 
as amended by this Act, is further amended by adding at the end the 
following: ``A plan shall not fail to satisfy clause (ii) solely by 
reason of offering a de minimis financial incentive for employees who 
elect to have the employer make contributions pursuant to a salary 
reduction agreement.''.
    (c) Exemption From Prohibited Transaction Rules.--Subsection (d) of 
section 4975 is amended by striking ``or'' at the end of paragraph 
(22)(I), by striking the period at the end of paragraph (23) and 
inserting ``, or'', and by adding at the end the following new 
paragraph:
            ``(24) the provision of a de minimis financial incentive 
        described in section 401(k)(4)(A) or 403(b)(12)(A).''.
    (d) Effective Date.--The amendments made by this section shall 
apply with respect to plan years beginning after the date of the 
enactment of this Act.

SEC. 108. INDEXING IRA CATCH-UP LIMIT.

    (a) In General.--Subparagraph (C) of section 219(b)(5) is amended 
by adding at the end the following new clause:
                            ``(iii) Indexing of catch-up limitation.--
                        In the case of any taxable year beginning in a 
                        calendar year after 2022, the $1,000 amount 
                        under subparagraph (B)(ii) shall be increased 
                        by an amount equal to--
                                    ``(I) such dollar amount, 
                                multiplied 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 2021' for 
                                `calendar year 2016' in subparagraph 
                                (A)(ii) thereof.
                        If any amount after adjustment under the 
                        preceding sentence is not a multiple of $100, 
                        such amount shall be rounded to the next lower 
                        multiple of $100.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 109. HIGHER CATCH-UP LIMIT TO APPLY AT AGE 60, 61, 62, AND 63.

    (a) In General.--
            (1) Plans other than simple plans.--Section 414(v)(2)(B)(i) 
        is amended by inserting the following before the period: 
        ``($10,000, in the case of an eligible participant who would 
        attain age 60 but would not attain age 64 before the close of 
        the taxable year)''.
            (2) Simple plans.--Section 414(v)(2)(B)(ii) is amended by 
        inserting the following before the period: ``($5,000, in the 
        case of an eligible participant who would attain age 60 but 
        would not attain age 64 before the close of the taxable 
        year)''.
    (b) Cost-of-living Adjustments.--Subparagraph (C) of section 
414(v)(2) is amended by adding at the end the following: ``In the case 
of a year beginning after December 31, 2025, the Secretary shall adjust 
annually the $10,000 amount in subparagraph (B)(i) and the $5,000 
amount in subparagraph (B)(ii) for increases in the cost-of-living at 
the same time and in the same manner as adjustments under the preceding 
sentence; except that the base period taken into account shall be the 
calendar quarter beginning July 1, 2024.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2024.

SEC. 110. ELIMINATE THE ``FIRST DAY OF THE MONTH'' REQUIREMENT 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 described 
                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 providing for such 
                deferral has been entered into before 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. 111. TAX TREATMENT OF CERTAIN NONTRADE OR BUSINESS SEP 
              CONTRIBUTIONS.

    (a) In General.--Subparagraph (B) of section 4972(c)(6) is 
amended--
            (1) by striking ``408(p)) or'' and inserting ``408(p)),''; 
        and
            (2) by inserting ``, or a simplified employee pension 
        (within the meaning of section 408(k))'' after ``401(k)(11))''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 112. ELIMINATION OF ADDITIONAL TAX ON CORRECTIVE DISTRIBUTIONS OF 
              EXCESS CONTRIBUTIONS.

    (a) In General.--Subparagraph (A) of section 72(t)(2) is amended--
            (1) by striking ``or'' at the end of clause (vii);
            (2) by striking the period at the end of clause (viii) and 
        inserting ``, or''; and
            (3) by inserting after clause (viii) the following new 
        clause:
                            ``(ix) attributable to withdrawal of net 
                        income attributable to a contribution which is 
                        distributed pursuant to section 408(d)(4).''.
    (b) Effective Date.--The amendments made by this section shall 
apply to any determination of, or affecting, liability for taxes, 
interest, or penalties which is made on or after the date of the 
enactment of this Act, without regard to whether the act (or failure to 
act) upon which the determination is based occurred before such date of 
enactment. Notwithstanding the preceding sentence, nothing in the 
amendments made by this section shall be construed to create an 
inference with respect to the law in effect prior to the effective date 
of such amendments.

SEC. 113. EMPLOYER MAY RELY ON EMPLOYEE CERTIFYING THAT DEEMED HARDSHIP 
              DISTRIBUTION CONDITIONS ARE MET.

    (a) Cash or Deferred Arrangements.--Section 401(k)(14) is amended 
by adding at the end the following new subparagraph:
                    ``(C) Employee certification.--In determining 
                whether a distribution is upon the hardship of an 
                employee, the administrator of the plan may rely on a 
                written certification by the employee that the 
                distribution is--
                            ``(i) on account of a financial need of a 
                        type which is deemed in regulations prescribed 
                        by the Secretary to be an immediate and heavy 
                        financial need, and
                            ``(ii) not in excess of the amount required 
                        to satisfy such financial need, and
                that the employee has no alternative means reasonably 
                available to satisfy such financial need. The Secretary 
                may provide by regulations for exceptions to the rule 
                of the preceding sentence in cases where the plan 
                administrator has actual knowledge to the contrary of 
                the employee's certification, and for procedures for 
                addressing cases of employee misrepresentation.''.
    (b) 403(b) Plans.--
            (1) Custodial accounts.--Section 403(b)(7) is amended by 
        adding at the end the following new subparagraph:
                    ``(D) Employee certification.--In determining 
                whether a distribution is upon the financial hardship 
                of an employee, the administrator of the plan may rely 
                on a written certification by the employee that the 
                distribution is--
                            ``(i) on account of a financial need of a 
                        type which is deemed in regulations prescribed 
                        by the Secretary to be an immediate and heavy 
                        financial need, and
                            ``(ii) not in excess of the amount required 
                        to satisfy such financial need, and
                that the employee has no alternative means reasonably 
                available to satisfy such financial need. The Secretary 
                may provide by regulations for exceptions to the rule 
                of the preceding sentence in cases where the plan 
                administrator has actual knowledge to the contrary of 
                the employee's certification, and for procedures for 
                addressing cases of employee misrepresentation.''.
            (2) Annuity contracts.--Section 403(b)(11) is amended by 
        adding at the end the following: ``In determining whether a 
        distribution is upon hardship of an employee, the administrator 
        of the plan may rely on a written certification by the employee 
        that the distribution is on account of a financial need of a 
        type which is deemed in regulations prescribed by the Secretary 
        to be an immediate and heavy financial need and is not in 
        excess of the amount required to satisfy such financial need, 
        and that the employee has no alternative means reasonably 
        available to satisfy such financial need. The Secretary may 
        provide by regulations for exceptions to the rule of the 
        preceding sentence in cases where the plan administrator has 
        actual knowledge to the contrary of the employee's 
        certification, and for procedures for addressing cases of 
        employee misrepresentation.''.
    (c) 457(b) Plan.--Section 457(d) is amended by adding at the end 
the following new paragraph:
            ``(4) Participant certification.--In determining whether a 
        distribution to a participant is made when the participant is 
        faced with an unforeseeable emergency, the administrator of a 
        plan maintained by an eligible employer described in subsection 
        (e)(1)(A) may rely on a written certification by the 
        participant that the distribution is--
                    ``(A) made when the participant is faced with an 
                unforeseeable emergency of a type which is described in 
                regulations prescribed by the Secretary as an 
                unforeseeable emergency, and
                    ``(B) not in excess of the amount required to 
                satisfy the emergency need, and
        that the participant has no alternative means reasonably 
        available to satisfy such emergency need. The Secretary may 
        provide by regulations for exceptions to the rule of the 
        preceding sentence in cases where the plan administrator has 
        actual knowledge to the contrary of the participant's 
        certification, and for procedures for addressing cases of 
        participant misrepresentation.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after the date of the enactment of this 
Act.

SEC. 114. PENALTY-FREE WITHDRAWALS FROM RETIREMENT PLANS FOR 
              INDIVIDUALS IN CASE OF DOMESTIC ABUSE.

    (a) In General.--Paragraph (2) of section 72(t), as amended by this 
Act, is further amended by adding at the end the following new 
subparagraph:
                    ``(J) Distributions from retirement plan in case of 
                domestic abuse.--
                            ``(i) In general.--Any eligible 
                        distribution to a domestic abuse victim.
                            ``(ii) Limitation.--The aggregate amount 
                        which may be treated as an eligible 
                        distribution to a domestic abuse victim by any 
                        individual shall not exceed an amount equal to 
                        the lesser of--
                                    ``(I) $10,000, or
                                    ``(II) 50 percent of the present 
                                value of the nonforfeitable accrued 
                                benefit of the employee under the plan.
                            ``(iii) Eligible distribution to a domestic 
                        abuse victim.--For purposes of this 
                        subparagraph--
                                    ``(I) In general.--A distribution 
                                shall be treated as an eligible 
                                distribution to a domestic abuse victim 
                                if such distribution is from an 
                                applicable eligible retirement plan and 
                                is made to an individual during the 1-
                                year period beginning on any date on 
                                which the individual is a victim of 
                                domestic abuse by a spouse or domestic 
                                partner.
                                    ``(II) Domestic abuse.--The term 
                                `domestic abuse' means physical, 
                                psychological, sexual, emotional, or 
                                economic abuse, including efforts to 
                                control, isolate, humiliate, or 
                                intimidate the victim, or to undermine 
                                the victim's ability to reason 
                                independently, including by means of 
                                abuse of the victim's child or another 
                                family member living in the household.
                            ``(iv) Treatment of plan distributions.--If 
                        a distribution to an individual would (without 
                        regard to clause (ii)) be an eligible 
                        distribution to a domestic abuse victim, a plan 
                        shall not be treated as failing to meet any 
                        requirement of this title merely because the 
                        plan treats the distribution as an eligible 
                        distribution to a domestic abuse victim, unless 
                        the aggregate amount of such distributions from 
                        all plans maintained by the employer (and any 
                        member of any controlled group which includes 
                        the employer, determined as provided in 
                        subparagraph (H)(iv)(II)) to such individual 
                        exceeds the limitation under clause (ii).
                            ``(v) Amount distributed may be repaid.--
                                    ``(I) In general.--Any individual 
                                who receives a distribution described 
                                in clause (i) may, at any time during 
                                the 3-year period beginning on the day 
                                after the date on which such 
                                distribution was received, make one or 
                                more contributions in an aggregate 
                                amount not to exceed the amount of such 
                                distribution to an applicable eligible 
                                retirement plan of which such 
                                individual is a beneficiary and to 
                                which a rollover contribution of such 
                                distribution could be made under 
                                section 402(c), 403(a)(4), 403(b)(8), 
                                408(d)(3), or 457(e)(16), as the case 
                                may be.
                                    ``(II) Limitation on contributions 
                                to applicable eligible retirement plans 
                                other than IRAs.--The aggregate amount 
                                of contributions made by an individual 
                                under subclause (I) to any applicable 
                                eligible retirement plan which is not 
                                an individual retirement plan shall not 
                                exceed the aggregate amount of eligible 
                                distributions to a domestic abuse 
                                victim which are made from such plan to 
                                such individual. Subclause (I) shall 
                                not apply to contributions to any 
                                applicable eligible retirement plan 
                                which is not an individual retirement 
                                plan unless the individual is eligible 
                                to make contributions (other than those 
                                described in subclause (I)) to such 
                                applicable eligible retirement plan.
                                    ``(III) Treatment of repayments of 
                                distributions from applicable eligible 
                                retirement plans other than iras.--If a 
                                contribution is made under subclause 
                                (I) with respect to an eligible 
                                distribution to a domestic abuse victim 
                                from an applicable eligible retirement 
                                plan other than an individual 
                                retirement plan, then the taxpayer 
                                shall, to the extent of the amount of 
                                the contribution, be treated as having 
                                received such distribution in an 
                                eligible rollover distribution (as 
                                defined in section 402(c)(4)) and as 
                                having transferred the amount to the 
                                applicable eligible retirement plan in 
                                a direct trustee to trustee transfer 
                                within 60 days of the distribution.
                                    ``(IV) Treatment of repayments for 
                                distributions from iras.--If a 
                                contribution is made under subclause 
                                (I) with respect to an eligible 
                                distribution to a domestic abuse victim 
                                from an individual retirement plan, 
                                then, to the extent of the amount of 
                                the contribution, such distribution 
                                shall be treated as a distribution 
                                described in section 408(d)(3) and as 
                                having been transferred to the 
                                applicable eligible retirement plan in 
                                a direct trustee to trustee transfer 
                                within 60 days of the distribution.
                            ``(vi) Definition and special rules.--For 
                        purposes of this subparagraph:
                                    ``(I) Applicable eligible 
                                retirement plan.--The term `applicable 
                                eligible retirement plan' means an 
                                eligible retirement plan (as defined in 
                                section 402(c)(8)(B)) other than a 
                                defined benefit plan or a plan to which 
                                sections 401(a)(11) and 417 apply.
                                    ``(II) Exemption of distributions 
                                from trustee to trustee transfer and 
                                withholding rules.--For purposes of 
                                sections 401(a)(31), 402(f), and 3405, 
                                an eligible distribution to a domestic 
                                abuse victim shall not be treated as an 
                                eligible rollover distribution.
                                    ``(III) Distributions treated as 
                                meeting plan distribution requirements; 
                                self-certification.--Any distribution 
                                which the employee or participant 
                                certifies as being an eligible 
                                distribution to a domestic abuse victim 
                                shall be treated as meeting the 
                                requirements of sections 
                                401(k)(2)(B)(i), 403(b)(7)(A)(i), 
                                403(b)(11), and 457(d)(1)(A).''.
    (b) Effective Date.--The amendments made by this section shall 
apply to distributions made after the date of the enactment of this 
Act.

SEC. 115. AMENDMENTS TO INCREASE BENEFIT ACCRUALS UNDER PLAN FOR 
              PREVIOUS PLAN YEAR ALLOWED UNTIL EMPLOYER TAX RETURN DUE 
              DATE.

    (a) In General.--Section 401(b) is amended by adding at the end the 
following new paragraph:
            ``(3) Retroactive plan amendments that increase benefit 
        accruals.--If--
                    ``(A) an employer amends a stock bonus, pension, 
                profit-sharing, or annuity plan to increase benefits 
                accrued under the plan effective as of any date during 
                the immediately preceding plan year (other than 
                increasing the amount of matching contributions (as 
                defined in subsection (m)(4)(A))),
                    ``(B) such amendment would not otherwise cause the 
                plan to fail to meet any of the requirements of this 
                subchapter, and
                    ``(C) such amendment is adopted before the time 
                prescribed by law for filing the return of the employer 
                for the taxable year (including extensions thereof) 
                which includes the date described in subparagraph (A),
        the employer may elect to treat such amendment as having been 
        adopted as of the last day of the plan year in which the 
        amendment is effective.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after the date of the enactment of this 
Act.

SEC. 116. RETROACTIVE FIRST YEAR ELECTIVE DEFERRALS FOR SOLE 
              PROPRIETORS.

    (a) In General.--Section 401(b)(2) is amended by adding at the end 
the following: ``In the case of an individual who owns the entire 
interest in an unincorporated trade or business, and who is the only 
employee of such trade or business, any elective deferrals (as defined 
in section 402(g)(3)) under a qualified cash or deferred arrangement to 
which the preceding sentence applies, which are made by such individual 
before the time for filing the return of such individual for the 
taxable year (determined without regard to any extensions) ending after 
or with the end of the plan's first plan year, shall be treated as 
having been made before the end of such first plan year.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to plan years beginning after the date of the enactment of this Act.

SEC. 117. TREASURY GUIDANCE ON ROLLOVERS.

    Not later than January 1, 2025, the Secretary of the Treasury or 
the Secretary's delegate shall, to simplify, standardize, and 
facilitate the completion of direct rollovers from retirement plans and 
trustee-to-trustee transfers from individual retirement plans (as 
defined in section 7701(a)(37) of the Internal Revenue Code of 1986), 
develop and release--
            (1) sample forms for direct rollovers of eligible rollover 
        distributions from a retirement plan to another retirement plan 
        or to an individual retirement plan which--
                    (A) are written in a manner calculated to be 
                understood by the average person, and
                    (B) can be used by both distributing retirement 
                plans and receiving retirement plans and individual 
                retirement plans, and
            (2) sample forms for trustee-to-trustee transfers of 
        amounts from an individual retirement plan to another 
        individual retirement plan or to a retirement plan which--
                    (A) are written in a manner calculated to be 
                understood by the average person, and
                    (B) can be used by both transferring individual 
                retirement plans and receiving retirement plans and 
                individual retirement plans.

SEC. 118. EXEMPTION FOR AUTOMATIC PORTABILITY TRANSACTIONS.

    (a) In General.--Section 4975(d), as amended by this Act, is 
further amended--
            (1) by striking ``or'' at the end of paragraph (23),
            (2) by striking the period at the end of paragraph (24) and 
        inserting ``, or'', and
            (3) by adding at the end the following new paragraph:
            ``(25) the receipt of fees and compensation by the 
        automatic portability provider in connection with an automatic 
        portability transaction.''.
    (b) Definitions.--Section 4975(f) is amended by adding at the end 
the following new paragraph:
            ``(12) Rules relating to automatic portability 
        transactions.--
                    ``(A) In general.--For purposes of subsection 
                (d)(25)--
                            ``(i) Automatic portability transaction.--
                        An automatic portability transaction is a 
                        transfer of assets made--
                                    ``(I) from an individual retirement 
                                plan which is established on behalf of 
                                an individual and to which amounts were 
                                transferred under section 
                                401(a)(31)(B)(i),
                                    ``(II) to an employer-sponsored 
                                retirement plan described in clause 
                                (iii), (iv), (v), or (vi) of section 
                                402(c)(8)(B) (other than a defined 
                                benefit plan) in which such individual 
                                is an active participant, and
                                    ``(III) after such individual has 
                                been given advance notice of the 
                                transfer and has not affirmatively 
                                opted out of such transfer.
                            ``(ii) Automatic portability provider.--An 
                        automatic portability provider is a person that 
                        executes transfers described in clause (i).
                    ``(B) Conditions for automatic portability 
                transactions.--Subsection (d)(25) shall not apply to an 
                automatic portability transaction unless the following 
                requirements are satisfied:
                            ``(i) Acknowledgment of fiduciary status.--
                        An automatic portability provider shall 
                        acknowledge in writing, at such time and format 
                        as specified by the Secretary, that the 
                        provider is a fiduciary with respect to the 
                        individual retirement plan described in 
                        subparagraph (A)(i)(I).
                            ``(ii) Fees.--The fees and compensation 
                        received by the automatic portability provider 
                        in connection with the automatic portability 
                        transaction (including any increase in such 
                        fees or compensation) shall not exceed 
                        reasonable compensation and must be fully 
                        disclosed to and approved in writing in advance 
                        of the transaction by a plan fiduciary of the 
                        plan described in subparagraph (A)(i)(II) which 
                        is independent of the automatic portability 
                        provider.
                            ``(iii) Data usage.--The automatic 
                        portability provider shall not--
                                    ``(I) market or sell data relating 
                                to the individual retirement plan 
                                described in subparagraph (A)(i)(I), or
                                    ``(II) use such data for any 
                                purpose other than the administration 
                                of automatic portability transactions 
                                without the express consent of a plan 
                                fiduciary which is independent of the 
                                automatic portability provider after 
                                full disclosure by such provider of how 
                                such data will be used.
                            ``(iv) Open participation.--The automatic 
                        portability provider shall offer automatic 
                        portability transactions on the same terms to 
                        any plan described in subparagraph (A)(i)(II) 
                        regardless of whether the provider provides 
                        other services for such plan.
                            ``(v) Pre-transaction notice.--At least 30 
                        days in advance of an automatic portability 
                        transaction, the automatic portability provider 
                        shall provide notice to the individual on whose 
                        behalf the individual retirement plan described 
                        in subparagraph (A)(i)(I) is established which 
                        includes--
                                    ``(I) a description of the 
                                automatic portability transaction and 
                                the fees which will be charged in 
                                connection with the transaction,
                                    ``(II) a description of the 
                                individual's right to affirmatively 
                                elect not to participate in the 
                                transaction, the procedures for such an 
                                election, and a telephone number at 
                                which the individual can contact the 
                                automatic portability provider, and
                                    ``(III) such other disclosures as 
                                the Secretary may require by 
                                regulation.
                            ``(vi) Post-transaction notice.--Not later 
                        than 3 business days after an automatic 
                        portability transaction, the automatic 
                        portability provider shall provide notice to 
                        the individual on whose behalf the individual 
                        retirement plan described in subparagraph 
                        (A)(i)(I) is established of--
                                    ``(I) the actions taken by the 
                                automatic portability provider with 
                                respect to the individual's account,
                                    ``(II) all relevant information 
                                regarding the location and amount of 
                                any transferred assets,
                                    ``(III) a statement of fees charged 
                                against the account by the automatic 
                                portability provider or its affiliates 
                                in connection with the transfer,
                                    ``(IV) a telephone number at which 
                                the individual can contact the 
                                automatic portability provider, and
                                    ``(V) such other disclosures as the 
                                Secretary may require by regulation.
                            ``(vii) Notice requirements.--The notices 
                        required under clauses (v) and (vi) shall be 
                        written in a manner calculated to be understood 
                        by the average intended recipient and shall not 
                        include materially misleading statements.
                            ``(viii) Timeliness of execution.--After 
                        liquidating the assets of an individual 
                        retirement plan described in subparagraph 
                        (A)(i)(I) to cash, an automatic portability 
                        provider shall transfer the account balance of 
                        such plan as soon as practicable to the plan 
                        described in subparagraph (A)(i)(II).
                            ``(ix) Record retention and audits.--
                                    ``(I) In general.--An automatic 
                                portability provider shall, for 6 
                                years, maintain the records sufficient 
                                to demonstrate the terms of this 
                                subparagraph have been met.
                                    ``(II) Audits.--An automatic 
                                portability provider shall conduct an 
                                annual audit, in accordance with 
                                regulations promulgated by the 
                                Secretary, of automatic portability 
                                transactions occurring during the 
                                calendar year to demonstrate compliance 
                                with this subparagraph, and shall 
                                submit such audit annually to the 
                                Secretary, in such form and manner as 
                                specified by the Secretary.''.
    (c) Regulatory Authority.--Not later than July 1, 2023, the 
Secretary of the Treasury (or such Secretary's delegate) shall issue 
such regulations as may be necessary to carry out the purposes of the 
amendments made by this section, including regulations which--
            (1) require an automatic portability provider to provide a 
        notice to individuals on whose behalf the individual retirement 
        plan described in paragraph (12)(A)(i)(I) of section 4975(f) of 
        the Internal Revenue Code of 1986, as added by this section, is 
        established in advance of the notices specified in paragraph 
        (12)(B)(v) of such section, as so added,
            (2) restrict the receipt of third party compensation (other 
        than a direct fee by an employer sponsoring a plan which is in 
        lieu of a fee imposed on an individual retirement plan owner) 
        by an automatic portability provider in connection with an 
        automatic portability transaction,
            (3) prohibit exculpatory provisions in an automatic 
        portability provider's contracts or communications with 
        individuals disclaiming or limiting its liability in the event 
        that an automatic portability transaction results in an 
        improper transfer,
            (4) require an automatic portability provider to take 
        actions necessary to reasonably ensure that participant and 
        beneficiary data is current and accurate, and
            (5) ensure that the appropriate participants and 
        beneficiaries, in fact, receive all the required notices and 
        disclosures until the assets are transferred to a new 
        retirement plan account.
Any term used in this subsection which is used in paragraph (12) of 
section 4975(f) of such Code, as added by this section, has the same 
meaning as when used in such paragraph.
    (d) Effective Date.--The amendments made by this section shall 
apply to transactions occurring after December 31, 2023.

