Instructions: In this task, you are given text for US Congressional and California state bills, your task is to generate a summary for this bill.
Input: SECTION 1. LIFETIME SAVINGS ACCOUNTS.

(a) In General.--Subchapter F of Chapter 1 of the Internal Revenue
Code of 1986 (relating to exempt organizations) is amended by adding at
the end the following new part:

''PART IX--LIFETIME SAVINGS ACCOUNTS

''SEC. 530A. LIFETIME SAVINGS ACCOUNTS.

''(a) General Rule.--A Lifetime Savings Account shall be exempt
from taxation under this subtitle. Notwithstanding the preceding
sentence, such account shall be subject to the taxes imposed by section
511 (relating to imposition of tax on unrelated business income of
charitable organizations).
''(b) Lifetime Savings Account.--For purposes of this section, the
term 'Lifetime Savings Account' means a trust created or organized in
the United States for the exclusive benefit of an individual or his
beneficiaries and which is designated (in such manner as the Secretary
shall prescribe) at the time of the establishment of the trust as a
Lifetime Savings Account, but only if the written governing instrument
creating the trust meets the following requirements:
''(1) Except in the case of a qualified rollover
contribution described in subsection (d)--
''(A) no contribution will be accepted unless it is
in cash, and
''(B) contributions will not be accepted for the
calendar year in excess of the contribution limit
specified in subsection (c)(1).
''(2) The trustee is a bank (as defined in section 408(n))
or another person who demonstrates to the satisfaction of the
Secretary that the manner in which that person will administer
the trust will be consistent with the requirements of this
section or who has so demonstrated with respect to any
individual retirement plan.
''(3) No part of the trust assets will be invested in life
insurance contracts.
''(4) The interest of an individual in the balance of his
account is nonforfeitable.
''(5) The assets of the trust shall not be