SEC. 119. APPLICATION OF SECTION 415 LIMIT FOR CERTAIN EMPLOYEES OF 
              RURAL ELECTRIC COOPERATIVES.

    (a) In General.--Section 415(b) is amended by adding at the end the 
following new paragraph:
            ``(12) Special rule for certain employees of rural electric 
        cooperatives.--
                    ``(A) In general.--Subparagraph (B) of paragraph 
                (1) shall not apply to a participant in an eligible 
                rural electric cooperative plan, except in the case of 
                a participant who was a highly compensated employee (as 
                defined in section 414(q)) of the employer maintaining 
                such plan for the earlier of--
                            ``(i) the plan year in which the 
                        participant terminated employment with such 
                        employer, or
                            ``(ii) the plan year in which distributions 
                        commence under the plan with respect to the 
                        participant, or
                for any of the 5 plan years immediately preceding such 
                earlier plan year.
                    ``(B) Eligible rural electric cooperative plan.--
                For purposes of this paragraph--
                            ``(i) In general.--The term `eligible rural 
                        electric cooperative plan' means a plan 
                        maintained by more than 1 employer, if at least 
                        85 percent of the employers maintaining the 
                        plan are rural cooperatives described in clause 
                        (i) or (ii) of section 401(k)(7)(B) or are a 
                        national association of such a rural 
                        cooperative.
                            ``(ii) Election.--An employer maintaining 
                        an eligible rural cooperative plan may elect 
                        not to have subparagraph (A) apply.
                    ``(C) Regulations.--The Secretary shall prescribe 
                such regulations and other guidance as are necessary to 
                limit the application of subparagraph (A) such that it 
                does not result in increased benefits for highly 
                compensated employees.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to limitation years ending after the date of the enactment of this Act.

SEC. 120. 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 Secretary of the Treasury (or 
the Secretary's delegate) shall amend the regulation issued by the 
Department of the Treasury relating to ``Income Tax; Diversification 
Requirements for Variable Annuity, Endowment, and Life Insurance 
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 Secretary of the Treasury (or the Secretary's 
delegate) shall amend Treas. Reg. section 1.817-5(f)(3) to provide that 
satisfaction of the requirements in Treas. Reg. section 1.817-
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 delegate) shall provide definitions 
consistent with the following:
            (1) Exchange-traded fund.--The term ``exchange-traded 
        fund'' means a regulated investment company, partnership, or 
        trust--
                    (A) that is registered with the Securities and 
                Exchange Commission as an open-end investment company 
                or a unit investment trust;
                    (B) the shares of which can be purchased or 
                redeemed directly from the fund only by an authorized 
                participant; and
                    (C) the shares of which are traded throughout the 
                day on a national stock exchange at market prices that 
                may or may not be the same as the net asset value of 
                the shares.
            (2) Authorized participant.--The term ``authorized 
        participant'' means a financial institution that is a member or 
        participant of a clearing agency registered under section 
        17A(b) of the Securities Exchange Act of 1934 that enters into 
        a contractual relationship with an exchange-traded fund 
        pursuant to which the financial institution is permitted to 
        purchase 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 investment 
                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 institution 
        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).
    (d) Effective Date.--This section shall apply to segregated asset 
account investments made on or after the date which is 7 years after 
the date of the enactment of this Act.

SEC. 121. 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''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2025.

SEC. 122. ASSIST SAVERS IN RECOVERING UNCLAIMED SAVINGS BONDS.

    Section 3105 of title 31, United States Code, is amended by adding 
at the end the following:
    ``(f)(1) The Secretary shall provide each State, in digital or 
other electronic form (including digital images), with all information 
concerning any applicable savings bond which is registered to an owner 
with a last known address that is within such State, including the 
serial number of the bond, the name and last known address of such 
owner, and all records of any transactions involving such bond.
    ``(2)(A) The Secretary shall prescribe such regulations or other 
guidance as may be necessary to carry out the purposes of this 
subsection, including rules to--
                    ``(i) protect the privacy of the owners of 
                applicable savings bonds; and
                    ``(ii) ensure that any information provided to a 
                State under this subsection shall be used solely to 
                carry out the purposes of this subsection.
            ``(B) Any regulations or guidance prescribed by the 
        Secretary pursuant to subparagraph (A) shall not have the 
        effect of prohibiting, restricting, or otherwise preventing a 
        State from obtaining all information described in paragraph 
        (1).
    ``(3) Not later than 12 months after the date of enactment of this 
subsection, and annually thereafter, the Secretary shall submit to the 
Committee on Appropriations and the Committee on Finance of the Senate 
a report assessing all efforts to satisfy the requirement under 
paragraph (1).
    ``(4) Any State that receives information described in paragraph 
(1) with respect to an applicable savings bond may use such information 
to locate the registered owner of such bond pursuant to the same 
standards and requirements as are applicable under the abandoned 
property rules and regulations of such State.
    ``(5) For purposes of this subsection, the term `applicable savings 
bond' means a matured savings bond, and all payment of such bond, 
including interest, for which such bond--
            ``(A) was originally in paper, paperless, or electronic 
        form; and
            ``(B) has not been redeemed by the registered owner.''.

                           TITLE II--RETIREES

SEC. 201. INCREASE IN AGE FOR REQUIRED BEGINNING DATE FOR MANDATORY 
              DISTRIBUTIONS.

    (a) Increase in Age for Required Beginning Date.--
            (1) In general.--Subclause (I) of section 401(a)(9)(C)(i) 
        is amended to read as follows:
                                    ``(I) the first calendar year in 
                                which the employee attains the 
                                applicable age for such calendar year, 
                                or''.
            (2) Special rule for owners.--Subclause (I) of section 
        401(a)(9)(C)(ii) is amended by striking ``in which the employee 
        attains age 72'' and inserting ``described in clause (i)(I) 
        with respect to the employee''.
    (b) Mandatory Distribution Age.--Paragraph (9) of section 401(a) is 
amended by inserting at the end the following new subparagraph:
                    ``(J) Applicable age.--For purposes of this 
                paragraph--
                            ``(i) In general.--The applicable age is--
                                    ``(I) for calendar years before 
                                2032, age 72, and
                                    ``(II) for calendar years after 
                                2031, age 75.
                            ``(ii) Transition rule.--If, as of a 
                        calendar year, an employee has not attained the 
                        applicable age with respect to such year, such 
                        employee shall be treated as not having 
                        attained the applicable age under this 
                        paragraph for such year without regard to 
                        whether, in a previous calendar year, the 
                        employee had attained the applicable age with 
                        respect to such previous calendar year.''.
    (c) Spouse Beneficiaries.--Subclause (I) of section 
401(a)(9)(B)(iv) is amended by striking ``age 72'' and inserting ``the 
applicable age''.
    (d) Conforming Amendment.--Subsection (b) of section 408 is amended 
by striking ``age 72'' and inserting ``the applicable age determined 
under section 401(a)(9)(J) with respect to such individual''.
    (e) Effective Date.--The amendments made by this section shall 
apply to calendar years beginning 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 requirement that premiums for qualifying 
        longevity annuity contracts be limited to 25 percent of an 
        individual's account balance, and to make such corresponding 
        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 delegate) 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 beginning 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 
                subparagraph (A)) will be adjusted at the same time and 
                in the same manner as the limits are adjusted under 
                section 415(d) of the Internal Revenue 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 increase 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 benefits.--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 related forms as are necessary, to provide 
        that, in the case of a qualifying longevity annuity contract 
        which was purchased with joint and survivor annuity benefits 
        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 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 entitled to 
                the survivor benefits under the contract;
                    (B) does not modify the treatment of the former 
                spouse as the beneficiary under the contract who is 
                entitled to the survivor benefits; or
                    (C) does not modify the treatment of the former 
                spouse as the measuring life for the survivor 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 purposes of subsection 
(a)(2), the term ``divorce or separation instrument'' means--
            (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)) requiring a 
        spouse to make payments for the support or maintenance of the 
        other spouse.
    (c) Effective Dates, Enforcement, and Interpretations.--
            (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 Treasury issues final regulations 
        pursuant to subsection (a)--
                    (A) the Secretary (or delegate) shall administer 
                and enforce the law in accordance with subsection (a) 
                and the effective dates in paragraph (1) of this 
                subsection; and
                    (B) taxpayers may rely upon their reasonable good 
                faith interpretations of subsection (a).
    (d) Regulatory Successor Provision.--Any reference to a regulation 
under this section shall be treated as including a reference to any 
successor regulation thereto.

SEC. 203. REMOVE REQUIRED MINIMUM DISTRIBUTION BARRIERS FOR LIFE 
              ANNUITIES.

    (a) In General.--Section 401(a)(9), as amended by this Act, is 
further amended by adding at the end the following new subparagraph:
                    ``(K) 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 retirement 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 starting 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--
                                    ``(I) results in a shortening of 
                                the payment period with respect to an 
                                annuity or a full or partial 
                                commutation of the future annuity 
                                payments, provided that such lump sum 
                                is determined using reasonable 
                                actuarial methods and assumptions, as 
                                determined in good faith by the issuer 
                                of the contract, or
                                    ``(II) accelerates the receipt of 
                                annuity payments that are scheduled to 
                                be received within the ensuing 12 
                                months, regardless of whether such 
                                acceleration 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 suspension of annuity 
                                payments during the period being 
                                accelerated,
                            ``(iii) an amount which is in the nature of 
                        a dividend or similar distribution, provided 
                        that the issuer of the contract determines such 
                        amount based on a reasonable comparison of the 
                        actuarial factors assumed 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 take effect on 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 section 401(a)(9) of the Internal Revenue Code of 
1986 to provide that if an employee's benefit is in the form of an 
individual 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 successor 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 
        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 described 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 individual holds 
as a beneficiary of the same decedent, as one such contract for such 
purposes.
    (d) Effective Date.--The modifications and amendments required 
under subsections (a) and (c) shall be 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 respects 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.

SEC. 205. REDUCTION IN EXCISE TAX ON CERTAIN ACCUMULATIONS 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.--
            ``(1) Reduction.--In the case of a taxpayer who--
                    ``(A) receives a distribution, during the 
                correction 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 correction 
                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 deficiency 
                with respect to the tax imposed by subsection (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.''.
    (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. 206. CLARIFICATION OF SUBSTANTIALLY EQUAL PERIODIC PAYMENT RULE.

    (a) In General.--Paragraph (4) of section 72(t) is amended by 
inserting at the end the following new subparagraph:
                    ``(C) Rollovers to subsequent plan.--If--
                            ``(i) payments described in paragraph 
                        (2)(A)(iv) are being made from a qualified 
                        retirement plan,
                            ``(ii) a transfer or a rollover from such 
                        qualified retirement plan of all or a portion 
                        of the taxpayer's benefit under the plan is 
                        made to another qualified retirement plan, and
                            ``(iii) distributions from the transferor 
                        and transferee plans would in combination 
                        continue to satisfy the requirements of 
                        paragraph (2)(A)(iv) if they had been made only 
                        from the transferor plan,
                such transfer or rollover shall not be treated as a 
                modification under subparagraph (A)(ii), and compliance 
                with paragraph (2)(A)(iv) shall be determined on the 
                basis of the combined distributions described in clause 
                (iii).''.
    (b) Nonqualified Annuity Contracts.--Paragraph (3) of section 72(q) 
is amended--
            (1) by redesignating clauses (i) and (ii) of subparagraph 
        (B) as subclauses (I) and (II), and by moving such subclauses 2 
        ems to the right;
            (2) by redesignating subparagraphs (A) and (B) as clauses 
        (i) and (ii), by moving such clauses 2 ems to the right, and by 
        adjusting the flush language at the end accordingly;
            (3) by striking ``payments.--If'' and inserting 
        ``payments.--
                    ``(A) In general.--If--''; and
            (4) by adding at the end the following new subparagraph:
                    ``(B) Exchanges to subsequent contracts.--If--
                            ``(i) payments described in paragraph 
                        (2)(D) are being made from an annuity contract,
                            ``(ii) an exchange of all or a portion of 
                        such contract for another contract is made 
                        under section 1035, and
                            ``(iii) the aggregate distributions from 
                        the contracts involved in the exchange continue 
                        to satisfy the requirements of paragraph (2)(D) 
                        as if the exchange had not taken place,
                such exchange shall not be treated as a modification 
                under subparagraph (A)(ii), and compliance with 
                paragraph (2)(D) shall be determined on the basis of 
                the combined distributions described in clause 
                (iii).''.
    (c) Information Reporting.--Section 6724 is amended by inserting at 
the end the following new subsection:
    ``(g) Special Rule for Reporting Certain Additional Taxes.--No 
penalty shall be imposed under section 6721 or 6722 if--
            ``(1) a person makes a return or report under section 
        6047(d) or 408(i) with respect to any distribution,
            ``(2) such distribution is made following a rollover, 
        transfer, or exchange described in section 72(t)(4)(C) or 
        section 72(q)(3)(C),
            ``(3) in making such return or report the person relies 
        upon a certification provided by the taxpayer that the 
        distributions satisfy the requirements of section 
        72(t)(4)(C)(iii) or section 72(q)(3)(B)(iii), as applicable, 
        and
            ``(4) such person does not have actual knowledge that the 
        distributions do not satisfy such requirements.''.
    (d) Safe Harbor for Annuity Payments.--
            (1) Qualified retirement plans.--Subparagraph (A) of 
        section 72(t)(2) is amended by adding at the end the following 
        flush sentence:
                ``For purposes of clause (iv), periodic payments shall 
                not fail to be treated as substantially equal merely 
                because they are amounts received as an annuity, and 
                such periodic payments shall be deemed to be 
                substantially equal if they are payable over a period 
                described in clause (iv) and satisfy the requirements 
                applicable to annuity payments under section 
                401(a)(9).''.
            (2) Other annuity contracts.--Paragraph (2) of section 
        72(q) is amended by adding at the end the following flush 
        sentence:
        ``For purposes of subparagraph (D), periodic payments shall not 
        fail to be treated as substantially equal merely because they 
        are amounts received as an annuity, and such periodic payments 
        shall be deemed to be substantially equal if they are payable 
        over a period described in subparagraph (D) and would satisfy 
        the requirements applicable to annuity payments under section 
        401(a)(9) if such requirements applied.''.
    (e) Effective Dates.--
            (1) In general.--The amendments made by subsections (a), 
        (b), and (c) shall apply to transfers, rollovers, and exchanges 
        occurring on or after the date of the enactment of this Act.
            (2) Annuity payments.--The amendment made by subsection (d) 
        shall apply to distributions commencing on or after the date of 
        the enactment of this Act.
            (3) No inference.--Nothing in the amendments made by this 
        section shall be construed to create an inference with respect 
        to the law in effect prior to the effective date of such 
        amendments.

SEC. 207. RECOVERY OF RETIREMENT PLAN OVERPAYMENTS.

    (a) 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--
                    ``(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 future benefit payments 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.--Paragraph (1) shall not fail to apply 
        to a plan merely because, 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 persons 
                responsible for such overpayment.
            ``(3) Employer funding obligations.--Nothing in this 
        subsection shall relieve an employer of any obligation imposed 
        on it to make contributions to a plan to satisfy the minimum 
        funding standards under sections 412 and 430 or to prevent or 
        restore an impermissible 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 
        approved by the Secretary for recouping benefits previously 
        paid or allocations previously made in excess of such 
        limitations.
            ``(5) Coordination with other qualification requirements.--
        The Secretary may issue regulations or other guidance of 
        general applicability specifying 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 
        paragraph (1) applies.''.
    (b) Rollovers.--Section 402(c) is amended by adding at the end the 
following new paragraph:
            ``(12) In the case of an inadvertent benefit overpayment 
        from a plan to which section 414(aa)(1) applies which is 
        transferred to an eligible retirement plan by or on behalf of a 
        participant or beneficiary--
                    ``(A) the portion of such overpayment with respect 
                to which recoupment is not sought on behalf 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 making and receiving such 
                transfer shall be treated as permitting such 
                transfer).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after the date of the enactment of this 
Act.
    (d) Certain Actions Before Effective Date.--Plans, fiduciaries, 
employers, and plan sponsors are entitled to rely on a reasonable good 
faith interpretation of then existing administrative guidance for 
inadvertent benefit overpayment recoupments and recoveries that 
commenced before the first day of the first plan year beginning after 
the date of the enactment of this Act.

SEC. 208. RETIREMENT SAVINGS LOST AND FOUND.

    (a) Retirement Savings Lost and Found.--
            (1) Establishment.--
                    (A) In general.--Not later than 3 years after the 
                date of the enactment of this Act, the Secretary of the 
                Treasury, in consultation with the Secretary of Labor, 
                the Secretary of Commerce, and the Director of the 
                Pension Benefit Guaranty Corporation, shall establish 
                an online searchable database (to be managed by the 
                Secretary of the Treasury in accordance with section 
                7901 of the Internal Revenue Code of 1986) to be known 
                as the ``Retirement Savings Lost and Found''. The 
                Retirement Savings Lost and Found shall--
                            (i) allow an individual to search for 
                        information that enables the individual to 
                        locate the plan administrator of any plans with 
                        respect to which the individual is or was a 
                        participant or beneficiary, and to provide 
                        contact information for the plan administrator 
                        of any plan described in subparagraph (B);
                            (ii) allow the Secretary of the Treasury to 
                        assist such an individual in locating any plan 
                        of the individual; and
                            (iii) allow the Secretary of the Treasury 
                        to make any necessary changes to contact 
                        information on record for the plan 
                        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, termination, change 
                        in name of the plan, change in name or address 
                        of the plan administrator, or other causes.
                The Retirement Savings Lost and Found established under 
                this paragraph shall include information reported under 
                section 7901 of such Code and other relevant 
                information obtained by the Secretary of the Treasury.
                    (B) Plans described.--A plan described in this 
                subparagraph is a plan to which the vesting standards 
                of section 411 of the Internal Revenue Code of 1986 
                apply.
            (2) Administration.--The Retirement Savings Lost and Found 
        established under paragraph (1) shall provide individuals 
        described in paragraph (1)(A) only with the ability to view 
        contact information for the plan administrator of any plan with 
        respect to which the individual is or was a participant or 
        beneficiary, sufficient to allow the individual to locate the 
        individual's plan in order to recover any benefit owing to the 
        individual under the plan.
            (3) Safeguarding participant privacy and security.--
                    (A) In general.--In establishing the Retirement 
                Savings Lost and Found under paragraph (1), the 
                Secretary of the Treasury, in consultation with the 
                Secretary of Labor, the Secretary of Commerce, and the 
                Director of the Pension Benefit Guaranty Corporation, 
                shall take all necessary and proper precautions to 
                ensure that individuals' plan information maintained by 
                the Retirement Savings Lost and Found is protected and 
                that persons other than the individual cannot 
                fraudulently claim the benefits to which any individual 
                is entitled, and to allow any individual to opt out of 
                inclusion in the Retirement Savings Lost and Found at 
                the election of the individual.
                    (B) Disclosure.--The Secretary of the Treasury may, 
                through regulations or other guidance--
                            (i) authorize disclosure to the agencies 
                        jointly administering the Retirement Savings 
                        Lost and Found of such return information as is 
                        necessary to administer the Retirement Savings 
                        Lost and Found database, but only to such 
                        employees whose official duties with respect to 
                        the database require such disclosure, and
                            (ii) authorize disclosure to plan 
                        participants and beneficiaries of the contact 
                        information for the plan administrator of any 
                        plan with respect to which such individuals are 
                        or were a participant or beneficiary.
            (4) Secretary.--Any reference in this subsection to the 
        Secretary of the Treasury includes such Secretary's delegate.
    (b) Office of the Retirement Savings Lost and Found.--
            (1) In general.--Subtitle F is amended by adding at the end 
        the following new chapter:

     ``CHAPTER 81--OFFICE OF THE RETIREMENT SAVINGS LOST AND FOUND

``Sec. 7901. Office of the Retirement Savings Lost and Found.

``SEC. 7901. OFFICE OF THE RETIREMENT SAVINGS LOST AND FOUND.

    ``(a) Establishment; Responsibilities of Office.--
            ``(1) In general.--Not later than 2 years after the date of 
        the enactment of this section, the Secretary shall establish 
        within the Department of the Treasury an Office of the 
        Retirement Savings Lost and Found (in this section referred to 
        as the `Office').
            ``(2) Responsibilities of office.--The Office shall--
                    ``(A) carry out subsection (b),
                    ``(B) maintain the Retirement Savings Lost and 
                Found established under section 208(a) of the Enhancing 
                American Retirement Now Act, and
                    ``(C) perform an annual audit of plan information 
                contained in the Retirement Savings Lost and Found and 
                ensure that such information is current and accurate.
    ``(b) Certain Non-Responsive Participants Entitled to Small 
Benefits.--
            ``(1) General rule.--
                    ``(A) Transfer to the office of the retirement 
                savings lost and found.--The administrator of a plan 
                which is not terminated and to which section 
                401(a)(31)(B) applies shall transfer to the Office the 
                amount required to be transferred under section 
                401(a)(31)(B)(iv) for a non-responsive participant.
                    ``(B) Information and payment to the office.--Upon 
                making a transfer under subparagraph (A), the plan 
                administrator shall provide such information and 
                certifications as the Office shall specify, including 
                with respect to the transferred amount and the non-
                responsive participant.
                    ``(C) Information requirements after transfer.--In 
                the event that, after a transfer is made under 
                subparagraph (A), the relevant non-responsive 
                participant contacts the plan administrator or the plan 
                administrator discovers information that may assist the 
                Office in locating the non-responsive participant, the 
                plan administrator shall notify and provide such 
                information as the Office shall specify to the Office.
                    ``(D) Search and payment by the office following 
                transfer.--The Office shall periodically, and upon 
                receiving information described in subparagraph (C), 
                conduct a search for the non-responsive participant for 
                whom the Office has received a transfer under 
                subparagraph (A). Upon location of a non-responsive 
                participant who claims benefits, the Office shall make 
                a single payment to the non-responsive participant in 
                an amount equal to the sum of--
                            ``(i) the amount transferred to the Office 
                        under subparagraph (A) for such participant, 
                        and
                            ``(ii) any earnings on the amount described 
                        in clause (i)
            ``(2) Definition.--For purposes of this subsection, the 
        term `non-responsive participant' means a participant or 
        beneficiary of a plan described in paragraph (1)(A)--
                    ``(A) who is entitled to a benefit subject to a 
                mandatory transfer under section 401(a)(31)(B)(iii), 
                and
                    ``(B) for whom the plan has satisfied the 
                conditions in section 401(a)(31)(B)(iv).
            ``(3) Regulatory authority.--The Secretary shall prescribe 
        such regulations as are necessary to carry out the purposes of 
        this section, including rules relating to the amount payable to 
        the Office and the amount to be paid by the Office.
    ``(c) Information Collection.--Within such period after the end of 
a plan year as the Secretary may by regulations prescribe, the 
administrator of a plan to which the vesting standards of section 411 
apply shall submit to the Office in such form as the Secretary may 
require--
            ``(1) the information described in paragraphs (1) through 
        (4) of section 6057(b),
            ``(2) the information described in subparagraphs (A), (B), 
        (E), and (F) of section 6057(a)(2), and
            ``(3) such other information as the Secretary may require.
    ``(d) Effective Date.--The requirements of subsections (b) and (c) 
shall apply with respect to plan years beginning after the second 
December 31 occurring after the date of the enactment of this section.
    ``(e) Establishment of Fund.--
            ``(1) In general.--A fund shall be established within the 
        Treasury for the payment of benefits under subsection 
        (b)(1)(D). Such fund shall be credited with the appropriate--
                    ``(A) amounts transferred to the Office of the 
                Retirement Savings Lost and Found under subsection 
                (b)(1)(A), and
                    ``(B) earnings on investments of the fund or on 
                assets credited to the fund.
            ``(2) Investment of funds.--Whenever the Secretary 
        determines that the moneys of any fund are in excess of current 
        needs, the Secretary may invest such amounts as the Secretary 
        determines advisable in obligations issued or guaranteed by the 
        United States.''.
            (2) Conforming amendment.--The table of chapters for 
        subtitle F is amended by adding at the end the following new 
        item:

    ``Chapter 81--Office of the Retirement Savings Lost and Found''.

    (c) Mandatory Transfers of Rollover Distributions.--
            (1) Cap.--Sections 401(a)(31)(B)(ii) and 411(a)(11)(A) are 
        each amended by striking ``$5,000'' and inserting ``$6,000''.
            (2) Distribution of larger amounts to individual retirement 
        plans only.--Section 401(a)(31)(B)(i) is amended by adding at 
        the end the following: ``The Retirement Savings Lost and Found 
        established by section 208 of the Enhancing American Retirement 
        Now Act shall not be treated as a trustee or issuer which is 
        eligible to receive such distributions.''.
            (3) Lesser amounts.--Section 401(a)(31)(B) is amended by 
        adding at the end the following new clauses:
                            ``(iii) Treatment of lesser amounts.--In 
                        the case of a trust which is part of an 
                        eligible plan, such trust shall not be a 
                        qualified trust under this section unless such 
                        plan provides that, if a participant in the 
                        plan separates from the service covered by the 
                        plan and the nonforfeitable accrued benefit 
                        described in clause (ii) is not in excess of 
                        $1,000, the plan administrator shall (either 
                        separately or as part of the notice under 
                        section 402(f)) notify the participant that the 
                        participant is entitled to such benefit or 
                        attempt to pay the benefit directly to the 
                        participant.
                            ``(iv) Transfers to retirement savings lost 
                        and found.--If, after a plan administrator 
                        takes the action required under clause (iii), 
                        the participant does not--
                                    ``(I) within 6 months of the 
                                notification under such clause, make an 
                                election under subparagraph (A) or 
                                elect to receive a distribution of the 
                                benefit directly, or
                                    ``(II) accept any direct payment 
                                made under such clause within 6 months 
                                of the attempted payment,
                        the plan administrator shall transfer the 
                        amount of such benefit to the Office of the 
                        Retirement Savings Lost and Found in accordance 
                        with section 7901.
                            ``(v) Income tax treatment of transfers to 
                        retirement savings lost and found.--For 
                        purposes of determining the income tax 
                        treatment of transfers to the Office of the 
                        Retirement Savings Lost and Found under clause 
                        (iv)--
                                    ``(I) such a transfer shall be 
                                treated as a transfer to an individual 
                                retirement plan under clause (i), and
                                    ``(II) the distribution of such 
                                amounts by the Office of the Retirement 
                                Savings Lost and Found shall be treated 
                                as a distribution from an individual 
                                retirement plan.''.
            (4) Effective date.--The amendments made by this subsection 
        shall apply to vested benefits with respect to participants who 
        separate from service connected to the plan in plan years 
        beginning after the second December 31 occurring after the date 
        of the enactment of this Act.
    (d) Better Reporting for Mandatory Transfers.--
            (1) In general.--Paragraph (2) of section 6057(a) is 
        amended--
                    (A) in subparagraph (C)--
                            (i) by striking ``during such plan year'' 
                        in clause (i) and inserting ``during the plan 
                        year immediately preceding such plan year'';
                            (ii) by adding ``and'' at the end of clause 
                        (i); and
                            (iii) by striking clause (iii);
                    (B) by redesignating subparagraph (E) as 
                subparagraph (G);
                    (C) by striking ``and'' at the end of subparagraph 
                (D); and
                    (D) by inserting after subparagraph (D) the 
                following new subparagraphs:
                    ``(E) the name and taxpayer identifying number of 
                each participant or former participant in the plan--
                            ``(i) who, during the current plan year or 
                        any previous plan year, was reported under 
                        subparagraph (C), and with respect to whom the 
                        benefits described in subparagraph (C)(ii) were 
                        fully paid during the plan year,
                            ``(ii) with respect to whom any amount was 
                        distributed under section 401(a)(31)(B) during 
                        the plan year, or
                            ``(iii) with respect to whom a deferred 
                        annuity contract was distributed during the 
                        plan year,
                    ``(F) in the case of a participant or former 
                participant to whom subparagraph (E) applies--
                            ``(i) in the case of a participant 
                        described in clause (ii) thereof, the name and 
                        address of the designated trustee or issuer 
                        described in section 401(a)(31)(B)(i) and the 
                        account number of the individual retirement 
                        plan to which the amount was distributed, and
                            ``(ii) in the case of a participant 
                        described in clause (iii) thereof, the name and 
                        address of the issuer of such annuity contract 
                        and the contract or certificate number, and''.
            (2) Rules relating to direct trustee-to-trustee 
        transfers.--
                    (A) In general.--Paragraph (6) of section 402(e) is 
                amended--
                            (i) by striking ``transfers.--Any'' and 
                        inserting ``transfers.--
                    ``(A) In general.--Any''; and
                            (ii) by adding at the end the following new 
                        subparagraph:
                    ``(B) Notification of trustee.--In the case of a 
                distribution under section 401(a)(31)(B), the plan 
                administrator shall notify the designated trustee or 
                issuer described in clause (i) thereof that the 
                transfer is a mandatory distribution required by such 
                section.''.
                    (B) Penalty.--Subsection (i) of section 6652 is 
                amended--
                            (i) by striking ``to Recipients'' in the 
                        heading and inserting ``or Notification'';
                            (ii) by striking ``402(f),'' and inserting 
                        ``402(f) or a notification as required by 
                        section 402(e)(6)(B),''; and
                            (iii) by striking ``such written 
                        explanation'' and inserting ``such written 
                        explanation or notification''.
                    (C) Reports.--Subsection (i) of section 408 is 
                amended--
                            (i) by redesignating subparagraphs (A) and 
                        (B) of paragraph (2) as clauses (i) and (ii), 
                        respectively, and by moving such clauses 2 ems 
                        to the right;
                            (ii) by redesignating paragraphs (1) and 
                        (2) as subparagraphs (A) and (B), respectively, 
                        and by moving such subparagraphs 2 ems to the 
                        right; and
                            (iii) by striking ``as the Secretary 
                        prescribes'' in subparagraph (B)(ii), as so 
                        redesignated, and all that follows through ``a 
                        simple retirement account'' and inserting ``as 
                        the Secretary prescribes.
            ``(3) Simple retirement accounts.--In the case of a simple 
        retirement account'';
                            (iv) by striking ``Reports.--The trustee 
                        of'' and inserting ``Reports.--
            ``(1) In general.--The trustee of'';
                            (v) by striking ``under paragraph (2)'' in 
                        paragraph (3), as redesignated by clause (iii), 
                        and inserting ``under paragraph (1)(B)''; and
                            (vi) by inserting after paragraph 
                        (1)(B)(ii), as redesignated by the preceding 
                        clauses, the following new paragraph:
            ``(2) Mandatory distributions.--In the case of an account, 
        contract, or annuity to which a transfer under section 
        401(a)(31)(B) is made (including a transfer from the individual 
        retirement plan to which the original transfer under such 
        section was made to another individual retirement plan), the 
        report required by this subsection for the year of the transfer 
        and any year in which the information previously reported in 
        subparagraph (B) changes shall--
                    ``(A) identify such transfer as a mandatory 
                distribution required by such section, and
                    ``(B) include the name, address, and taxpayer 
                identifying number of the trustee or issuer of the 
                individual retirement plan to which the amount is 
                transferred.''.
            (3) Notification of participants upon separation.--
        Subsection (e) of section 6057 is amended by inserting ``, and, 
        with respect to any benefit of the individual subject to 
        section 401(a)(31)(B), a notice of availability of, and the 
        contact information for, the Retirement Savings Lost and Found 
        established under section 208(a) of the Enhancing American 
        Retirement Now Act'' before the period at the end of the second 
        sentence.
            (4) Effective date.--The amendments made by this subsection 
        shall apply to distributions made in, and returns and reports 
        relating to, years beginning after the second December 31 
        occurring after the date of the enactment of this Act.
    (e) Requirement of Electronic Filing.--
            (1) In general.--Paragraph (2) of section 6011(e) is 
        amended--
                    (A) by redesignating subparagraphs (A) and (B) as 
                clauses (i) and (ii), respectively, and by moving such 
                clauses 2 ems to the right;
                    (B) by striking ``regulations.--In prescribing'' 
                and inserting ``regulations.--
                    ``(A) In general.--In prescribing''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(C) Exceptions.--Notwithstanding subparagraph 
                (A), the Secretary shall require returns or reports 
                required under--
                            ``(i) sections 6057, 6058, and 6059, and
                            ``(ii) sections 408(i), 6041, and 6047 to 
                        the extent such return or report relates to the 
                        tax treatment of a distribution from a plan, 
                        account, contract, or annuity,
                to be filed on magnetic media, but only with respect to 
                persons who are required to file at least 50 returns 
                during the calendar year which includes the first day 
                of the plan year to which such returns or reports 
                relate.''.
            (2) Effective date.--The amendments made by this subsection 
        shall apply to returns and reports relating to years beginning 
        after the second December 31 occurring after the date of the 
        enactment of this Act.

SEC. 209. ROTH PLAN DISTRIBUTION RULES.

    (a) In General.--Subsection (d) of section 402A is amended by 
adding at the end the following new paragraph:
            ``(5) Mandatory distribution rules not to apply before 
        death.--Notwithstanding sections 403(b)(10) and 457(d)(2), the 
        following provisions shall not apply to any designated Roth 
        account:
                    ``(A) Section 401(a)(9)(A).
                    ``(B) The incidental death benefit requirements of 
                section 401(a).''.
    (b) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendment made by this section shall apply to taxable years 
        beginning after December 31, 2023.
            (2) Special rule.--The amendment made by this section shall 
        not apply to distributions which are required with respect to 
        years beginning before January 1, 2024, but are permitted to be 
        paid on or after such date.

SEC. 210. ONE-TIME ELECTION FOR QUALIFIED CHARITABLE DISTRIBUTION TO 
              SPLIT-INTEREST ENTITY; INCREASE IN QUALIFIED CHARITABLE 
              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:
                    ``(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 subparagraph 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-interest 
                        entity, but only if--
                                    ``(I) an election is not in effect 
                                under this subparagraph for a preceding 
                                taxable year,
                                    ``(II) the aggregate amount of 
                                distributions of the taxpayer with 
                                respect to which an election under this 
                                subparagraph 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 
                                annuity trust (as defined in section 
                                664(d)(1)), but only if such trust is 
                                funded exclusively by qualified 
                                charitable distributions,
                                    ``(II) a charitable remainder 
                                unitrust (as defined in section 
                                664(d)(2)), but only if such unitrust 
                                is funded exclusively by qualified 
                                charitable distributions, or
                                    ``(III) a charitable gift annuity 
                                (as defined in section 501(m)(5)), but 
                                only if such annuity is funded 
                                exclusively by qualified charitable 
                                distributions and commences fixed 
                                payments of 5 percent or greater not 
                                later than 1 year from the date of 
                                funding.
                            ``(iii) Contributions must be otherwise 
                        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 specified 
                                charitable organization would be 
                                allowable under section 170 (determined 
                                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 distribution 
                                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 
                                paragraph).
                            ``(iv) Limitation on income interests.--A 
                        distribution meets the requirements 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.--
                                    ``(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 section 664(d)(1)(A) or 
                                the payment described in section 
                                664(d)(2)(A) is paid.
                                    ``(II) Charitable gift annuities.--
                                Qualified charitable distributions made 
                                to fund a charitable gift annuity shall 
                                not be treated as an investment 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--
                                    ``(I) such dollar amount, 
                                multiplied 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. 211. EXCEPTION TO PENALTY ON EARLY DISTRIBUTIONS FROM QUALIFIED 
              PLANS FOR INDIVIDUALS WITH A TERMINAL ILLNESS.

    (a) In General.--Section 72(t)(2), as amended by this Act, is 
further amended by adding at the end the following new subparagraph:
                    ``(K) Terminal illness.--
                            ``(i) In general.--Distributions which are 
                        made to the employee who is a terminally ill 
                        individual on or after the date on which such 
                        employee has been certified by a physician as 
                        having a terminal illness.
                            ``(ii) Definition.--For purposes of this 
                        subparagraph, the term `terminally ill 
                        individual' has the same meaning given such 
                        term under section 101(g)(4)(A), except that 
                        `84 months' shall be substituted for `24 
                        months'.
                            ``(iii) Documentation.--For purposes of 
                        this subparagraph, an employee shall not be 
                        considered to be a terminally ill individual 
                        unless such employee furnishes sufficient 
                        evidence to the plan administrator in such form 
                        and manner as the Secretary may require.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to distributions made after the date of the enactment of this Act.

SEC. 212. SURVIVING SPOUSE ELECTION TO BE TREATED AS EMPLOYEE.

    (a) In General.--Section 401(a)(9)(B)(iv), as amended by this Act, 
is further amended to read as follows:
                            ``(iv) Special rule for surviving spouse of 
                        employee.--If the designated beneficiary 
                        referred to in clause (iii)(I) is the surviving 
                        spouse of the employee and the surviving spouse 
                        elects the treatment in this clause--
                                    ``(I) the regulations referred to 
                                in clause (iii)(II) shall treat the 
                                surviving spouse as if the surviving 
                                spouse were the employee,
                                    ``(II) the date on which the 
                                distributions are required to begin 
                                under clause (iii)(III) shall not be 
                                earlier than the date on which the 
                                employee would have attained the 
                                applicable age, and
                                    ``(III) if the surviving spouse 
                                dies before the distributions to such 
                                spouse begin, this subparagraph shall 
                                be applied as if the surviving spouse 
                                is the employee.
                        An election described in this clause shall be 
                        made at such time and in such manner as 
                        prescribed by the Secretary, shall include a 
                        timely notice to the plan administrator, and 
                        once made may not be revoked except with the 
                        consent of the Secretary.''.
    (b) Extension of Election of at Least as Rapidly Rule.--The 
Secretary shall amend Q&A-5(a) of Treasury Regulation section 
1.401(a)(9)-5 (or any successor regulation thereto) to provide that if 
the surviving spouse is the employee's sole designated beneficiary and 
the spouse elects treatment under section 401(a)(9)(B)(iv), then the 
applicable distribution period for distribution calendar years after 
the distribution calendar year including the employee's date of death 
is determined under the uniform lifetime table.
    (c) Effective Date.--The amendments made by this section shall 
apply to calendar years beginning after December 31, 2023.

SEC. 213. LONG-TERM CARE CONTRACTS PURCHASED WITH RETIREMENT PLAN 
              DISTRIBUTIONS.

    (a) In General.--Section 401(a) is amended by inserting after 
paragraph (38) the following new paragraph:
            ``(39) Qualified long-term care distributions.--
                    ``(A) In general.--A trust forming part of a 
                defined contribution plan shall not be treated as 
                failing to constitute a qualified trust under this 
                section solely by reason of allowing qualified long-
                term care distributions.
                    ``(B) Qualified long-term care distribution.--For 
                purposes of this paragraph--
                            ``(i) In general.--The term `qualified 
                        long-term care distribution' means so much of 
                        the distributions made during the taxable year 
                        as does not exceed, in the aggregate, the 
                        lesser of--
                                    ``(I) the amount paid by or 
                                assessed to the participant during the 
                                taxable year for or with respect to 
                                certified long-term care insurance for 
                                the participant or the participant's 
                                spouse (or other family member of the 
                                participant as provided by the 
                                Secretary by regulation), or
                                    ``(II) $2,500.
                            ``(ii) Adjustment for inflation.--In the 
                        case of taxable years beginning after December 
                        31, 2024, the $2,500 amount in clause (i)(II) 
                        shall be increased by an amount equal to--
                                    ``(I) such dollar amount, 
                                multiplied 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 2023' for 
                                `calendar year 2016' in subparagraph 
                                (A)(ii) thereof.
                        If any increase under the preceding sentence is 
                        not a multiple of $100, such amount shall be 
                        rounded to the nearest multiple of $100.
                    ``(C) Certified long-term care insurance.--The term 
                `certified long-term care insurance' means--
                            ``(i) a qualified long-term care insurance 
                        contract (as defined in section 7702B(b)) 
                        covering qualified long-term care services (as 
                        defined in section 7702B(c)),
                            ``(ii) coverage of the risk that an insured 
                        individual would become a chronically ill 
                        individual (within the meaning of section 
                        101(g)(4)(B)) under a rider or other provision 
                        of a life insurance contract which satisfies 
                        the requirements of section 101(g)(3) 
                        (determined without regard to subparagraph (D) 
                        thereof), or
                            ``(iii) coverage of qualified long-term 
                        care services (as so defined) under a rider or 
                        other provision of an insurance or annuity 
                        contract which is treated as a separate 
                        contract under section 7702B(e) and satisfies 
                        the requirements of section 7702B(g),
                if such coverage provides meaningful financial 
                assistance in the event the insured needs home-based or 
                nursing home care. For purposes of the preceding 
                sentence, coverage shall not be deemed to provide 
                meaningful financial assistance unless benefits are 
                adjusted for inflation and consumer protections are 
                provided, including protection in the event the 
                coverage is terminated.
                    ``(D) Distributions must otherwise be includible.--
                Rules similar to the rules of section 402(l)(3) shall 
                apply for purposes of this paragraph.
                    ``(E) Long-term care premium statement.--
                            ``(i) In general.--No distribution shall be 
                        treated as a qualified long-term care 
                        distribution unless a long-term care premium 
                        statement with respect to the participant has 
                        been filed with the plan.
                            ``(ii) Long-term care premium statement.--
                        For purposes of this paragraph, a long-term 
                        care premium statement is a statement provided 
                        by the issuer of long-term care coverage, upon 
                        request by the owner of such coverage, which 
                        includes--
                                    ``(I) the name and taxpayer 
                                identification number of such issuer,
                                    ``(II) a statement that the 
                                coverage is certified long-term care 
                                insurance,
                                    ``(III) identification of the 
                                participant as the owner of such 
                                coverage,
                                    ``(IV) identification of the 
                                individual covered and such 
                                individual's relationship to the 
                                participant,
                                    ``(V) the premiums owed for the 
                                coverage for the calendar year, and
                                    ``(VI) such other information as 
                                the Secretary may require.
                            ``(iii) Filing with secretary.--A long-term 
                        care premium statement will be accepted only if 
                        the issuer has completed a disclosure to the 
                        Secretary for the specific coverage product to 
                        which the statement relates. Such disclosure 
                        shall identify the issuer, type of coverage, 
                        and such other information as the Secretary may 
                        require which is included in the filing of the 
                        product with the applicable State authority.''.
    (b) Conforming Amendments.--
            (1) Section 401(k)(2)(B)(i) is amended by striking ``or'' 
        at the end of subclause (V), by adding ``or'' at the end of 
        subclause (VI), and by adding at the end the following new 
        subclause:
                                    ``(VII) as provided in section 
                                401(a)(39),''.
            (2) Section 403(a) is amended by adding at the end the 
        following new paragraph:
            ``(6) Qualified long-term care distributions.--An annuity 
        contract shall not fail to be subject to this subsection solely 
        by reason of allowing distributions to which section 401(a)(39) 
        applies.''.
            (3) Section 403(b)(11) is amended by striking ``or'' at the 
        end of subparagraph (C), by striking the period at the end of 
        subparagraph (D) and inserting ``, or'', and by inserting after 
        subparagraph (D) the following new subparagraph:
                    ``(E) for distributions to which section 401(a)(39) 
                applies.''.
            (4) Section 457(d)(1)(A) is amended by striking ``or'' at 
        the end of clause (iii), by striking the comma at the end of 
        clause (iv) and inserting ``, or'', and by adding at the end 
        the following new clause:
                            ``(v) as provided in section 401(a)(39),''.
    (c) Exemption From Additional Tax on Early Distributions.--Section 
72(t)(2), as amended by this Act, is further amended by adding at the 
end the following new subparagraph:
                    ``(L) Qualified long-term care distributions.--
                            ``(i) In general.--Any qualified long-term 
                        care distribution which meets the requirements 
                        of section 401(a)(39).
                            ``(ii) Exception.--If the individual 
                        covered by the long-term care coverage to which 
                        such distribution relates is the spouse of the 
                        participant in the plan, clause (i) shall apply 
                        only if the participant and the participant's 
                        spouse file a joint return.
                            ``(iii) Exemption of distributions from 
                        trustee to trustee transfer and withholding 
                        rules.--For purposes of sections 401(a)(31), 
                        402(f), and 3405, a qualified long-term care 
                        distribution shall not be treated as an 
                        eligible rollover distribution.''.
    (d) Reporting.--
            (1) In general.--Subpart B of part III of subchapter A of 
        chapter 61 is amended by adding at the end the following new 
        section:

``SEC. 6050Z. REPORTS RELATING TO LONG-TERM CARE PREMIUM STATEMENTS.

    ``(a) Requirement of Reporting.--Any issuer of certified long-term 
care insurance (as defined in section 401(a)(39)(C)) who provides a 
long-term care premium statement to any purchaser pursuant to section 
401(a)(39)(E) for a calendar year, shall make a return not later than 
February 1 of the succeeding calendar year, according to forms or 
regulations prescribed by the Secretary, setting forth with respect to 
each such purchaser--
            ``(1) the name and taxpayer identification number of such 
        issuer,
            ``(2) a statement that the coverage is certified long-term 
        care insurance as defined in section 401(a)(39)(C),
            ``(3) the name of the owner of such coverage,
            ``(4) identification of the individual covered and such 
        individual's relationship to the owner,
            ``(5) the premiums paid for the coverage for the calendar 
        year, and
            ``(6) such other information as the Secretary may require.
    ``(b) Statement to Be Furnished to Persons With Respect to Whom 
Information Is Required.--Every person required to make a return under 
subsection (a) shall furnish to each individual whose name is required 
to be set forth in such return a written statement showing--
            ``(1) the name, address, and phone number of the 
        information contact of the issuer of the contract or coverage, 
        and
            ``(2) the aggregate amount of premiums and charges paid 
        under the contract or coverage covering the insured individual 
        during the calendar year.
The written statement required under the preceding sentence shall be 
furnished to the individual or individuals on or before January 31 of 
the year following the calendar year for which the return required 
under subsection (a) was required to be made.
    ``(c) Contracts or Coverage Covering More Than One Insured.--In the 
case of contracts or coverage covering more than one insured, the 
return and statement required by subsections (a) and (b) shall identify 
only the portion of the premium that is properly allocable to the 
insured in respect of whom the return or statement is made.
    ``(d) Statement to Be Furnished on Request.--If any individual to 
whom a return is required to be furnished under subsection (b) requests 
that such a return be furnished at any time before the close of the 
calendar year, the person required to make the return under subsection 
(b) shall comply with such request and shall furnish to the Secretary 
at such time a copy of the return so provided.''.
            (2) Penalties.--Section 6724(d) is amended--
                    (A) in paragraph (1)(B), by adding ``or'' at the 
                end of clause (xxvii) and by inserting after such 
                clause the following new clause:
                            ``(xxviii) section 6050Z (relating to 
                        reports relating to long-term care premium 
                        statements), and'', and
                    (B) in paragraph (2)--
                            (i) by redesignating subparagraph (JJ), 
                        relating to section 6050Y, as subparagraph (KK) 
                        and moving such subparagraph to the position 
                        immediately after subparagraph (JJ), relating 
                        to section 6226(a)(2),
                            (ii) by striking ``or'' at the end of 
                        subparagraph (II),
                            (iii) by striking the period at the end of 
                        subparagraph (JJ), relating to section 
                        6226(a)(2), and inserting a comma,
                            (iv) by striking the period at the end of 
                        subparagraph (KK), as so redesignated, and 
                        inserting ``, or'', and
                            (v) by inserting after subparagraph (KK), 
                        as so redesignated, the following new 
                        subparagraph:
                    ``(LL) section 6050Z (relating to reports relating 
                to long-term care premium statements).''.
            (3) Clerical amendment.--The table of sections for subpart 
        B of part III of subchapter A of chapter 61 is amended by 
        adding after the item relating to section 6050Y the following 
        new item:

``Sec. 6050Z. Reports relating to long-term care premium statements.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to distributions made after the date which is 3 years after the 
date of the enactment of this Act.
    (f) Disclosure to Treasury of Long-term Care Insurance Products.--
The Secretary of the Treasury (or the Secretary's delegate) shall issue 
such forms and guidance as are necessary to collect the filing required 
by section 401(a)(39)(E)(iii) of the Internal Revenue Code of 1986, as 
added by this section.
    (g) Treasury Website.--The Secretary of the Treasury (or the 
Secretary's delegate) shall maintain a website that discloses 
information regarding long-term care insurance policies, including 
common policy features, factors to consider in selecting coverage 
levels, consumer protections, tax rules for premiums and benefits, and 
the special tax and distribution rules applicable to certified long-
term care insurance (as defined in section 401(a)(39)(C) of the 
Internal Revenue Code of 1986). Such website shall also identify 
issuers of certified long-term care insurance (as so defined) by State, 
issuer contact information, and other information specific to an issuer 
and its long-term care insurance which is included in the issuer's 
filing for such insurance with the applicable State authority and 
disclosed to the Secretary.

             TITLE III--PUBLIC SAFETY OFFICERS AND MILITARY

SEC. 301. MILITARY SPOUSE RETIREMENT PLAN ELIGIBILITY CREDIT FOR SMALL 
              EMPLOYERS.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
is amended by adding at the end the following new section:

``SEC. 45U. MILITARY SPOUSE RETIREMENT PLAN ELIGIBILITY CREDIT FOR 
              SMALL EMPLOYERS.

    ``(a) In General.--For purposes of section 38, in the case of any 
eligible small employer, the military spouse retirement plan 
eligibility credit determined under this section for any taxable year 
is an amount equal to the sum of--
            ``(1) $200 with respect to each military spouse who is an 
        employee of such employer and who is eligible to participate in 
        an eligible defined contribution plan of such employer at any 
        time during such taxable year, plus
            ``(2) so much of the contributions made by such employer to 
        all such plans with respect to such employee during such 
        taxable year as do not exceed $300.
    ``(b) Limitation.--An individual shall only be taken into account 
as a military spouse under subsection (a) for the taxable year which 
includes the date on which such individual began participating in the 
eligible defined contribution plan of the employer and the 2 succeeding 
taxable years.
    ``(c) Eligible Small Employer.--For purposes of this section, the 
term `eligible small employer' means an eligible employer (as defined 
in section 408(p)(2)(C)(i)(I).
    ``(d) Military Spouse.--For purposes of this section--
            ``(1) In general.--The term `military spouse' means, with 
        respect to any employer, any individual who is married (within 
        the meaning of section 7703 as of the first date that the 
        employee is employed by the employer) to an individual who is a 
        member of the uniformed services (as defined section 101(a)(5) 
        of title 10, United States Code). For purposes of this section, 
        an employer may rely on an employee's certification that such 
        employee's spouse is a member of the uniformed services if such 
        certification provides the name, rank, and service branch of 
        such spouse.
            ``(2) Exclusion of highly compensated employees.--With 
        respect to any employer, the term `military spouse' shall not 
        include any individual if such individual is a highly 
        compensated employee of such employer (within the meaning of 
        section 414(q)).
    ``(e) Eligible Defined Contribution Plan.--For purposes of this 
section, the term `eligible defined contribution plan' means, with 
respect to any eligible small employer, any defined contribution plan 
(as defined in section 414(i)) of such employer if, under the terms of 
such plan--
            ``(1) military spouses employed by such employer are 
        eligible to participate in such plan not later than the date 
        which is 2 months after the date on which such individual 
        begins employment with such employer, and
            ``(2) military spouses who are eligible to participate in 
        such plan--
                    ``(A) are immediately eligible to receive an amount 
                of employer contributions under such plan which is not 
                less the amount of such contributions that a similarly 
                situated participant who is not a military spouse would 
                be eligible to receive under such plan after 2 years of 
                service, and
                    ``(B) immediately have a nonforfeitable right to 
                the employee's accrued benefit derived from employer 
                contributions under such plan.
    ``(f) Aggregation Rule.--All persons treated as a single employer 
under subsection (b), (c), (m), or (o) of section 414 shall be treated 
as one employer for purposes of this section.''.
    (b) Credit Allowed as Part of General Business Credit.--Section 
38(b) is amended by striking ``plus'' at the end of paragraph (32), by 
striking the period at the end of paragraph (33) and inserting ``, 
plus'', and by adding at the end the following new paragraph:
            ``(34) in the case of an eligible small employer (as 
        defined in section 45U(c)), the military spouse retirement plan 
        eligibility credit determined under section 45U(a).''.
    (c) Specified Credit for Purposes of Certified Professional 
Employer Organizations.--Section 3511(d)(2) is amended by redesignating 
subparagraphs (F), (G), and (H) as subparagraphs (G), (H), and (I), 
respectively, and by inserting after subparagraph (E) the following new 
subparagraph:
                    ``(F) section 45U (military spouse retirement plan 
                eligibility credit),''.
    (d) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 is amended by adding at the end 
the following new item:

``Sec. 45U. Military spouse retirement plan eligibility credit for 
                            small employers.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 302. 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 paragraph (10) of section 
72(t) is amended by striking ``in governmental 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. 303. 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 RESPONDER 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 `qualified first responder retirement 
payments' means, with respect 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
            ``(2) in connection with such individual's qualified first 
        responder service.
    ``(c) Annualized Excludable Disability Amount.--For purposes of 
this section--
            ``(1) In general.--The term `annualized excludable 
        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 disability amount.--The 
        term `service-connected excludable 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 attains 
                retirement age.
            ``(3) Special rule for partial-year payments.--In the case 
        of an individual who only receives service-connected excludable 
        disability amounts properly attributable to a portion of the 
        12-month period described in paragraph (1), such paragraph 
        shall 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, firefighter, paramedic, or emergency medical 
technician.''.
    (b) Clerical Amendment.--The table of sections for part III of 
subchapter B of chapter 1 is amended by inserting 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 taxable years beginning after 
the date of the enactment of this Act.

SEC. 304. REPEAL OF DIRECT PAYMENT REQUIREMENT ON EXCLUSION FROM GROSS 
              INCOME OF DISTRIBUTIONS FROM GOVERNMENTAL PLANS FOR 
              HEALTH AND LONG-TERM CARE INSURANCE.

    (a) In General.--Section 402(l)(5)(A) is amended to read as 
follows:
                    ``(A) Direct payment to insurer permitted.--
                            ``(i) In general.--Paragraph (1) shall 
                        apply to a distribution without regard to 
                        whether payment of the premiums is made 
                        directly to the provider of the accident or 
                        health plan or qualified long-term care 
                        insurance contract by deduction from a 
                        distribution from the eligible retirement plan, 
                        or is made to the employee.
                            ``(ii) Reporting.--In the case of a payment 
                        made to the employee as described in clause 
                        (i), the employee shall include with the return 
                        of tax for the taxable year in which the 
                        distribution is made an attestation that the 
                        distribution does not exceed the amount paid by 
                        the employee for qualified health insurance 
                        premiums for such taxable year.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to distributions made after the date of the enactment of this Act.

SEC. 305. MODIFICATION OF ELIGIBLE AGE FOR EXEMPTION FROM EARLY 
              WITHDRAWAL PENALTY.

    (a) In General.--Subparagraph (A) of section 72(t)(10), as amended 
by this Act, is further amended by striking ``age 50'' and inserting 
``age 50 or 25 years of service under the plan, whichever is earlier''.
    (b) Effective Date.--The amendment made by this section shall apply 
to distributions made after the date of the enactment of this Act.

SEC. 306. EXEMPTION FROM EARLY WITHDRAWAL PENALTY FOR CERTAIN STATE AND 
              LOCAL GOVERNMENT CORRECTIONS EMPLOYEES.

    (a) In General.--Clause (i) of section 72(t)(10)(B) is amended by 
striking ``or emergency medical services'' and inserting ``emergency 
medical services, or services as a corrections officer or as a forensic 
security employee providing for the care, custody, and control of 
forensic patients''.
    (b) Effective Date.--The amendment made by this section shall apply 
to distributions made after the date of the enactment of this Act.

                   TITLE IV--NONPROFITS AND EDUCATORS

SEC. 401. ENHANCEMENT OF 403(B) PLANS.

    (a) Permitted Investments.--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 Revenue Service 
Revenue Ruling 81-100 (or any successor guidance)''.
    (b) Conforming Amendment.--The heading of paragraph (7) of section 
403(b) is amended by striking ``for regulated investment company 
stock''.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts invested after the date of the enactment of this Act.

SEC. 402. HARDSHIP WITHDRAWAL RULES FOR 403(B) PLANS.

    (a) In General.--Section 403(b) is amended by adding at the end the 
following new paragraph:
            ``(15) Special rules relating to hardship withdrawals.--For 
        purposes of paragraphs (7) and (11)--
                    ``(A) Amounts which may be withdrawn.--The 
                following amounts may be distributed upon hardship of 
                the employee:
                            ``(i) Contributions made pursuant to a 
                        salary reduction agreement (within the meaning 
                        of section 3121(a)(5)(D)).
                            ``(ii) Qualified nonelective contributions 
                        (as defined in section 401(m)(4)(C)).
                            ``(iii) Qualified matching contributions 
                        described in section 401(k)(3)(D)(ii)(I).
                            ``(iv) Earnings on any contributions 
                        described in clause (i), (ii), or (iii).
                    ``(B) No requirement to take available loan.--A 
                distribution shall not be treated as failing to be made 
                upon the hardship of an employee solely because the 
                employee does not take any available loan under the 
                plan.''.
    (b) Conforming Amendments.--
            (1) Section 403(b)(7)(A)(i)(V) is amended by striking ``in 
        the case of contributions made pursuant to a salary reduction 
        agreement (within the meaning of section 3121(a)(5)(D))'' and 
        inserting ``subject to the provisions of paragraph (15)''.
            (2) Paragraph (11) of section 403(b), as amended by this 
        Act, is further amended--
                    (A) by striking ``in'' in subparagraph (B) and 
                inserting ``subject to the provisions of paragraph 
                (15), in''; and
                    (B) by striking the last sentence.
    (c) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after the date of the enactment of this 
Act.

SEC. 403. MULTIPLE EMPLOYER 403(B) PLANS.

    (a) In General.--Section 403(b), as amended by this Act, is further 
amended by adding at the end the following new paragraph:
            ``(16) Multiple employer plans.--
                    ``(A) In general.--Except in the case of a church 
                plan, this subsection shall not be treated as failing 
                to apply to an annuity contract solely by reason of 
                such contract being purchased under a plan maintained 
                by more than 1 employer.
                    ``(B) Treatment of employers failing to meet 
                requirements of plan.--
                            ``(i) In general.--In the case of a plan 
                        maintained by more than 1 employer, this 
                        subsection shall not be treated as failing to 
                        apply to an annuity contract held under such 
                        plan merely because of one or more employers 
                        failing to meet the requirements of this 
                        subsection if such plan satisfies rules similar 
                        to the rules of section 413(e)(2) with respect 
                        to any such employer failure.
                            ``(ii) Additional requirements in case of 
                        non-governmental plans.--A plan shall not be 
                        treated as meeting the requirements of this 
                        subparagraph unless the plan satisfies rules 
                        similar to the rules of subparagraph (A) or (B) 
                        of section 413(e)(1), except in the case of a 
                        multiple employer plan maintained solely by any 
                        of the following: A State, a political 
                        subdivision of a State, or an agency or 
                        instrumentality of any one or more of the 
                        foregoing.''.
    (b) Annual Registration for 403(b) Multiple Employer Plan.--Section 
6057 is amended by redesignating subsection (g) as subsection (h) and 
by inserting after subsection (f) the following new subsection:
    ``(g) 403(b) Multiple Employer Plans Treated as One Plan.--In the 
case of annuity contracts to which this section applies and to which 
section 403(b) applies by reason of the plan under which such contracts 
are purchased meeting the requirements of paragraph (16) thereof, such 
plan shall be treated as a single plan for purposes of this section.''.
    (c) Annual Information Returns for 403(b) Multiple Employer Plan.--
Section 6058 is amended by redesignating subsection (f) as subsection 
(g) and by inserting after subsection (e) the following new subsection:
    ``(f) 403(b) Multiple Employer Plans Treated as One Plan.--In the 
case of annuity contracts to which this section applies and to which 
section 403(b) applies by reason of the plan under which such contracts 
are purchased meeting the requirements of paragraph (16) thereof, such 
plan shall be treated as a single plan for purposes of this section.''.
    (d) Regulations.--The Secretary of the Treasury (or the Secretary's 
delegate) shall prescribe such regulations as may be necessary to 
clarify, in the case of plans to which section 403(b)(16) of the 
Internal Revenue Code of 1986 applies, the treatment of an employer 
departing such plan in connection with such employer's failure to meet 
multiple employer plan requirements.
    (e) Modification of Model Plan Language. etc.--
            (1) Plan notifications.--The Secretary of the Treasury (or 
        the Secretary's delegate) shall modify the model plan language 
        published under section 413(e)(5) of the Internal Revenue Code 
        of 1986 to include language which notifies participating 
        employers described in section 501(c)(3), and which are exempt 
        from tax under section 501(a), that the plan is subject to the 
        Employee Retirement Income Security Act of 1974 and that such 
        employer is a plan sponsor with respect to its employees 
        participating in the multiple employer plan and, as such, has 
        certain fiduciary duties with respect to the plan and to its 
        employees.
            (2) Model plans for multiple employer 403(b) non-
        governmental plans.--For plans to which section 403(b)(16)(A) 
        of the Internal Revenue Code of 1986 applies (other than a plan 
        maintained for its employees by a State, a political 
        subdivision of a State, or an agency or instrumentality of any 
        one or more of the foregoing) the Secretary of the Treasury (or 
        the Secretary's delegate) shall publish model plan language 
        similar to model plan language published under section 
        413(e)(5) of such Code.
            (3) Educational outreach to employers exempt from tax.--The 
        Secretary of the Treasury (or the Secretary's delegate) shall 
        provide education and outreach to increase awareness to 
        employers described in section 501(c)(3), and which are exempt 
        from tax under section 501(a), that multiple employer plans are 
        subject to the Employee Retirement Income Security Act of 1974 
        and that such employer is a plan sponsor with respect to its 
        employees participating in the multiple employer plan and, as 
        such, has certain fiduciary duties with respect to the plan and 
        to its employees.
    (f) No Inference With Respect to Church Plans.--Regarding any 
application of section 403(b) of the Internal Revenue Code of 1986 to 
an annuity contract purchased under a church plan (as defined in 
section 414(e) of such Code) maintained by more than 1 employer, or to 
any application of rules similar to section 413(e) of such Code to such 
a plan, no inference shall be made from section 403(b)(16)(A) of such 
Code (as added by this Act) not applying to such plans.
    (g) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to plan years beginning after the date of the enactment 
        of this Act.
            (2) Rule of construction.--Nothing in the amendments made 
        by subsection (a) shall be construed as limiting the authority 
        of the Secretary of the Treasury or the Secretary's delegate 
        (determined without regard to such amendment) to provide for 
        the proper treatment of a failure to meet any requirement 
        applicable under the Internal Revenue Code of 1986 with respect 
        to one employer (and its employees) in the case of a plan to 
        which section 403(b)(16) of such Code applies.

                        TITLE V--DISASTER RELIEF

SEC. 501. SPECIAL RULES FOR USE OF RETIREMENT FUNDS IN CONNECTION WITH 
              QUALIFIED FEDERALLY DECLARED DISASTERS.

    (a) Tax-Favored Withdrawals From Retirement Plans.--
            (1) In general.--Paragraph (2) of section 72(t), as amended 
        by this Act, is further amended by adding at the end the 
        following new subparagraph:
                    ``(M) Distributions from retirement plans in 
                connection with federally declared disasters.--Any 
                qualified disaster recovery distribution.''.
            (2) Qualified disaster recovery distribution.--Section 
        72(t) is amended by adding at the end the following new 
        paragraph:
            ``(11) Qualified disaster recovery distribution.--For 
        purposes of paragraph (2)(M)--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the term `qualified disaster recovery 
                distribution' means any distribution made--
                            ``(i) on or after the first day of the 
                        incident period of a qualified disaster and 
                        before the date that is 180 days after the 
                        applicable date with respect to such disaster, 
                        and
                            ``(ii) to an individual whose principal 
                        place of abode at any time during the incident 
                        period of such qualified disaster is located in 
                        the qualified disaster area with respect to 
                        such qualified disaster and who has sustained 
                        an economic loss by reason of such qualified 
                        disaster.
                    ``(B) Aggregate dollar limitation.--
                            ``(i) In general.--For purposes of this 
                        subsection, the aggregate amount of 
                        distributions received by an individual which 
                        may be treated as qualified disaster recovery 
                        distributions with respect to any qualified 
                        disaster in all taxable years shall not exceed 
                        $22,000.
                            ``(ii) Treatment of plan distributions.--If 
                        a distribution to an individual would (without 
                        regard to clause (i)) be a qualified disaster 
                        recovery distribution, a plan shall not be 
                        treated as violating any requirement of this 
                        title merely because the plan treats such 
                        distribution as a qualified disaster recovery 
                        distribution, unless the aggregate amount of 
                        such distributions from all plans maintained by 
                        the employer (and any member of any controlled 
                        group which includes the employer) to such 
                        individual exceeds $22,000 with respect to the 
                        same qualified disaster.
                            ``(iii) Controlled group.--For purposes of 
                        clause (ii), the term `controlled group' means 
                        any group treated as a single employer under 
                        subsection (b), (c), (m), or (o) of section 
                        414.
                    ``(C) Amount distributed may be repaid.--
                            ``(i) In general.--Any individual who 
                        receives a qualified disaster recovery 
                        distribution may, at any time during the 3-year 
                        period beginning on the day after the date on 
                        which such distribution was received, make one 
                        or more contributions in an aggregate amount 
                        not to exceed the amount of such distribution 
                        to an eligible retirement plan of which such 
                        individual is a beneficiary and to which a 
                        rollover contribution of such distribution 
                        could be made under section 402(c), 403(a)(4), 
                        403(b)(8), 408(d)(3), or 457(e)(16), as the 
                        case may be.
                            ``(ii) Treatment of repayments of 
                        distributions from eligible retirement plans 
                        other than iras.--For purposes of this title, 
                        if a contribution is made pursuant to clause 
                        (i) with respect to a qualified disaster 
                        recovery distribution from a plan other than an 
                        individual retirement plan, then the taxpayer 
                        shall, to the extent of the amount of the 
                        contribution, be treated as having received the 
                        qualified disaster recovery distribution in an 
                        eligible rollover distribution (as defined in 
                        section 402(c)(4)) and as having transferred 
                        the amount to the eligible retirement plan in a 
                        direct trustee to trustee transfer within 60 
                        days of the distribution.
                            ``(iii) Treatment of repayments for 
                        distributions from iras.--For purposes of this 
                        title, if a contribution is made pursuant to 
                        clause (i) with respect to a qualified disaster 
                        recovery distribution from an individual 
                        retirement plan, then, to the extent of the 
                        amount of the contribution, the qualified 
                        disaster recovery distribution shall be treated 
                        as a distribution described in section 
                        408(d)(3) and as having been transferred to the 
                        eligible retirement plan in a direct trustee to 
                        trustee transfer within 60 days of the 
                        distribution.
                    ``(D) Income inclusion spread over 3-year period.--
                            ``(i) In general.--In the case of any 
                        qualified disaster recovery distribution, 
                        unless the taxpayer elects not to have this 
                        subparagraph apply for any taxable year, any 
                        amount required to be included in gross income 
                        for such taxable year shall be so included 
                        ratably over the 3-taxable year period 
                        beginning with such taxable year.
                            ``(ii) Special rule.--For purposes of 
                        clause (i), rules similar to the rules of 
                        subparagraph (E) of section 408A(d)(3) shall 
                        apply.
                    ``(E) Qualified disaster.--For purposes of this 
                paragraph and paragraph (8), the term `qualified 
                disaster' means any disaster with respect to which a 
                major disaster has been declared by the President under 
                section 401 of the Robert T. Stafford Disaster Relief 
                and Emergency Assistance Act after December 27, 2020.
                    ``(F) Other definitions.--For purposes of this 
                paragraph and paragraph (8)--
                            ``(i) Qualified disaster area.--
                                    ``(I) In general.--The term 
                                `qualified disaster area' means, with 
                                respect to any qualified disaster, the 
                                area with respect to which the major 
                                disaster was declared under the Robert 
                                T. Stafford Disaster Relief and 
                                Emergency Assistance Act.
                                    ``(II) Exceptions.--Such term shall 
                                not include any area which is a 
                                qualified disaster area solely by 
                                reason of section 301 of the Taxpayer 
                                Certainty and Disaster Tax Relief Act 
                                of 2020.
                            ``(ii) Incident period.--The term `incident 
                        period' means, with respect to any qualified 
                        disaster, the period specified by the Federal 
                        Emergency Management Agency as the period 
                        during which such disaster occurred.
                            ``(iii) Applicable date.--The term 
                        `applicable date' means the latest of--
                                    ``(I) the date of the enactment of 
                                this paragraph,
                                    ``(II) the first day of the 
                                incident period with respect to the 
                                qualified disaster, or
                                    ``(III) the date of the disaster 
                                declaration with respect to the 
                                qualified disaster.
                            ``(iv) Eligible retirement plan.--The term 
                        `eligible retirement plan' shall have the 
                        meaning given such term by section 
                        402(c)(8)(B).
                    ``(G) Special rules.--
                            ``(i) Exemption of distributions from 
                        trustee to trustee transfer and withholding 
                        rules.--For purposes of sections 401(a)(31), 
                        402(f), and 3405, qualified disaster recovery 
                        distributions shall not be treated as eligible 
                        rollover distributions.
                            ``(ii) Qualified disaster recovery 
                        distributions treated as meeting plan 
                        distribution requirements.--For purposes of 
                        this title--
                                    ``(I) a qualified disaster recovery 
                                distribution shall be treated as 
                                meeting the requirements of sections 
                                401(k)(2)(B)(i), 403(b)(7)(A)(i), 
                                403(b)(11), and 457(d)(1)(A), and
                                    ``(II) in the case of a money 
                                purchase pension plan, a qualified 
                                disaster recovery distribution which is 
                                an in-service withdrawal shall be 
                                treated as meeting the requirements of 
                                section 401(a) applicable to 
                                distributions.''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to distributions with respect to disasters the 
        incident period (as defined in section 72(t)(11)(F)(ii) of the 
        Internal Revenue Code of 1986, as added by this subsection) for 
        which begins on or after the date which is 30 days after the 
        date of the enactment of the Taxpayer Certainty and Disaster 
        Tax Relief Act of 2020.
    (b) Recontributions of Withdrawals for Home Purchases.--
            (1) Individual retirement plans.--Paragraph (8) of section 
        72(t) is amended by adding at the end the following new 
        subparagraph:
                    ``(F) Recontributions.--
                            ``(i) General rule.--
                                    ``(I) In general.--Any individual 
                                who received a qualified distribution 
                                may, during the applicable period, make 
                                one or more contributions in an 
                                aggregate amount not to exceed the 
                                amount of such qualified distribution 
                                to an eligible retirement plan (as 
                                defined in section 402(c)(8)(B)) of 
                                which such individual is a beneficiary 
                                and to which a rollover contribution of 
                                such distribution could be made under 
                                section 402(c), 403(a)(4), 403(b)(8), 
                                or 408(d)(3), as the case may be.
                                    ``(II) Treatment of repayments.--
                                Rules similar to the rules of clauses 
                                (ii) and (iii) of paragraph (11)(C) 
                                shall apply for purposes of this 
                                subsection.
                            ``(ii) Qualified distribution.--For 
                        purposes of this subparagraph, the term 
                        `qualified distribution' means any 
                        distribution--
                                    ``(I) which is a qualified first-
                                time homebuyer distribution,
                                    ``(II) which was to be used to 
                                purchase or construct a principal 
                                residence in a qualified disaster area, 
                                but which was not so used on account of 
                                the qualified disaster with respect to 
                                such area, and
                                    ``(III) which was received during 
                                the period beginning on the date which 
                                is 180 days before the first day of the 
                                incident period of such qualified 
                                disaster and ending on the date which 
                                is 30 days after the last day of such 
                                incident period.
                            ``(iii) Applicable period.--For purposes of 
                        this subparagraph, the term `applicable period' 
                        means, in the case of a principal residence in 
                        a qualified disaster area with respect to any 
                        qualified disaster, the period beginning on the 
                        first day of the incident period of such 
                        qualified disaster and ending on the date which 
                        is 180 days after the applicable date with 
                        respect to such disaster.''.
            (2) Qualified plans.--Subsection (c) of section 402, as 
        amended by this Act, is further amended by adding at the end 
        the following new paragraph:
            ``(13) Recontributions of withdrawals for home purchases.--
                    ``(A) General rule.--
                            ``(i) In general.--Any individual who 
                        received a qualified distribution may, during 
                        the applicable period, make one or more 
                        contributions in an aggregate amount not to 
                        exceed the amount of such qualified 
                        distribution to an eligible retirement plan (as 
                        defined in paragraph (8)(B)) of which such 
                        individual is a beneficiary and to which a 
                        rollover contribution of such distribution 
                        could be made under subsection (c) or section 
                        403(a)(4), 403(b)(8), or 408(d)(3), as the case 
                        may be.
                            ``(ii) Treatment of repayments.--Rules 
                        similar to the rules of clauses (ii) and (iii) 
                        of section 72(t)(11)(C) shall apply for 
                        purposes of this subsection.
                    ``(B) Qualified distribution.--For purposes of this 
                paragraph, the term `qualified distribution' means any 
                distribution--
                            ``(i) described in section 
                        401(k)(2)(B)(i)(IV), 403(b)(7)(A)(i)(V), or 
                        403(b)(11)(B),
                            ``(ii) which was to be used to purchase or 
                        construct a principal residence in a qualified 
                        disaster area, but which was not so used on 
                        account of the qualified disaster with respect 
                        to such area, and
                            ``(iii) which was received during the 
                        period beginning on the date which is 180 days 
                        before the first day of the incident period of 
                        such qualified disaster and ending on the date 
                        which is 30 days after the last day of such 
                        incident period.
                    ``(C) Definitions.--For purposes of this 
                paragraph--
                            ``(i) the terms `qualified disaster', 
                        `qualified disaster area', and `incident 
                        period' have the meaning given such terms under 
                        section 72(t)(11), and
                            ``(ii) the term `applicable period' has the 
                        meaning given such term under section 
                        72(t)(8)(F).''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to recontributions of withdrawals for home 
        purchases with respect to disasters the incident period (as 
        defined in section 72(t)(11)(F)(ii) of the Internal Revenue 
        Code of 1986, as added by this subsection) for which begins on 
        or after the date which is 30 days after the date of the 
        enactment of the Taxpayer Certainty and Disaster Tax Relief Act 
        of 2020.
    (c) Loans From Qualified Plans.--
            (1) In general.--Subsection (p) of section 72 is amended by 
        adding at the end the following new paragraph:
            ``(6) Increase in limit on loans not treated as 
        distributions.--
                    ``(A) In general.--In the case of any loan from a 
                qualified employer plan to a qualified individual made 
                during the applicable period--
                            ``(i) clause (i) of paragraph (2)(A) shall 
                        be applied by substituting `$100,000' for 
                        `$50,000', and
                            ``(ii) clause (ii) of such paragraph shall 
                        be applied by substituting `the present value 
                        of the nonforfeitable accrued benefit of the 
                        employee under the plan' for `one-half of the 
                        present value of the nonforfeitable accrued 
                        benefit of the employee under the plan'.
                    ``(B) Delay of repayment.--In the case of a 
                qualified individual with respect to any qualified 
                disaster with an outstanding loan from a qualified 
                employer plan on or after the applicable date with 
                respect to the qualified disaster--
                            ``(i) if the due date pursuant to 
                        subparagraph (B) or (C) of paragraph (2) for 
                        any repayment with respect to such loan occurs 
                        during the period beginning on the first day of 
                        the incident period of such qualified disaster 
                        and ending on the date which is 180 days after 
                        the last day of such incident period, such due 
                        date may be delayed for 1 year,
                            ``(ii) any subsequent repayments with 
                        respect to any such loan may be appropriately 
                        adjusted to reflect the delay in the due date 
                        under clause (i) and any interest accruing 
                        during such delay, and
                            ``(iii) in determining the 5-year period 
                        and the term of a loan under subparagraph (B) 
                        or (C) of paragraph (2), the period described 
                        in clause (i) may be disregarded.
                    ``(C) Definitions.--For purposes of this 
                paragraph--
                            ``(i) Qualified individual.--The term 
                        `qualified individual' means any individual--
                                    ``(I) whose principal place of 
                                abode at any time during the incident 
                                period of any qualified disaster is 
                                located in the qualified disaster area 
                                with respect to such qualified 
                                disaster, and
                                    ``(II) who has sustained an 
                                economic loss by reason of such 
                                qualified disaster.
                            ``(ii) Applicable period.--The applicable 
                        period with respect to any disaster is the 
                        period--
                                    ``(I) beginning on the applicable 
                                date with respect to such disaster, and
                                    ``(II) ending on the date that is 
                                180 days after such applicable date.
                            ``(iii) Other terms.--For purposes of this 
                        paragraph--
                                    ``(I) the terms `applicable date', 
                                `qualified disaster', `qualified 
                                disaster area', and `incident period' 
                                have the meaning given such terms under 
                                subsection (t)(11), and
                                    ``(II) the term `applicable period' 
                                has the meaning given such term under 
                                subsection (t)(8).''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall apply to plan loans made with respect to disasters the 
        incident period (as defined in section 72(t)(11)(F)(ii) of the 
        Internal Revenue Code of 1986, as added by this subsection) for 
        which begins on or after the date which is 30 days after the 
        date of the enactment of the Taxpayer Certainty and Disaster 
        Tax Relief Act of 2020.
    (d) GAO Report.--The Comptroller General of the United States shall 
submit a report to the Committees on Finance and Health, Education, 
Labor and Pensions of the Senate and the Committees on Ways and Means 
and Education and Labor of the House of Representatives on taxpayer 
utilization of the retirement disaster relief permitted by the 
amendments made by this section and or permitted by prior legislation, 
including a comparison of utilization by higher and lower income 
taxpayers and whether the $22,000 threshold on distributions provides 
adequate relief for taxpayers who suffer from a disaster.

                        TITLE VI--EMPLOYER PLANS

SEC. 601. CREDIT FOR EMPLOYERS WITH RESPECT TO MODIFIED SAFE HARBOR 
              REQUIREMENTS.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1, 
as amended by this Act, is further amended by adding at the end the 
following new section:

``SEC. 45V. CREDIT FOR SMALL EMPLOYERS WITH RESPECT TO MODIFIED SAFE 
              HARBOR REQUIREMENTS FOR AUTOMATIC CONTRIBUTION 
              ARRANGEMENTS.

    ``(a) General Rule.--For purposes of section 38, in the case of a 
small employer, the safe harbor adoption credit determined under this 
section for any taxable year is the amount equal to the total of the 
employer's matching contributions under section 401(k)(16)(D) during 
the taxable year on behalf of employees who are not highly compensated 
employees.
    ``(b) Limitations.--
            ``(1) Limitation with respect to compensation.--The credit 
        determined under subsection (a) with respect to contributions 
        made on behalf of any employee shall not exceed 2 percent of 
        the compensation of such employee for the taxable year.
            ``(2) Limitation with respect to years of participation.--A 
        credit shall be determined under subsection (a) with respect to 
        contributions made on behalf of any employee only during the 
        first 5 years such employee participates in the secure deferral 
        arrangement.
    ``(c) Definitions.--
            ``(1) In general.--Any term used in this section which is 
        also used in section 401(k)(16) shall have the same meaning as 
        when used in such section.
            ``(2) Small employer.--The term `small employer' means an 
        eligible employer (as defined in section 408(p)(2)(C)(i)).
    ``(d) Special Rules.--
            ``(1) Aggregation rules.--For purposes of this section, all 
        persons treated as a single employer under subsection (a) or 
        (b) of section 52, or subsection (m) or (o) of section 414, 
        shall be treated as one person and all plans of the employer 
        shall be treated as 1 eligible plan.
            ``(2) Denial of double benefit.--No deduction shall be 
        allowable under this title for any contribution with respect to 
        which a credit is allowed under this section.
            ``(3) Election not to claim credit.--This section shall not 
        apply to a taxpayer for any taxable year if such taxpayer 
        elects to have this section not apply for such taxable year.''.
    (b) Credit to Be Part of General Business Credit.--Subsection (b) 
of section 38, as amended by this Act, is further amended by striking 
``plus'' at the end of paragraph (33), by striking the period at the 
end of paragraph (34) and inserting ``, plus'', and by adding at the 
end the following new paragraph:
            ``(35) the safe harbor adoption credit determined under 
        section 45V.''.
    (c) Treatment of Credit for Certified Professional Employer 
Organizations.--Paragraph (2) of section 3511(d), as amended by this 
Act, is further amended--
            (1) by redesignating subparagraphs (G), (H), and (I) as 
        subparagraphs (H), (I), and (J), respectively, and
            (2) by inserting after subparagraph (F) the following new 
        subparagraph:
                    ``(G) section 45V (safe harbor adoption credit),''.
    (d) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1, as amended by this Act, is 
further amended by inserting after the item relating to section 45U the 
following new item:

``Sec. 45V. Credit for small employers with respect to modified safe 
                            harbor requirements for automatic 
                            contribution arrangements.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years which include any portion of a plan year 
beginning after December 31, 2023.

SEC. 602. APPLICATION OF TOP HEAVY RULES TO DEFINED CONTRIBUTION PLANS 
              COVERING EXCLUDABLE EMPLOYEES.

    (a) In General.--Paragraph (2) of section 416(c) is amended by 
adding at the end the following new subparagraph:
                    ``(C) Application to employees not meeting age and 
                service requirements.--Any employees not meeting the 
                age or service requirements of section 410(a)(1) 
                (without regard to subparagraph (B) thereof) may be 
                excluded from consideration in determining whether any 
                plan of the employer meets the requirements of 
                subparagraphs (A) and (B).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to plan years beginning after the date of the enactment of this 
Act.

SEC. 603. INCREASE IN CREDIT LIMITATION FOR SMALL EMPLOYER PENSION PLAN 
              STARTUP COSTS OF CERTAIN EMPLOYERS.

    (a) In General.--Subsection (a) of section 45E is amended by 
inserting before the period at the end the following: ``(75 percent of 
such costs in the case of an eligible employer, as determined by 
substituting `25' for `100' in section 408(p)(2)(C)(i))''.
    (b) Treatment of Credit for Certified Professional Employer 
Organizations.--Paragraph (2) of section 3511(d), as amended by this 
Act, is further amended--
            (1) by redesignating subparagraphs (E), (F), (G), (H), (I), 
        and (J) as subparagraphs (F), (G), (H), (I), (J), and (K), 
        respectively, and
            (2) by inserting after subparagraph (D) the following new 
        subparagraph:
                    ``(E) section 45E (small employer pension plan 
                startup cost credit),''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2023.

SEC. 604. EXPANSION OF EMPLOYEE PLANS COMPLIANCE RESOLUTION SYSTEM.

    (a) In General.--Except as otherwise provided in guidance 
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 the Internal Revenue Code 
of 1986 may be self-corrected under the Employee Plans Compliance 
Resolution System (as described in Revenue Procedure 2021-30 or any 
successor guidance, and hereafter referred to in this section as the 
``EPCRS''), except to the extent that such failure was identified by 
the Secretary prior to any actions which demonstrate a commitment to 
implement a self-correction. Revenue Procedure 2021-30 is deemed 
amended as of the date of the enactment of this Act to provide that, 
except as otherwise provided under such Code or other guidance 
prescribed by the Secretary, the correction period under section 9.02 
of such Revenue Procedure (or any successor guidance) for an eligible 
inadvertent failure is indefinite and has no last day, other than with 
respect to failures identified by the Secretary prior to any self-
correction as described in the preceding sentence.
    (b) Loan Errors.--In the case of an eligible inadvertent failure 
relating to a loan from a plan to a participant, such failure may be 
self-corrected under subsection (a) according to the rules of section 
6.07 of Revenue Procedure 2021-30 (or any successor guidance), 
including the provisions related to whether a deemed distribution must 
be reported on Form 1099-R.
    (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 failures with respect to individual retirement plans (as so 
defined), including--
            (1) waivers of the excise tax which would otherwise apply 
        under section 4974 of the Internal Revenue Code of 1986; and
            (2) rules permitting a nonspouse beneficiary to return 
        distributions to an inherited individual retirement plan 
        described in section 408(d)(3)(C) of the Internal Revenue Code 
        of 1986 in a case where, due to an inadvertent error by a 
        service provider, the beneficiary 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 Inadvertent 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 paragraph (2), the 
        term ``eligible inadvertent failure'' means a failure that 
        occurs despite the existence of practices and procedures 
        which--
                    (A) satisfy the standards set forth in section 4.04 
                of Revenue Procedure 2021-30 (or any successor 
                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 egregious, relates to 
        the diversion or misuse of plan assets, or is directly or 
        indirectly related to an abusive tax avoidance transaction.
    (f) Deadline.--Any guidance, or revision to any such guidance, 
required by this section shall be promulgated not later than the date 
which is 2 years after the date of the enactment of this Act.

SEC. 605. APPLICATION OF CREDIT FOR SMALL EMPLOYER PENSION PLAN STARTUP 
              COSTS TO EMPLOYERS WHICH JOIN AN EXISTING PLAN.

    (a) In General.--Section 45E(d)(3)(A) is amended by striking 
``effective'' and inserting ``effective with respect to the eligible 
employer''.
    (b) Effective Date.--The amendment made by this section shall apply 
to eligible employer plans which become effective with respect to the 
eligible employer after the date of the enactment of this Act.

SEC. 606. SAFE HARBOR FOR CORRECTIONS OF EMPLOYEE ELECTIVE DEFERRAL 
              FAILURES.

    The Secretary of the Treasury shall modify Appendix A.05(8) of 
Revenue Procedure 2021-30 (the Employee Plans Compliance Resolution 
System, or EPCRS) not later than December 31, 2023--
            (1) to provide that the special safe harbor correction 
        method provided in Appendix A.05(8) for failures related to 
        automatic contribution features in a section 401(k) plan or a 
        section 403(b) plan is not limited to failures that begin on or 
        before December 31, 2023, and
            (2) to clarify that EPCRS correction methods for failures 
        related to automatic contribution features that require notices 
        to a participant can be satisfied without regard to whether the 
        participant remains employed at the time corrections are made.

SEC. 607. REFORM OF FAMILY ATTRIBUTION RULE.

    (a) In General.--Section 414 is amended--
            (1) in subsection (b)--
                    (A) by striking ``For purposes of'' and inserting 
                the following:
            ``(1) In general.--For purposes of'', and
                    (B) by adding at the end the following new 
                paragraphs:
            ``(2) Special rules for applying family attribution.--For 
        purposes of applying the attribution rules under section 1563 
        with respect to paragraph (1), the following rules apply:
                    ``(A) Community property laws shall be disregarded 
                for purposes of determining ownership.
                    ``(B) Except as provided by the Secretary, stock of 
                an individual not attributed under section 1563(e)(5) 
                to such individual's spouse shall not be attributed to 
                such spouse by reason of the combined application of 
                paragraphs (1) and (6)(A) of section 1563(e).
                    ``(C) Except as provided by the Secretary, in the 
                case of stock in different corporations that is 
                attributed to a child under section 1563(e)(6)(A) from 
                each parent, and is not attributed to such parents as 
                spouses under section 1563(e)(5), such attribution to 
                the child shall not by itself result in such 
                corporations being members of the same controlled 
                group.
            ``(3) Plan shall not fail to be treated as satisfying this 
        section.--If application of paragraph (2) causes 2 or more 
        entities to be a controlled group or to no longer be in a 
        controlled group, such change shall be treated as a transaction 
        to which section 410(b)(6)(C) applies.'', and
            (2) in subsection (m)(6)(B)--
                    (A) by striking ``Ownership.--In determining'' and 
                inserting the following: ``Ownership.--
                            ``(i) In general.--In determining'',
                    (B) by adding at the end the following new clauses:
                            ``(ii) Special rules for applying family 
                        attribution.--For purposes of applying the 
                        attribution rules under section 318 with 
                        respect to clause (i), the following rules 
                        apply:
                                    ``(I) Community property laws shall 
                                be disregarded for purposes of 
                                determining ownership.
                                    ``(II) Except as provided by the 
                                Secretary, stock of an individual not 
                                attributed under section 
                                318(a)(1)(A)(i) to such individual's 
                                spouse shall not be attributed by 
                                reason of the combined application of 
                                paragraphs (1)(A)(ii) and (4) of 
                                section 318(a) to such spouse from a 
                                child who has not attained the age of 
                                21 years.
                                    ``(III) Except as provided by the 
                                Secretary, in the case of stock in 
                                different organizations which is 
                                attributed under section 
                                318(a)(1)(A)(ii) from each parent to a 
                                child who has not attained the age of 
                                21 years, and is not attributed to such 
                                parents as spouses under section 
                                318(a)(1)(A)(i), such attribution to 
                                the child shall not by itself result in 
                                such organizations being members of the 
                                same affiliated service group.
                            ``(iii) Plan shall not fail to be treated 
                        as satisfying this section.--If the application 
                        of clause (ii) causes two or more entities to 
                        be an affiliated service group, or to no longer 
                        be in an affiliated service group, such change 
                        shall be treated as a transaction to which 
                        section 410(b)(6)(C) applies.'', and
                    (C) by striking ``apply'' in clause (i), as so 
                added, and inserting ``apply, except that community 
                property laws shall be disregarded for purposes of 
                determining ownership''.
    (b) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after December 31, 2023.

SEC. 608. CONTRIBUTION LIMIT FOR SIMPLE IRAS.

    (a) In General.--Subparagraph (E) of section 408(p)(2) is amended--
            (1) by striking ``amount is'' and all that follows in 
        clause (i) and inserting ``dollar amount is--
                                    ``(I) $16,500 in the case of an 
                                eligible employer described in clause 
                                (iii) which had not more than 25 
                                employees who received at least $5,000 
                                of compensation from the employer for 
                                the preceding year,
                                    ``(II) $16,500 in the case of an 
                                eligible employer described in clause 
                                (iii) which is not described in 
                                subclause (I) and which elects, at such 
                                time and in such manner as prescribed 
                                by the Secretary, the application of 
                                this subclause for the year, and
                                    ``(III) $10,000 in any other 
                                case.'',
            (2) by striking ``adjustment.--In the case of'' in clause 
        (ii) and inserting ``adjustment.--
                                    ``(I) Certain large employers.--In 
                                the case of'',
            (3) by striking ``clause (i)'' in clause (ii) and inserting 
        ``clause (i)(III)'', and
            (4) by adding at the end of clause (ii) the following new 
        subclause:
                                    ``(II) Other employers.--In the 
                                case of a year beginning after December 
                                31, 2024, the Secretary shall adjust 
                                annually the $16,500 amount in 
                                subclauses (I) and (II) of clause (i) 
                                in the manner provided under subclause 
                                (I) of this clause, except that the 
                                base period taken into account shall be 
                                the calendar quarter beginning July 1, 
                                2023.''.
    (b) Catch-up Contributions.--Paragraph (2) of section 414(v) is 
amended--
            (1) in subparagraph (B)--
                    (A) by striking ``the applicable'' in clause (ii) 
                and inserting ``except as provided in clause (iii), the 
                applicable''; and
                    (B) by adding at the end the following new clause:
                            ``(iii) In the case of an applicable 
                        employer plan--
                                    ``(I) which is maintained by an 
                                eligible employer described in section 
                                408(p)(2)(E)(i)(I), or
                                    ``(II) to which an election under 
                                section 408(p)(2)(E)(i)(II) applies for 
                                the year (including a plan described in 
                                section 401(k)(11) which is maintained 
                                by an eligible employer described in 
                                section 408(p)(2)(E)(i)(II) and to 
                                which such election applies by reason 
                                of subparagraphs (B)(i)(I) and (E) of 
                                section 401(k)(11)),
                        the applicable dollar amount is $4,750.'', and
            (2) in subparagraph (C), as amended by this Act, by 
        striking ``and the $2,500 amount in subparagraph (B)(ii)'' and 
        inserting ``, the $2,500 amount in subparagraph (B)(ii), and 
        the $4,750 amount in subparagraph (B)(iii)''.
    (c) Employer Match.--Clause (ii) of section 408(p)(2)(C) is 
amended--
            (1) by striking ``The term'' in subclause (I) and inserting 
        ``Except as provided in subclause (IV), the term'',
            (2) by adding at the end the following new subclause:
                                    ``(IV) Special rule for electing 
                                larger employers.--In the case of an 
                                employer which had more than 25 
                                employees who received at least $5,000 
                                of compensation from the employer for 
                                the preceding year, and which makes the 
                                election under subparagraph (E)(i)(II) 
                                for any year, subclause (I) shall be 
                                applied for such year by substituting 
                                `4 percent' for `3 percent'.'', and
            (3) by striking ``3 percent'' each place it appears in 
        subclauses (II) and (III) and inserting ``the applicable 
        percentage''.
    (d) Increase in Nonelective Employer Contribution for Electing 
Larger Employers.--Subparagraph (B) of section 408(p)(2) is amended by 
adding at the end the following new clause:
                            ``(iii) Special rule for electing larger 
                        employers.--In the case of an employer which 
                        had more than 25 employees who received at 
                        least $5,000 of compensation from the employer 
                        for the preceding year, and which makes the 
                        election under subparagraph (E)(i)(II) for any 
                        year, clause (i) shall be applied for such year 
                        by substituting `3 percent' for `2 percent'.''.
    (e) Transition Rule.--Paragraph (2) of section 408(p), as amended 
by this Act, is further amended by adding at the end the following new 
subparagraph:
                    ``(H) 2-year grace period.--An eligible employer 
                which had not more than 25 employees who received at 
                least $5,000 of compensation from the employer for 1 or 
                more years, and which has more than 25 such employees 
                for any subsequent year, shall be treated for purposes 
                of subparagraph (E)(i) as having 25 such employees for 
                the 2 years following the last year the employer had 
                not more than 25 such employees, and not as having made 
                the election under subparagraph (E)(i)(II) for such 2 
                years. Rules similar to the second sentence of 
                subparagraph (C)(i)(II) shall apply for purposes of 
                this subparagraph.''.
    (f) Amendments Apply Only if Employer Has Not Had Another Plan 
Within 3 Years.--Subparagraph (E) of section 408(p)(2), as amended by 
subsection (a), is further amended by adding at the end the following 
new clause:
                            ``(iii) Employer has not had another plan 
                        within 3 years.--An eligible employer is 
                        described in this clause only if, during the 3-
                        taxable-year period immediately preceding the 
                        1st year the employer maintains the qualified 
                        salary reduction arrangement under this 
                        paragraph, neither the employer nor any member 
                        of any controlled group including the employer 
                        (or any predecessor of either) established or 
                        maintained any plan described in clause (i), 
                        (ii), or (iv) of section 219(g)(5)(A) with 
                        respect to which contributions were made, or 
                        benefits were accrued, for substantially the 
                        same employees as are eligible to participate 
                        in such qualified salary reduction 
                        arrangement.''.
    (g) Conforming Amendments Relating to Simple 401(k)s.--
            (1) Subclause (I) of section 401(k)(11)(B)(i) is amended by 
        inserting ``(after the application of any election under 
        section 408(p)(2)(E)(i)(II))'' before the comma.
            (2) Paragraph (11) of section 401(k) is amended by adding 
        at the end the following new subparagraph:
                    ``(E) Employers electing increased contributions.--
                In the case of an employer which applies an election 
                under section 408(p)(2)(E)(i)(II) for purposes of the 
                contribution requirements of this paragraph under 
                subparagraph (B)(i)(I), rules similar to the rules of 
                subparagraphs (B)(iii), (C)(ii)(IV), and (G) of section 
                408(p)(2) shall apply for purposes of subparagraphs 
                (B)(i)(II) and (B)(ii) of this paragraph.''.
    (h) Plan Forms to Be Shared With Secretary.--
            (1) In general.--Subsection (p) of section 408 is amended 
        by adding at the end the following new paragraph:
            ``(11) Plan arrangement to be shared with secretary.--The 
        trustee or issuer (in the case of an individual retirement 
        annuity) of a simple retirement account shall provide to the 
        Secretary, at the time the qualified salary reduction 
        arrangement is established (or not later than December 31, 
        2024, in the case of arrangements in effect on the date of the 
        enactment of this paragraph), a copy of the written arrangement 
        described in paragraph (2)(A).''.
            (2) Simple 401(k)s.--Paragraph (11) of section 401(k), as 
        amended by this section, is further amended by adding at the 
        end the following new subparagraph:
                    ``(F) Plan arrangement to be shared with 
                secretary.--The plan administrator of a cash and 
                deferred arrangement under this paragraph shall provide 
                to the Secretary, at the time the arrangement is 
                established (or not later than December 31, 2024, in 
                the case of arrangements in effect on the date of the 
                enactment of this paragraph), a written copy of the 
                arrangement.''.
    (i) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2023.
    (j) Reports by Secretary.--
            (1) In general.--The Secretary of the Treasury shall, not 
        later than December 31, 2024, and annually thereafter, report 
        to the Committees on Finance and Health, Education, Labor, and 
        Pensions of the Senate and the Committees on Ways and Means and 
        Education and Labor of the House of Representatives on the data 
        described in paragraph (2), together with any recommendations 
        the Secretary deems appropriate.
            (2) Data described.--For purposes of the report required 
        under paragraph (1), the Secretary of the Treasury shall 
        collect data and information on--
                    (A) the number of plans described in section 408(p) 
                or 401(k)(11) of the Internal Revenue Code of 1986 that 
                are maintained or established during a year;
                    (B) the number of participants eligible to 
                participate in such plans for such year;
                    (C) median contribution amounts for the 
                participants described in subparagraph (B);
                    (D) the types of investments that are most common 
                under such plans; and
                    (E) the fee levels charged in connection with the 
                maintenance of accounts under such plans.
        Such data and information shall be collected separately for 
        each type of plan. For purposes of collecting such data, the 
        Secretary of the Treasury may use such data as is otherwise 
        available to the Secretary for publication and may use such 
        approaches as are appropriate under the circumstances, 
        including the use of voluntary surveys and collaboration on 
        studies.

SEC. 609. EMPLOYERS ALLOWED TO REPLACE SIMPLE RETIREMENT ACCOUNTS WITH 
              SAFE HARBOR 401(K) PLANS DURING A YEAR.

    (a) In General.--Section 408(p), as amended by this Act, is further 
amended by adding at the end the following new paragraph:
            ``(12) Replacement of simple retirement accounts with safe 
        harbor plans during plan year.--
                    ``(A) In general.--Subject to the requirements of 
                this paragraph, an employer may elect (in such form and 
                manner as the Secretary may prescribe) at any time 
                during a year to terminate the qualified salary 
                reduction arrangement under paragraph (2), but only if 
                the employer establishes and maintains (as of the day 
                after the termination date) a safe harbor plan to 
                replace the terminated arrangement.
                    ``(B) Combined limits on contributions.--The 
                terminated arrangement and safe harbor plan shall both 
                be treated as violating the requirements of paragraph 
                (2)(A)(ii) or section 401(a)(30) (whichever is 
                applicable) if the aggregate elective contributions of 
                the employee under the terminated arrangement during 
                its last plan year and under the safe harbor plan 
                during its transition year exceed the sum of--
                            ``(i) the applicable dollar amount for such 
                        arrangement (determined on a full-year basis) 
                        under this subsection (after the application of 
                        section 414(v)) with respect to the employee 
                        for such last plan year multiplied by a 
                        fraction equal to the number of days in such 
                        plan year divided by 365, and
                            ``(ii) the applicable dollar amount (as so 
                        determined) under section 402(g)(1) for such 
                        safe harbor plan on such elective contributions 
                        during the transition year multiplied by a 
                        fraction equal to the number of days in such 
                        transition year divided by 365.
                    ``(C) Transition year.--For purposes of this 
                paragraph, the transition year is the period beginning 
                after the termination date and ending on the last day 
                of the calendar year during which the termination 
                occurs.
                    ``(D) Safe harbor plan.--For purposes of this 
                paragraph, the term `safe harbor plan' means a 
                qualified cash or deferred arrangement which meets the 
                requirements of paragraph (11), (12), (13), or (16) of 
                section 401(k).''.
    (b) Waiver of 2-Year Withdrawal Limitation in Case of Plans 
Converting to 401(k) or 403(b).--
            (1) In general.--Paragraph (6) of section 72(t) is 
        amended--
                    (A) by striking ``accounts.--In the case of'' and 
                inserting ``accounts.--
                    ``(A) In general.--In the case of'', and
                    (B) by adding at the end the following new 
                subparagraph:
                    ``(B) Waiver in case of plan conversion to 401(k) 
                or 403(b).--In the case of an employee of an employer 
                which terminates the qualified salary reduction 
                arrangement of the employer under section 408(p) and 
                establishes a qualified cash or deferred arrangement 
                described in section 401(k) or purchases annuity 
                contracts described in section 403(b), subparagraph (A) 
                shall not apply to any amount which is paid in a 
                rollover contribution described in section 408(d)(3) 
                into a qualified trust under section 401(k) (but only 
                if such contribution is subsequently subject to the 
                rules of section 401(k)(2)(B)) or an annuity contract 
                described in section 403(b) (but only if such 
                contribution is subsequently subject to the rules of 
                section 403(b)(11)) for the benefit of the employee.''.
            (2) Conforming amendment.--Subparagraph (G) of section 
        408(d)(3) is amended by striking ``72(t)(6)'' and inserting 
        ``72(t)(6)(A)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after December 31, 2023.

SEC. 610. STARTER 401(K) PLANS FOR EMPLOYERS WITH NO RETIREMENT PLAN.

    (a) In General.--Section 401(k), as amended by this Act, is further 
amended by adding at the end the following new paragraph:
            ``(17) Starter 401(k) deferral-only plans for employers 
        with no retirement plan.--
                    ``(A) In general.--A starter 401(k) deferral-only 
                arrangement maintained by an eligible employer shall be 
                treated as meeting the requirements of paragraph 
                (3)(A)(ii).
                    ``(B) Starter 401(k) deferral-only arrangement.--
                For purposes of this paragraph, the term `starter 
                401(k) deferral-only arrangement' means any cash or 
                deferred arrangement which meets--
                            ``(i) the automatic deferral requirements 
                        of subparagraph (C),
                            ``(ii) the contribution limitations of 
                        subparagraph (D), and
                            ``(iii) the requirements of subparagraph 
                        (E) of paragraph (13).
                    ``(C) Automatic deferral.--
                            ``(i) In general.--The requirements of this 
                        subparagraph are met if, under the arrangement, 
                        each eligible employee is treated as having 
                        elected to have the employer make elective 
                        contributions in an amount equal to a qualified 
                        percentage of compensation.
                            ``(ii) Election out.--The election treated 
                        as having been made under clause (i) shall 
                        cease to apply with respect to any employee if 
                        such employee makes an affirmative election--
                                    ``(I) to not have such 
                                contributions made, or
                                    ``(II) to make elective 
                                contributions at a level specified in 
                                such affirmative election.
                            ``(iii) Qualified percentage.--For purposes 
                        of this subparagraph, the term `qualified 
                        percentage' means, with respect to any 
                        employee, any percentage determined under the 
                        arrangement if such percentage is applied 
                        uniformly and is not less than 3 or more than 
                        15 percent.
                    ``(D) Contribution limitations.--
                            ``(i) In general.--The requirements of this 
                        subparagraph are met if, under the 
                        arrangement--
                                    ``(I) the only contributions which 
                                may be made are elective contributions 
                                of employees described in subparagraph 
                                (C), and
                                    ``(II) the aggregate amount of such 
                                elective contributions which may be 
                                made with respect to any employee for 
                                any calendar year shall not exceed 
                                $6,000.
                            ``(ii) Cost-of-living adjustment.--In the 
                        case of any calendar year beginning after 
                        December 31, 2024, the $6,000 amount under 
                        clause (i) shall be adjusted in the same manner 
                        as under section 402(g)(4), except that `2023' 
                        shall be substituted for `2005'.
                            ``(iii) Catch-up contributions for 
                        individuals age 50 or over.--In the case of an 
                        individual who has attained the age of 50 
                        before the close of the taxable year, the 
                        limitation under clause (i)(II) shall be 
                        increased by the applicable amount determined 
                        under section 219(b)(5)(B)(ii) (after the 
                        application of section 219(b)(5)(C)(iii)).
                    ``(E) Eligible employer.--For purposes of this 
                paragraph--
                            ``(i) In general.--The term `eligible 
                        employer' means any employer if the employer 
                        does not maintain a qualified plan with respect 
                        to which contributions are made, or benefits 
                        are accrued, for service in the year for which 
                        the determination is being made. If only 
                        individuals other than employees described in 
                        subparagraph (A) of section 410(b)(3) are 
                        eligible to participate in such arrangement, 
                        then the preceding sentence shall be applied 
                        without regard to any qualified plan in which 
                        only employees described in such subparagraph 
                        are eligible to participate.
                            ``(ii) Relief for acquisitions, etc.--Rules 
                        similar to the rules of section 408(p)(10) 
                        shall apply for purposes of clause (i).
                            ``(iii) Qualified plan.--The term 
                        `qualified plan' means a plan, contract, 
                        pension, account, or trust described in 
                        subparagraph (A) or (B) of paragraph (5) of 
                        section 219(g) (determined without regard to 
                        the last sentence of such paragraph (5)).
                    ``(F) Eligible employee.--For purposes of this 
                paragraph--
                            ``(i) In general.--The term `eligible 
                        employee' means any employee of the employer 
                        who meets the minimum age and service 
                        conditions described in section 410(a)(1).
                            ``(ii) Exclusions.--The employer may elect 
                        to exclude from such definition any employee 
                        described in paragraph (3) or (4) of section 
                        410(b).''.
    (b) Certain Annuity Contracts.--Subsection (b) of section 403, as 
amended by this Act, is further amended by adding at the end the 
following new paragraph:
            ``(17) Safe harbor deferral-only plans for employers with 
        no retirement plan.--
                    ``(A) In general.--A safe harbor deferral-only plan 
                maintained by an eligible employer shall be treated as 
                meeting the requirements of paragraph (12).
                    ``(B) Safe harbor deferral-only plan.--For purposes 
                of this paragraph, the term `safe harbor deferral-only 
                plan' means any plan which meets--
                            ``(i) the automatic deferral requirements 
                        of subparagraph (C),
                            ``(ii) the contribution limitations of 
                        subparagraph (D), and
                            ``(iii) the requirements of subparagraph 
                        (E) of section 401(k)(13).
                    ``(C) Automatic deferral.--
                            ``(i) In general.--The requirements of this 
                        subparagraph are met if, under the plan, each 
                        eligible employee is treated as having elected 
                        to have the employer make elective 
                        contributions in an amount equal to a qualified 
                        percentage of compensation.
                            ``(ii) Election out.--The election treated 
                        as having been made under clause (i) shall 
                        cease to apply with respect to any eligible 
                        employee if such eligible employee makes an 
                        affirmative election--
                                    ``(I) to not have such 
                                contributions made, or
                                    ``(II) to make elective 
                                contributions at a level specified in 
                                such affirmative election.
                            ``(iii) Qualified percentage.--For purposes 
                        of this subparagraph, the term `qualified 
                        percentage' means, with respect to any 
                        employee, any percentage determined under the 
                        plan if such percentage is applied uniformly 
                        and is not less than 3 or more than 15 percent.
                    ``(D) Contribution limitations.--
                            ``(i) In general.--The requirements of this 
                        subparagraph are met if, under the plan--
                                    ``(I) the only contributions which 
                                may be made are elective contributions 
                                of eligible employees, and
                                    ``(II) the aggregate amount of such 
                                elective contributions which may be 
                                made with respect to any employee for 
                                any calendar year shall not exceed 
                                $6,000.
                            ``(ii) Cost-of-living adjustment.--In the 
                        case of any calendar year beginning after 
                        December 31, 2024, the $6,000 amount under 
                        clause (i) shall be adjusted in the same manner 
                        as under section 402(g)(4), except that `2023' 
                        shall be substituted for `2005'.
                            ``(iii) Catch-up contributions for 
                        individuals age 50 or over.--In the case of an 
                        individual who has attained the age of 50 
                        before the close of the taxable year, the 
                        limitation under clause (i)(II) shall be 
                        increased by the applicable amount determined 
                        under section 219(b)(5)(B)(ii) (after the 
                        application of section 219(b)(5)(C)(iii)).
                    ``(E) Eligible employer.--For purposes of this 
                paragraph--
                            ``(i) In general.--The term `eligible 
                        employer' means any employer if the employer 
                        does not maintain a qualified plan with respect 
                        to which contributions are made, or benefits 
                        are accrued, for service in the year for which 
                        the determination is being made. If only 
                        individuals other than employees described in 
                        subparagraph (A) of section 410(b)(3) are 
                        eligible to participate in such arrangement, 
                        then the preceding sentence shall be applied 
                        without regard to any qualified plan in which 
                        only employees described in such subparagraph 
                        are eligible to participate.
                            ``(ii) Relief for acquisitions, etc.--Rules 
                        similar to the rules of section 408(p)(10) 
                        shall apply for purposes of clause (i).
                            ``(iii) Qualified plan.--The term 
                        `qualified plan' means a plan, contract, 
                        pension, account, or trust described in 
                        subparagraph (A) or (B) of paragraph (5) of 
                        section 219(g) (determined without regard to 
                        the last sentence of such paragraph (5)).
                    ``(F) Eligible employee.--For purposes of this 
                paragraph, the term `eligible employee' means any 
                employee of the employer other than an employee who is 
                permitted to be excluded under paragraph (12)(A).''.
    (c) Starter and Safe Harbor Plans Not Treated as Top-Heavy Plans.--
Subparagraph (H) of section 416(g)(4), as amended by this Act, is 
further amended--
            (1) by striking ``arrangements'' in the heading and 
        inserting ``arrangements or plans'',
            (2) by striking ``, and'' at the end of clause (i) and 
        inserting ``and matching contributions with respect to which 
        the requirements of paragraph (11), (12), or (13) of section 
        401(m) are met, or'', and
            (3) by striking clause (ii) and inserting after clause (i) 
        the following new clause:
                            ``(ii) a starter 401(k) deferral-only 
                        arrangement described in section 401(k)(17)(B) 
                        or a safe harbor deferral-only plan described 
                        in section 403(b)(17).''.
    (d) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after December 31, 2023.

SEC. 611. CREDIT FOR SMALL EMPLOYERS THAT ADAPT AN AUTOMATIC 
              PORTABILITY ARRANGEMENT.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1, 
as amended by this Act, is further amended by adding at the end the 
following new section:

``SEC. 45W. EMPLOYER AUTOMATIC PORTABILITY ARRANGEMENT CREDIT.

    ``(a) In General.--For purposes of section 38, in the case of an 
eligible employer, the automatic portability arrangement credit 
determined under this section for the adoption year is an amount equal 
to $500.
    ``(b) Eligible Employer.--For purposes of this section, the term 
`eligible employer' has the meaning given the term by section 
408(p)(2)(C)(i) (without regard to subclause (II) thereof).
    ``(c) Adoption Year.--For purposes of this section--
            ``(1) In general.--The term `adoption year' means the 
        taxable year during which the eligible employer first adopts an 
        automatic portability arrangement as part of an eligible plan 
        maintained by the employer.
            ``(2) Automatic portability arrangement.--
                    ``(A) In general.--The term `automatic portability 
                arrangement' means an arrangement providing for 
                automatic portability transactions.
                    ``(B) Automatic portability transaction.--The term 
                `automatic portability transaction' means a transaction 
                in which amounts distributed pursuant to section 
                401(a)(31)(B)(i) from a plan to an individual 
                retirement plan established on behalf of an individual 
                are subsequently transferred to an eligible plan in 
                which such individual is an active participant, after 
                such individual has been given advance notice of the 
                transfer and has not affirmatively opted out of such 
                transfer.
            ``(3) Eligible plan.--The term `eligible plan' means a 
        qualified employer plan as defined in section 4972(d)(1), other 
        than a defined benefit plan.''.
    (b) Credit to Be Part of General Business Credit.--Subsection (b) 
of section 38, as amended by this Act, is further amended by striking 
``plus'' at the end of paragraph (34), by striking the period at the 
end of paragraph (35) and inserting ``, plus'', and by adding at the 
end the following new paragraph:
            ``(36) in the case of an eligible employer (as defined in 
        section 45W(b)), the automatic portability arrangement credit 
        determined under section 45W(a).''.
    (c) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1, as amended by this Act, is 
further amended by adding at the end the following new item:

``Sec. 45W. Employer automatic portability arrangement credit.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 612. RE-ENROLLMENT CREDIT.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1, 
as amended by this Act, is further amended by adding at the end the 
following new section:

``SEC. 45X. CREDIT FOR RE-ENROLLMENT PROVISIONS IN PLANS PROVIDED BY 
              SMALL EMPLOYERS.

    ``(a) In General.--For purposes of section 38, in the case of an 
eligible employer, the retirement re-enrollment credit determined under 
this section for any taxable year is an amount equal to--
            ``(1) $500 for any taxable year occurring during the credit 
        period, and
            ``(2) zero for any other taxable year.
    ``(b) Credit Period.--For purposes of subsection (a)--
            ``(1) In general.--The credit period with respect to any 
        eligible employer is the 3-taxable-year period beginning with 
        the first taxable year for which the employer includes a re-
        enrollment provision in an eligible automatic contribution 
        arrangement (as defined in section 414(w)(3)) in a qualified 
        employer plan (as defined in section 4972(d)) maintained by the 
        employer.
            ``(2) Maintenance of arrangement.--No taxable year with 
        respect to an employer shall be treated as occurring within the 
        credit period unless the provision described in paragraph (1) 
        is included in the plan for such year.
    ``(c) Eligible Employer.--For purposes of this section, the term 
`eligible employer' has the meaning given such term in section 
408(p)(2)(C)(i).
    ``(d) Re-Enrollment Provision.--For purposes of this section, the 
term `re-enrollment provision' means a provision of an eligible 
automatic contribution arrangement under which--
            ``(1) In general.--Each employee eligible to participate in 
        the arrangement who is not contributing or is contributing less 
        than the percentage applicable to an eligible employee in the 
        first year of eligibility is treated as being in such first 
        year of eligibility in each applicable year with respect to the 
        employee.
            ``(2) Election out.--The election treated as having been 
        made under paragraph (1) shall cease to apply with respect to 
        any employee if such employee makes an affirmative election--
                    ``(A) to not have such contributions made, or
                    ``(B) to make elective contributions at a level 
                specified in such affirmative election.
            ``(3) Applicable year every third year.--
                    ``(A) In general.--For purposes of this section, 
                the term `applicable year' means, with respect to an 
                employee, such employee's first plan year of 
                eligibility under the arrangement, and all subsequent 
                plan years of eligibility.
                    ``(B) Exception.--Following any applicable year of 
                an employee (determined after the application of this 
                subparagraph), the plan may elect to treat the next 1 
                or 2 plan years as not being applicable years with 
                respect to such employee.''.
    (b) Credit to Be Part of General Business Credit.--Subsection (b) 
of section 38, as amended by this Act, is further amended by striking 
``plus'' at the end of paragraph (35), by striking the period at the 
end of paragraph (36) and inserting ``, plus'', and by adding at the 
end the following new paragraph:
            ``(37) in the case of an eligible employer (as defined in 
        section 45X(c)), the retirement re-enrollment credit determined 
        under section 45X(a).''.
    (c) Treatment of Credit for Certified Professional Employer 
Organizations.--Paragraph (2) of section 3511(d), as amended by this 
Act, is further amended--
            (1) by redesignating subparagraphs (H), (I), (J), and (K) 
        as subparagraphs (I), (J), (K), and (L) respectively, and
            (2) by inserting after subparagraph (G) the following new 
        subparagraph:
                    ``(H) section 45X (retirement re-enrollment 
                credit),''.
    (d) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1, as amended by this Act, is 
further amended by inserting after the item relating to section 45W the 
following new item:

``Sec. 45X. Credit for re-enrollment provisions in plans provided by 
                            small employers.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2023.

SEC. 613. CORRECTIONS OF MORTALITY TABLES.

    (a) In General.--Not later than 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 relating to 
``Mortality Tables for Determining Present Value Under Defined Benefit 
Pension Plans'' (82 Fed. Reg. 46388 (October 5, 2017)). Under such 
amendment, for valuation dates occurring during or after 2022, such 
mortality improvement rates shall not assume future mortality 
improvements at any age which are greater than .78 percent. The 
Secretary of the Treasury (or delegate) shall by regulation modify the 
.78 percent figure in the preceding sentence as necessary to reflect 
material changes in the overall rate of improvement projected by the 
Social Security Administration.
    (b) Effective Date.--The amendments required under subsection (a) 
shall be deemed to have been made as of the date of the enactment of 
this Act, and as of such date all applicable laws shall be applied in 
all respects as though the actions which the Secretary of the Treasury 
(or the Secretary's delegate) is required to take under such subsection 
had been taken.

SEC. 614. ENHANCING RETIREE HEALTH BENEFITS IN PENSION PLANS.

    (a) Extension of Transfers of Excess Pension Assets to Retiree 
Health Accounts.--Paragraph (4) of section 420(b) is amended by 
striking ``December 31, 2025'' and inserting ``December 31, 2032''.
    (b) De Minimis Transfer Rule.--
            (1) In general.--Subsection (e) of section 420 is amended 
        by adding at the end the following new paragraph:
            ``(7) Special rule for de minimis transfers.--
                    ``(A) In general.--In the case of a transfer of an 
                amount which is not more than 1.75 percent of the 
                amount determined under paragraph (2)(A) by a plan 
                which meets the requirements of subparagraph (B), 
                paragraph (2)(B) shall be applied by substituting `110 
                percent' for `125 percent'.
                    ``(B) Two-year lookback requirement.--A plan is 
                described in this subparagraph if, as of any valuation 
                date in each of the 2 plan years immediately preceding 
                the plan year in which the transfer occurs, the amount 
                determined under paragraph (2)(A) exceeded 110 percent 
                of the sum of the funding target and the target normal 
                cost determined under section 430 for each such plan 
                year.''.
            (2) Cost maintenance period.--Subparagraph (D) of section 
        420(c)(3) is amended by striking ``5 taxable years'' and 
        inserting ``5 taxable years (7 taxable years in the case of a 
        transfer to which subsection (e)(7) applies)''.
            (3) Conforming amendments.--
                    (A) Excess pension assets.--Clause (i) of section 
                420(f)(2)(B) is amended--
                            (i) by striking ``In general.--In'' and 
                        inserting ``In general.--
                                    ``(I) Determination.--In'',
                            (ii) by striking ``subsection (e)(2)'' and 
                        inserting ``subsection (e)(2)(B)'', and
                            (iii) by adding at the end the following 
                        new subclause:
                                    ``(II) Special rule for 
                                collectively bargained transfers.--In 
                                determining excess pension assets for 
                                purposes of a collectively bargained 
                                transfer, subsection (e)(7) shall not 
                                apply.''.
                    (B) Minimum cost.--Subclause (I) of section 
                420(f)(2)(D)(i) is amended by striking ``4th year'' and 
                inserting ``4th year (the 6th year in the case of a 
                transfer to which subsection (e)(7) applies)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to transfers made after the date of the enactment of this Act.

SEC. 615. DEFERRAL OF TAX FOR CERTAIN SALES OF EMPLOYER STOCK TO 
              EMPLOYEE STOCK OWNERSHIP PLAN SPONSORED BY S CORPORATION.

    (a) In General.--Section 1042(c)(1)(A) is amended by striking 
``domestic C corporation'' and inserting ``domestic corporation''.
    (b) 10 Percent Limitation on Application of Gain on Sale of S 
Corporation Stock.--Section 1042 is amended by adding at the end the 
following new subsection:
    ``(h) Application of Section to Sale of Stock in S Corporation.--In 
the case of the sale of qualified securities of an S corporation, the 
election under subsection (a) may be made with respect to not more than 
10 percent of the amount realized on such sale for purposes of 
determining the amount of gain not recognized and the extent to which 
(if at all) the amount realized on such sale exceeds the cost of 
qualified replacement property. The portion of adjusted basis that is 
properly allocable to the portion of the amount realized with respect 
to which the election is made under this subsection shall be taken into 
account for purposes of the preceding sentence.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to sales after December 31, 2027.

                           TITLE VII--NOTICES

SEC. 701. REVIEW AND REPORT TO CONGRESS RELATING TO REPORTING AND 
              DISCLOSURE REQUIREMENTS.

    (a) Study.--As soon as practicable after the date of enactment of 
this Act, the Secretary of Labor, the Secretary of the Treasury, and 
the Director of the Pension Benefit Guaranty Corporation shall review 
the reporting and disclosure requirements as applicable to each such 
agency head, of--
            (1) the Employee Retirement Income Security Act of 1974 
        applicable to pension plans (as defined in section 3(2) of such 
        Act (29 U.S.C. 1002(2)); and
            (2) the Internal Revenue Code of 1986 applicable to 
        qualified retirement plans (as defined in section 4974(c) of 
        such Code, without regard to paragraphs (4) and (5) of such 
        section).
    (b) Report.--
            (1) In general.--Not later than 2 years after the date of 
        enactment of this Act, the Secretary of Labor, the Secretary of 
        the Treasury, and the Director of the Pension Benefit Guaranty 
        Corporation, jointly, and after consultation with a balanced 
        group of participant and employer representatives, shall with 
        respect to plans referenced in subsection (a) report on the 
        effectiveness of the applicable reporting and disclosure 
        requirements and make such recommendations as may be 
        appropriate to the Committee on Education and Labor and the 
        Committee on Ways and Means of the House of Representatives and 
        the Committee on Health, Education, Labor, and Pensions and the 
        Committee on Finance of the Senate to consolidate, simplify, 
        standardize, and improve such requirements so as to simplify 
        reporting for such plans and ensure that plans can furnish and 
        participants and beneficiaries timely receive and better 
        understand the information they need to monitor their plans, 
        plan for retirement, and obtain the benefits they have earned.
            (2) Analysis of effectiveness.--To assess the effectiveness 
        of the applicable reporting and disclosure requirements, the 
        report shall include an analysis, based on plan data, of how 
        participants and beneficiaries are providing preferred contact 
        information, the methods by which plan sponsors and plans are 
        furnishing disclosures, and the rate at which participants and 
        beneficiaries (grouped by key demographics) are receiving, 
        accessing, understanding, and retaining disclosures.
            (3) Collection of information.--The agencies shall conduct 
        appropriate surveys and data collection to obtain any needed 
        information.

SEC. 702. REPORT TO CONGRESS ON SECTION 402(F) NOTICES.

    Not later than 18 months after the date of the enactment of this 
Act, the Comptroller General of the United States shall submit a report 
to the Committees on Finance and Health, Education, Labor, and Pensions 
of the Senate and the Committees on Ways and Means and Education and 
Labor of the House of Representatives on the notices provided by 
retirement plan administrators to plan participants under section 
402(f) of the Internal Revenue Code of 1986. The report shall analyze 
the effectiveness of such notices and make recommendations, as 
warranted by the findings, to facilitate better understanding by 
recipients of different distribution options and corresponding tax 
consequences, including spousal rights.

SEC. 703. ELIMINATING UNNECESSARY PLAN REQUIREMENTS RELATED TO 
              UNENROLLED PARTICIPANTS.

    (a) In General.--Section 414, as amended by this Act, is further 
amended by adding at the end the following new subsection:
    ``(bb) Eliminating Unnecessary Plan Requirements Related to 
Unenrolled Participants.--
            ``(1) In general.--Notwithstanding any other provision of 
        this title, with respect to any defined contribution plan, no 
        disclosure, notice, or other plan document (other than the 
        notices and documents described in subparagraphs (A) and (B)) 
        shall be required to be furnished under this title to any 
        unenrolled participant if the unenrolled participant receives--
                    ``(A) an annual reminder notice of such 
                participant's eligibility to participate in such plan 
                and any applicable election deadlines under the plan, 
                and
                    ``(B) any document requested by such participant 
                which the participant would be entitled to receive 
                notwithstanding this subsection.
            ``(2) Unenrolled participant.--For purposes of this 
        subsection, the term `unenrolled participant' means an employee 
        who--
                    ``(A) is eligible to participate in a defined 
                contribution plan,
                    ``(B) has received--
                            ``(i) the summary plan description pursuant 
                        to section 104(b) of the Employee Retirement 
                        Income Security Act of 1974, and
                            ``(ii) any other notices related to 
                        eligibility under the plan which are required 
                        to be furnished under this title or the 
                        Employee Retirement Income Security Act of 1974 
                        in connection with such participant's initial 
                        eligibility to participate in such plan,
                    ``(C) is not participating in such plan,
                    ``(D) does not have an account balance in the plan, 
                and
                    ``(E) satisfies such other criteria as the 
                Secretary may determine appropriate, as prescribed in 
                guidance issued in consultation with the Secretary of 
                Labor.
        For purposes of this subsection, any eligibility to participate 
        in the plan following any period for which such employee was 
        not eligible to participate shall be treated as initial 
        eligibility.
            ``(3) Annual reminder notice.--For purposes of this 
        subsection, the term `annual reminder notice' means the notice 
        described in section 111(c) of the Employee Retirement Income 
        Security Act of 1974.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to plan years beginning after the date of the enactment of this 
Act.

                  TITLE VIII--TECHNICAL MODIFICATIONS

SEC. 801. REPAYMENT OF QUALIFIED BIRTH OR ADOPTION DISTRIBUTION LIMITED 
              TO 3 YEARS.

    (a) In General.--Section 72(t)(2)(H)(v)(I) is amended by striking 
``may make'' and inserting ``may, at any time during the 3-year period 
beginning on the day after the date on which such distribution was 
received, make''.
    (b) Effective Date.--The amendment made by this section shall take 
effect as if included in the enactment of section 113 of the Setting 
Every Community Up for Retirement Enhancement Act of 2019.

SEC. 802. AMENDMENTS RELATING TO SETTING EVERY COMMUNITY UP FOR 
              RETIREMENT ENHANCEMENT ACT OF 2019.

    (a) Technical Amendments.--
            (1) Amendments relating to section 103.--Section 401(m)(12) 
        is amended by striking ``and'' at the end of subparagraph (A), 
        by redesignating subparagraph (B) as subparagraph (C), and by 
        inserting after subparagraph (A) (as so amended) the following 
        new subparagraph:
                    ``(B) meets the notice requirements of subsection 
                (k)(13)(E), and''.
            (2) Amendments relating to section 112.--
                    (A) Section 401(k)(15)(B)(i)(II), as amended by 
                this Act, is further amended by striking ``subsection 
                (m)(2)'' and inserting ``paragraphs (2), (11), and (12) 
                of subsection (m)''.
                    (B) Section 401(k)(15)(B)(iii) is amended by 
                striking ``under the arrangement'' and inserting 
                ``under the plan''.
                    (C) Section 401(k)(15)(B)(iv) is amended by 
                striking ``section 410(a)(1)(A)(ii)'' and inserting 
                ``paragraph (2)(D)''.
            (3) Amendment relating to section 116.--Section 4973(b) is 
        amended by adding at the end of the flush matter the following: 
        ``Such term shall not include any designated nondeductible 
        contribution (as defined in subparagraph (C) of section 
        408(o)(2)) which does not exceed the nondeductible limit under 
        subparagraph (B) thereof by reason of an election under section 
        408(o)(5).''.
    (b) Clerical Amendments.--
            (1) Section 72(t)(2)(H)(vi)(IV) is amended by striking 
        ``403(b)(7)(A)(ii)'' and inserting `` 403(b)(7)(A)(i)''.
            (2) Section 401(k)(12)(G) is amended by striking ``the 
        requirements under subparagraph (A)(i)'' and inserting ``the 
        contribution requirements under subparagraph (B) or (C)''.
            (3) Section 401(k)(13)(D)(iv) is amended by striking ``and 
        (F)'' and inserting ``and (G)''.
            (4) Section 408(o)(5)(A) is amended by striking 
        ``subsection (b)'' and inserting ``section 219(b)''.
    (c) Effective Date.--The amendments made by this section shall take 
effect as if included in section of the Setting Every Community Up for 
Retirement Enhancement Act of 2019 to which the amendment relates.

SEC. 803. MODIFICATION OF REQUIRED MINIMUM DISTRIBUTION RULES FOR 
              SPECIAL NEEDS TRUSTS.

    (a) In General.--Section 401(a)(9)(H)(iv)(II) is amended by 
striking ``no individual'' and inserting ``no beneficiary''.
    (b) Conforming Amendment.--Section 401(a)(9)(H)(v) is amended by 
adding at the end the following flush sentence:
                        ``For purposes of the preceding sentence, in 
                        the case of a trust the terms of which are 
                        described in clause (iv)(II), any beneficiary 
                        which is an organization described in section 
                        408(d)(8)(B)(i) shall be treated as a 
                        designated beneficiary described in subclause 
                        (II).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to calendar years beginning after the date of the enactment of 
this Act.

                       TITLE IX--PLAN AMENDMENTS

SEC. 901. PROVISIONS RELATING TO PLAN AMENDMENTS.

    (a) In General.--If this section applies to any retirement plan or 
contract amendment--
            (1) such retirement plan or contract shall be treated as 
        being operated in accordance with the terms of the plan during 
        the period described in subsection (b)(2)(A); and
            (2) to the extent provided by the Secretary of the Treasury 
        (or the Secretary's delegate), such retirement plan shall not 
        fail to meet the requirements of section 411(d)(6) of the 
        Internal Revenue Code of 1986 and section 204(g) of the 
        Employee Retirement Income Security Act of 1974 by reason of 
        such amendment.
    (b) Amendments to Which Section Applies.--
            (1) In general.--This section shall apply to any amendment 
        to any retirement plan or annuity contract which is made--
                    (A) pursuant to any amendment made by this Act or 
                pursuant to any regulation issued by the Secretary of 
                the Treasury or the Secretary of Labor (or a delegate 
                of either such Secretary) under this Act; and
                    (B) on or before the last day of the first plan 
                year beginning on or after January 1, 2024, or such 
                later date as the Secretary of the Treasury may 
                prescribe.
        In the case of a governmental plan (as defined in section 
        414(d) of the Internal Revenue Code of 1986), or an applicable 
        collectively bargained plan, this paragraph shall be applied by 
        substituting ``2026'' for ``2024''. For purposes of the 
        preceding sentence, the term ``applicable collectively 
        bargained plan'' means a plan maintained pursuant to 1 or more 
        collective bargaining agreements between employee 
        representatives and 1 or more employers ratified before the 
        date of enactment of this Act.
            (2) Conditions.--This section shall not apply to any 
        amendment unless--
                    (A) during the period--
                            (i) beginning on the date the legislative 
                        or regulatory amendment described in paragraph 
                        (1)(A) takes effect (or in the case of a plan 
                        or contract amendment not required by such 
                        legislative or regulatory amendment, the 
                        effective date specified by the plan); and
                            (ii) ending on the date described in 
                        paragraph (1)(B) (as modified by the second 
                        sentence of paragraph (1)) (or, if earlier, the 
                        date the plan or contract amendment is 
                        adopted),
                the plan or contract is operated as if such plan or 
                contract amendment were in effect; and
                    (B) such plan or contract amendment applies 
                retroactively for such period.
    (c) Coordination With Other Provisions Relating to Plan 
Amendments.--
            (1) SECURE act.--Section 601(b)(1) of the Setting Every 
        Community Up for Retirement Enhancement Act of 2019 is 
        amended--
                    (A) by striking ``January 1, 2022'' in subparagraph 
                (B) and inserting ``January 1, 2024'', and
                    (B) by striking ``substituting `2024' for `2022'.'' 
                in the flush matter at the end and inserting 
                ``substituting `2026' for `2024'.''.
            (2) CARES act.--
                    (A) Special rules for use of retirement funds.--
                Section 2202(c)(2)(A) of the CARES Act is amended by 
                striking ``January 1, 2022'' in clause (ii) and 
                inserting ``January 1, 2024''.
                    (B) Temporary waiver of required minimum 
                distributions rules for certain retirement plans and 
                accounts.--Section 2203(c)(2)(B)(i) of the CARES Act is 
                amended--
                            (i) by striking ``January 1, 2022'' in 
                        subclause (II) and inserting ``January 1, 
                        2024'', and
                            (ii) by striking ``substituting `2024' for 
                        `2022'.'' in the flush matter at the end and 
                        inserting ``substituting `2026' for `2024'.''.
                    (C) Taxpayer certainty and disaster tax relief act 
                of 2020.--Section 302(d)(2)(A) of the Taxpayer 
                Certainty and Disaster Tax Relief Act of 2020 is 
                amended by striking ``January 1, 2022'' in clause (ii) 
                and inserting ``January 1, 2024''.

                TITLE X--TAX COURT RETIREMENT PROVISIONS

SEC. 1001. PROVISIONS RELATING TO JUDGES OF THE TAX COURT.

    (a) Thrift Savings Plan Contributions for Judges in the Federal 
Employees Retirement System.--
            (1) In general.--Subsection (j)(3)(B) of section 7447 is 
        amended to read as follows:
                    ``(B) Contributions for benefit of judge.--No 
                contributions under section 8432(c) of title 5, United 
                States Code, shall be made for the benefit of a judge 
                who has filed an election to receive retired pay under 
                subsection (e).''.
            (2) Offset.--Paragraph (3) of section 7447(j) is amended by 
        adding at the end the following new subparagraph:
                    ``(F) Offset.--In the case of a judge who receives 
                a distribution from the Thrift Savings Plan and who 
                later receives retired pay under subsection (d), the 
                retired pay shall be offset by an amount equal to the 
                amount of the distribution which represents the 
                Government's contribution to the individual's Thrift 
                Savings Account during years of service as a full-time 
                judicial officer under the Federal Employees Retirement 
                System, without regard to earnings attributable to such 
                amount. Where such an offset would exceed 50 percent of 
                the retired pay to be received in the first year, the 
                offset may be divided equally over the first 2 years in 
                which the individual receives the annuity.''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to basic pay earned while serving as a judge of the 
        United States Tax Court on or after the date of the enactment 
        of this Act.
    (b) Change in Vesting Period for Survivor Annuities and Waiver of 
Vesting Period in the Event of Assassination.--
            (1) Eligibility in case of death.--Subsection (h) of 
        section 7448 is amended to read as follows:
    ``(h) Entitlement to Annuity.--
            ``(1) In general.--
                    ``(A) Annuity to surviving spouse.--If a judge or 
                special trial judge described in paragraph (2) is 
                survived by a surviving spouse but not by a dependent 
                child, there shall be paid to such surviving spouse an 
                annuity beginning with the day of the death of the 
                judge or special trial judge or following the surviving 
                spouse's attainment of age 50, whichever is the later, 
                in an amount computed as provided in subsection (m).
                    ``(B) Annuity to surviving spouse and child.--If a 
                judge or special trial judge described in paragraph (2) 
                is survived by a surviving spouse and dependent child 
                or children, there shall be paid to such surviving 
                spouse an annuity, beginning on the day of the death of 
                the judge or special trial judge, in an amount computed 
                as provided in subsection (m), and there shall also be 
                paid to or on behalf of each such child an immediate 
                annuity equal to the lesser of--
                            ``(i) 10 percent of the average annual 
                        salary of such judge or special trial judge 
                        (determined in accordance with subsection (m)), 
                        or
                            ``(ii) 20 percent of such average annual 
                        salary, divided by the number of such children.
                    ``(C) Annuity to surviving dependent children.--If 
                a judge or special trial judge described in paragraph 
                (2) leaves no surviving spouse but leaves a surviving 
                dependent child or children, there shall be paid to or 
                on behalf of each such child an immediate annuity equal 
                to the lesser of--
                            ``(i) 20 percent of the average annual 
                        salary of such judge or special trial judge 
                        (determined in accordance with subsection (m)), 
                        or
                            ``(ii) 40 percent of such average annual 
                        salary divided by the number of such children.
            ``(2) Covered judges.--Paragraph (1) applies to any judge 
        or special trial judge electing under subsection (b)--
                    ``(A) who dies while a judge or special trial judge 
                after having rendered at least 18 months of civilian 
                service computed as prescribed in subsection (n), for 
                the last 18 months of which the salary deductions 
                provided for by subsection (c)(1) or the deposits 
                required by subsection (d) have actually been made or 
                the salary deductions required by the civil service 
                retirement laws have actually been made, or
                    ``(B) who dies by assassination after having 
                rendered less than 18 months of civilian service 
                computed as prescribed in subsection (n) if, for the 
                period of such service, the salary deductions provided 
                for by subsection (c)(1) or the deposits required by 
                subsection (d) have actually been made.
            ``(3) Termination of annuity.--
                    ``(A) Surviving spouse.--The annuity payable to a 
                surviving spouse under this subsection shall be 
                terminable upon such surviving spouse's death or such 
                surviving spouse's remarriage before attaining age 55.
                    ``(B) Surviving child.--Any annuity payable to a 
                child under this subsection shall be terminable upon 
                the earliest of--
                            ``(i) the child's attainment of age 18,
                            ``(ii) the child's marriage, or
                            ``(iii) the child's death,
                except that if such child is incapable of self-support 
                by reason of mental or physical disability the child's 
                annuity shall be terminable only upon death, marriage, 
                or recovery from such disability.
                    ``(C) Dependent child after death of surviving 
                spouse.--In case of the death of a surviving spouse of 
                a judge or special trial judge leaving a dependent 
                child or children of the judge or special trial judge 
                surviving such spouse, the annuity of such child or 
                children shall be recomputed and paid as provided in 
                paragraph (1)(C).
                    ``(D) Recomputation with respect to other dependent 
                children.--In any case in which the annuity of a 
                dependent child is terminated under this subsection, 
                the annuities of any remaining dependent child or 
                children based upon the service of the same judge or 
                special trial judge shall be recomputed and paid as 
                though the child whose annuity was so terminated had 
                not survived such judge.
                    ``(E) Special rule for assassinated judges.--In the 
                case of a survivor of a judge or special trial judge 
                described in paragraph (2)(B), there shall be deducted 
                from the annuities otherwise payable under this section 
                an amount equal to the amount of salary deductions that 
                would have been made if such deductions had been made 
                for 18 months prior to the death of the judge or 
                special trial judge.''.
            (2) Definition of assassination.--Section 7448(a) is 
        amended by adding at the end the following new paragraph:
            ``(10) The terms `assassinated' and `assassination' mean 
        the killing of a judge or special trial judge that is motivated 
        by the performance by the judge or special trial judge of his 
        or her official duties.''.
            (3) Determination of assassination.--Subsection (i) of 
        section 7448 is amended--
                    (A) by striking ``of Dependency and Disability.--
                Questions'' and inserting ``by Chief Judge.--
            ``(1) Dependency and disability.--Questions'', and
                    (B) by adding at the end the following new 
                paragraph:
            ``(2) Assassination.--The chief judge shall determine 
        whether the killing of a judge or special trial judge was an 
        assassination, subject to review only by the Tax Court. The 
        head of any Federal agency that investigates the killing of a 
        judge or special trial judge shall provide to the chief judge 
        any information that would assist the chief judge in making 
        such a determination.''.
            (4) Computation of annuities.--Subsection (m) of section 
        7448 is amended--
                    (A) by striking ``Annuities.--The annuity'' and 
                inserting ``Annuities.--
            ``(1) In general.--Except as provided in paragraph (2), the 
        annuity'',
                    (B) by striking ``the sum of (1) 1.5 percent'' and 
                inserting ``the sum of--
                    ``(A) 1.5 percent'',
                    (C) by striking ``and (2) three-fourths of 1 
                percent'' and inserting ``and
                    ``(B) three-fourths of 1 percent'',
                    (D) by striking ``prior allowable service, except 
                that'' and inserting ``prior allowable service,
        ``except that'', and
                    (E) by adding at the end the following new 
                paragraph:
            ``(2) Service of less than 3 years.--In the case of a judge 
        or special trial judge who has served less than 3 years, the 
        annuity of the surviving spouse of such judge or special trial 
        judge shall be based upon the average annual salary received by 
        such judge or special trial judge for judicial service prior to 
        the death of the judge or special trial judge.''.
            (5) Other benefits.--Section 7448 is amended by adding at 
        the end the following new subsection:
    ``(u) Other Benefits in Case of Assassination.--In the case of a 
judge or special trial judge who is assassinated, an annuity shall be 
paid under this section notwithstanding a survivor's eligibility for or 
receipt of benefits under chapter 81 of title 5, United States Code, 
except that the annuity for which a surviving spouse is eligible under 
this section shall be reduced to the extent that the total benefits 
paid under this section and chapter 81 of that title for any year would 
exceed the current salary for that year of the office of the judge or 
special trial judge.''.
    (c) Coordination of Retirement and Survivor Annuity With the 
Federal Employees Retirement System.--
            (1) Retirement.--Section 7447 is amended--
                    (A) by striking ``section 8331(8)'' in subsection 
                (g)(2)(C) and inserting ``sections 8331(8) and 
                8401(19)'', and
                    (B) by striking ``Civil Service Commission'' both 
                places it appears in subsection (i)(2) and inserting 
                ``Office of Personnel Management''.
            (2) Annuities to surviving spouses and dependent 
        children.--Section 7448 is amended--
                    (A) by striking ``section 8332'' in subsection (d) 
                and inserting ``sections 8332 and 8411'', and
                    (B) by striking ``section 8332'' in subsection (n) 
                and inserting ``sections 8332 and 8411''.
    (d) Limit on Teaching Compensation of Retired Judges.--
            (1) In general.--Section 7447 is amended by adding at the 
        end the following new subsection:
    ``(k) Teaching Compensation of Retired Judges.--For purposes of the 
limitation under section 501(a) of the Ethics in Government Act of 1978 
(5 U.S.C. App.), any compensation for teaching approved under section 
502(a)(5) of such Act shall not be treated as outside earned income 
when received by a judge of the United States Tax Court who has retired 
under subsection (b) for teaching performed during any calendar year 
for which such a judge has met the requirements of subsection (c), as 
certified by the chief judge.''.
            (2) Effective date.--The amendment made by this subsection 
        shall apply to any individual serving as a retired judge of the 
        United States Tax Court on or after the date of the enactment 
        of this Act.
    (e) Effective Date.--Except as otherwise provided, the amendments 
made by this section shall take effect on the date of the enactment of 
this Act.

SEC. 1002. PROVISIONS RELATING TO SPECIAL TRIAL JUDGES OF THE TAX 
              COURT.

    (a) Retirement and Recall for Special Trial Judges.--Part I of 
subchapter C of chapter 76 is amended by inserting after section 7447 
the following new section:

``SEC. 7447A. RETIREMENT FOR SPECIAL TRIAL JUDGES.

    ``(a) In General.--
            ``(1) Retirement.--Any special trial judge appointed 
        pursuant to section 7443A may retire from service as a special 
        trial judge if the individual meets the age and service 
        requirements set forth in the following table:


------------------------------------------------------------------------
                                           And the years of service as a
``If the special trial judge has attained    special trial judge are at
                   age:                                least:
------------------------------------------------------------------------
                                       65  15
                                       66  14
                                       67  13
                                       68  12
                                       69  11
                                       70  10.
------------------------------------------------------------------------

            ``(2) Length of service.--In making any determination of 
        length of service as a special trial judge there shall be 
        included all periods (whether or not consecutive) during which 
        an individual served as a special trial judge
    ``(b) Retirement Upon Disability.--Any special trial judge 
appointed pursuant to section 7443A who becomes permanently disabled 
from performing such individual's duties shall retire from service as a 
special trial judge.
    ``(c) Recalling of Retired Special Trial Judges.--Any individual 
who has retired pursuant to subsection (a) may be called upon by the 
chief judge to perform such judicial duties with the Tax Court as may 
be requested of such individual for a period or periods specified by 
the chief judge, except that in the case of any such individual--
            ``(1) the aggregate of such periods in any 1 calendar year 
        shall not (without the consent of such individual) exceed 90 
        calendar days, and
            ``(2) such individual shall be relieved of performing such 
        duties during any period in which illness or disability 
        precludes the performance of such duties.
Any act, or failure to act, by an individual performing judicial duties 
pursuant to this subsection shall have the same force and effect as if 
it were the act (or failure to act) of a special trial judge. Any 
individual who is performing judicial duties pursuant to this 
subsection shall be paid the same compensation (in lieu of retired pay) 
and allowances for travel and other expenses as a special trial judge.
    ``(d) Retired Pay.--
            ``(1) In general.--Any individual who retires pursuant to 
        subsection (a) and elects under subsection (e) to receive 
        retired pay under this subsection shall receive retired pay 
        during any period of retirement from service as a special trial 
        judge at a rate which bears the same ratio to the rate of the 
        salary payable to a special trial judge during such period as--
                    ``(A) the number of years such individual has 
                served as special trial judge bears to,
                    ``(B) 15,
        except that the rate of such retired pay shall not be more than 
        the rate of such salary for such period.
            ``(2) Retirement upon disability.--Any individual who 
        retires pursuant to subsection (b) and elects under subsection 
        (e) to receive retired pay under this subsection shall receive 
        retired pay during any period of retirement from service as a 
        special trial judge--
                    ``(A) at a rate equal to the rate of the salary 
                payable to a special trial judge during such period, if 
                the individual had at least 10 years of service as a 
                special trial judge before retirement, and
                    ``(B) at a rate equal to \1/2\ the rate described 
                in subparagraph (A), if the individual had fewer than 
                10 years of service as a special trial judge before 
                retirement.
            ``(3) Beginning date and payment.--Retired pay under this 
        subsection shall begin to accrue on the day following the date 
        on which the individual's salary as a special trial judge 
        ceases to accrue, and shall continue to accrue during the 
        remainder of such individual's life. Retired pay under this 
        subsection shall be paid in the same manner as the salary of a 
        special trial judge.
            ``(4) Partial years.--In computing the rate of the retired 
        pay for an individual to whom paragraph (1) applies, any 
        portion of the aggregate number of years such individual has 
        served as a special trial judge which is a fractional part of 1 
        year shall be eliminated if it is less than 6 months, or shall 
        be counted as a full year if it is 6 months or more.
            ``(5) Recalled service.--In computing the rate of the 
        retired pay for an individual to whom paragraph (1) applies, 
        any period during which such individual performs services under 
        subsection (c) on a substantially full-time basis shall be 
        treated as a period during which such individual has served as 
        a special trial judge.
    ``(e) Election to Receive Retired Pay.--Any special trial judge may 
elect to receive retired pay under subsection (d). Such an election--
            ``(1) may be made only while an individual is a special 
        trial judge (except that in the case of an individual who fails 
        to be reappointed as a special trial judge, such election may 
        be made within 60 days after such individual leaves office as a 
        special trial judge),
            ``(2) once made, shall be irrevocable, and
            ``(3) shall be made by filing notice thereof in writing 
        with the chief judge.
The chief judge shall transmit to the Office of Personnel Management a 
copy of each notice filed with the chief judge under this subsection.
    ``(f) Other Rules Made Applicable.--The rules of subsections (f), 
(g), (h), (i), and (j) of section 7447 shall apply to a special trial 
judge in the same manner as a judge of the Tax Court. For purposes of 
the preceding sentence, any reference to the President in such 
subsections shall be applied as if it were a reference to the chief 
judge.''.
    (b) Conforming Amendments.--
            (1) Section 3121(b)(5)(E) is amended by inserting ``or 
        special trial judge'' before ``of the United States Tax 
        Court''.
            (2) Section 7448(b)(2) is amended to read as follows:
            ``(2) Special trial judges.--Any special trial judge may by 
        written election filed with the chief judge elect the 
        application of this section. Such election shall be filed while 
        such individual is a special trial judge.''.
            (3) Section 210(a)(5)(E) of the Social Security Act (42 
        U.S.C. 410(a)(5)(E)) is amended by inserting ``or special trial 
        judge'' before ``of the United States Tax Court''.
    (c) Clerical Amendment.--The table of sections for part I of 
subchapter C of chapter 76 is amended by inserting after the item 
relating to section 7447 the following new item:

``Sec. 7447A. Retirement for special trial judges.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

                      TITLE XI--REVENUE PROVISIONS

SEC. 1101. SIMPLE AND SEP ROTH IRAS.

    (a) In General.--Section 408A is amended by striking subsection 
(f).
    (b) Rules Relating to Simplified Employee Pensions.--
            (1) Contributions.--Section 402(h)(1) is amended by 
        striking ``and'' at the end of subparagraph (A), by striking 
        the period at the end of subparagraph (B) and inserting ``, 
        and'', and by adding at the end the following new subparagraph:
                    ``(C) in the case of any contributions pursuant to 
                a simplified employer pension which are made to an 
                individual retirement plan designated as a Roth IRA, 
                such contribution shall not be excludable from gross 
                income.''.
            (2) Distributions.--Section 402(h)(3) is amended by 
        inserting ``, or section 408A(d) in the case of an individual 
        retirement plan designated as a Roth IRA'' before the period at 
        the end.
            (3) Election required.--Section 408(k) is amended by 
        redesignating paragraphs (7), (8), and (9) as paragraphs (8), 
        (9), and (10), respectively, and by inserting after paragraph 
        (6) the following new paragraph:
            ``(7) Roth contribution election.--An individual retirement 
        plan which is designated as a Roth IRA shall not be treated as 
        a simplified employee pension under this subsection unless the 
        employee elects for such plan to be so treated (at such time 
        and in such manner as the Secretary may provide).''.
    (c) Rules Relating to Simple Retirement Accounts.--
            (1) Election required.--Section 408(p), as amended by this 
        Act, is further amended by adding at the end the following new 
        paragraph:
            ``(13) Roth contribution election.--An individual 
        retirement plan which is designated as a Roth IRA shall not be 
        treated as a simple retirement account under this subsection 
        unless the employee elects for such plan to be so treated (at 
        such time and in such manner as the Secretary may provide).''.
            (2) Rollovers.--Section 408A(e) is amended by adding at the 
        end the following new paragraph:
            ``(3) Simple retirement accounts.--In the case of any 
        payment or distribution out of a simple retirement account (as 
        defined in section 408(p)) with respect to which an election 
        has been made under section 408(p)(13) and to which 72(t)(6)(A) 
        applies, the term `qualified rollover contribution' shall not 
        include any payment or distribution paid into an account other 
        than another simple retirement account (as so defined).''.
    (d) Coordination With Roth Contribution Limitation.--Section 
408A(c) is amended by adding at the end the following new paragraph:
            ``(7) Coordination with limitation for simple retirement 
        plans and seps.--In the case of an individual on whose behalf 
        contributions are made to a simple retirement account or a 
        simplified employee pension, the amount described in paragraph 
        (2)(A) shall be increased by an amount equal to the 
        contributions made on the individual's behalf to such account 
        or pension for the taxable year, but only to the extent such 
        contributions--
                    ``(A) in the case of a simplified retirement 
                account--
                            ``(i) do not exceed the sum of the dollar 
                        amount in effect for the taxable year under 
                        section 408(p)(2)(A)(ii) and the employer 
                        contribution required under subparagraph 
                        (A)(iii) or (B)(i), as the case may be, of 
                        section 408(p)(2), and
                            ``(ii) do not cause the elective deferrals 
                        (as defined in section 402(g)(3)) on behalf of 
                        such individual to exceed the limitation under 
                        section 402(g)(1) (taking into account any 
                        additional elective deferrals permitted under 
                        section 414(v)), or
                    ``(B) in the case of a simplified employee pension, 
                do not exceed the limitation in effect under section 
                408(j).''.
    (e) Conforming Amendment.--Section 408A(d)(2)(B) is amended by 
inserting ``, or employer in the case of a simple retirement account 
(as defined in section 408(p)) or simplified employee pension (as 
defined in section 408(k)),'' after ``individual's spouse''.
    (f) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2023.

SEC. 1102. ELECTIVE DEFERRALS GENERALLY LIMITED TO REGULAR CONTRIBUTION 
              LIMIT.

    (a) Applicable Employer Plans.--Section 414(v) is amended by adding 
at the end the following new paragraphs:
            ``(7) Certain deferrals must be roth contributions.--
                    ``(A) In general.--Except as provided in 
                subparagraph (C), in the case of an eligible 
                participant whose wages (as defined in section 3121(a)) 
                for the preceding year exceed $100,000, paragraph (1) 
                shall apply only if any additional elective deferrals 
                are designated Roth contributions (as defined in 
                section 402A(c)(1)).
                    ``(B) Roth option.--In the case of an applicable 
                employer plan with respect to which subparagraph (A) 
                applies to any participant for a plan year, paragraph 
                (1) shall not apply to the plan unless the plan 
                provides that any eligible participant may make the 
                participant's additional elective deferrals as 
                designated Roth contributions.
                    ``(C) Exception.--Subparagraph (A) shall not apply 
                in the case of an applicable employer plan described in 
                paragraph (6)(A)(iv).
                    ``(D) Election to change deferrals.--The Secretary 
                may provide by regulations that an eligible participant 
                may elect to change the participant's election to make 
                additional elective deferrals if the participant's 
                compensation is determined to exceed the limitation 
                under subparagraph (A) after the election is made.
            ``(8) No recharacterization of excess deferrals.--If the 
        elective deferrals for any year of an eligible participant to 
        which paragraph (7)(A) applies exceed any applicable limitation 
        under this title (without regard to paragraph (1)) or the terms 
        of the plan, such excess shall not be treated as additional 
        elective deferrals to which paragraph (1) applies.''.
    (b) Conforming Amendments.--
            (1) Section 402(g)(1) is amended by striking subparagraph 
        (C).
            (2) Section 457(e)(18)(A)(ii) is amended by inserting ``the 
        lesser of any designated Roth contributions made by the 
        participant to the plan or'' before ``the applicable dollar 
        amount''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2023.

SEC. 1103. OPTIONAL TREATMENT OF EMPLOYER MATCHING OR NONELECTIVE 
              CONTRIBUTIONS AS ROTH CONTRIBUTIONS.

    (a) In General.--Section 402A(a) is amended by redesignating 
paragraph (2) as paragraph (4), by striking ``and'' at the end of 
paragraph (1), and by inserting after paragraph (1) the following new 
paragraphs:
            ``(2) any designated Roth contribution which is made by the 
        employer to the program on the employee's behalf on account of 
        the employee's contribution, elective deferral, or (subject to 
        the requirements of section 401(m)(14)) qualified student loan 
        payment shall be treated as a matching contribution for 
        purposes of this chapter, except that such contribution shall 
        not be excludable from gross income,
            ``(3) any designated Roth contribution which is made by the 
        employer to the program on the employee's behalf and which is a 
        nonelective contribution shall be fully vested and shall not be 
        excludable from gross income, and''.
    (b) Matching Included in Qualified Roth Contribution Program.--
Section 402A(b)(1) is amended--
            (1) by inserting ``, or to have made on the employee's 
        behalf,'' after ``elect to make'', and
            (2) by inserting ``, or of matching contributions or 
        nonelective contributions which may otherwise be made on the 
        employee's behalf,'' after ``otherwise eligible to make''.
    (c) Designated Roth Matching Contributions.--Section 402A(c)(1) is 
amended by inserting ``, matching contribution, or nonelective 
contribution'' after ``elective deferral''.
    (d) Matching Contribution Defined.--Section 402A(e) is amended by 
adding at the end the following:
            ``(3) Matching contribution.--The term `matching 
        contribution' means--
                    ``(A) any matching contribution described in 
                section 401(m)(4)(A), and
                    ``(B) any contribution to an eligible deferred 
                compensation plan (as defined in section 457(b)) by an 
                eligible employer described in section 457(e)(1)(A) on 
                behalf of an employee and on account of such employee's 
                elective deferral under such plan,
        but only if such contribution is fully vested at the time 
        received.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to contributions made after December 31, 2022.

SEC. 1104. CHARITABLE CONSERVATION EASEMENTS.

    (a) In General.--Section 170(h) is amended by adding at the end the 
following new paragraph:
            ``(7) Limitation on deduction for qualified conservation 
        contributions made by pass-through entities.--
                    ``(A) In general.--A contribution by a partnership 
                (whether directly or as a distributive share of a 
                contribution of another partnership) shall not be 
                treated as a qualified conservation contribution for 
                purposes of this section if the amount of such 
                contribution exceeds 2.5 times the sum of each 
                partner's relevant basis in such partnership.
                    ``(B) Relevant basis.--For purposes of this 
                paragraph--
                            ``(i) In general.--The term `relevant 
                        basis' means, with respect to any partner, the 
                        portion of such partner's modified basis in the 
                        partnership which is allocable (under rules 
                        similar to the rules of section 755) to the 
                        portion of the real property with respect to 
                        which the contribution described in 
                        subparagraph (A) is made.
                            ``(ii) Modified basis.--The term `modified 
                        basis' means, with respect to any partner, such 
                        partner's adjusted basis in the partnership as 
                        determined--
                                    ``(I) immediately before the 
                                contribution described in subparagraph 
                                (A),
                                    ``(II) without regard to section 
                                752, and
                                    ``(III) by the partnership after 
                                taking into account the adjustments 
                                described in subclauses (I) and (II) 
                                and such other adjustments as the 
                                Secretary may provide.
                    ``(C) Exception for contributions outside 3-year 
                holding period.--Subparagraph (A) shall not apply to 
                any contribution which is made at least 3 years after 
                the latest of--
                            ``(i) the last date on which the 
                        partnership that made such contribution 
                        acquired any portion of the real property with 
                        respect to which such contribution is made,
                            ``(ii) the last date on which any partner 
                        in the partnership that made such contribution 
                        acquired any interest in such partnership, and
                            ``(iii) if the interest in the partnership 
                        that made such contribution is held through 1 
                        or more partnerships--
                                    ``(I) the last date on which any 
                                such partnership acquired any interest 
                                in any other such partnership, and
                                    ``(II) the last date on which any 
                                partner in any such partnership 
                                acquired any interest in such 
                                partnership.
                    ``(D) Exception for family partnerships.--
                            ``(i) In general.--Subparagraph (A) shall 
                        not apply with respect to any contribution made 
                        by any partnership if substantially all of the 
                        partnership interests in such partnership are 
                        held, directly or indirectly, by an individual 
                        and members of the family of such individual.
                            ``(ii) Members of the family.--For purposes 
                        of this subparagraph, the term `members of the 
                        family' means, with respect to any individual--
                                    ``(I) the spouse of such 
                                individual, and
                                    ``(II) any individual who bears a 
                                relationship to such individual which 
                                is described in subparagraphs (A) 
                                through (G) of section 152(d)(2).
                    ``(E) Application to other pass-through entities.--
                Except as may be otherwise provided by the Secretary, 
                the rules of this paragraph shall apply to S 
                corporations and other pass-through entities in the 
                same manner as such rules apply to partnerships.
                    ``(F) Regulations.--The Secretary shall prescribe 
                such regulations or other guidance as may be necessary 
                or appropriate to carry out the purposes of this 
                paragraph, including regulations or other guidance--
                            ``(i) to require reporting, including 
                        reporting related to tiered partnerships and 
                        the modified basis of partners, and
                            ``(ii) to prevent the avoidance of the 
                        purposes of this paragraph.''.
    (b) Application of Accuracy-related Penalties.--
            (1) In general.--Section 6662(b) is amended by inserting 
        after paragraph (9) the following new paragraph:
            ``(10) Any disallowance of a deduction by reason of section 
        170(h)(7).''.
            (2) Treatment as gross valuation misstatement.--Section 
        6662(h)(2) is amended by striking ``and'' at the end of 
        subparagraph (B), by striking the period at the end of 
        subparagraph (C) and inserting ``, and'', and by adding at the 
        end the following new subparagraph:
                    ``(D) any disallowance of a deduction described in 
                subsection (b)(10).''.
            (3) No reasonable cause exception.--Section 6664(c)(2) is 
        amended by inserting ``or to any disallowance of a deduction 
        described in section 6662(b)(10)'' before the period at the 
        end.
            (4) Approval of assessment not required.--Section 
        6751(b)(2)(A) is amended by striking ``subsection (b)(9)'' and 
        inserting ``paragraph (9) or (10) of subsection (b)''.
    (c) Extension of Statute of Limitations for Listed Transactions.--
Any contribution described in section 170(h)(7)(A) of the Internal 
Revenue Code of 1986 (as added by this section) shall be treated for 
purposes of sections 6501(c)(10) and 6235(c)(6) of such Code as a 
transaction specifically identified by the Secretary as a tax avoidance 
transaction for purposes of section 6011 of such Code.
    (d) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to contributions made after the date of the enactment of 
        this Act.
            (2) No inference.--No inference is intended as to the 
        appropriate treatment of contributions made in taxable years 
        ending on or before the date specified in paragraph (1), or as 
        to any activity not described in section 170(h)(7) of the 
        Internal Revenue Code of 1986, as added by this section.
                                                       Calendar No. 480

117th CONGRESS

  2d Session

                                S. 4808

                          [Report No. 117-142]

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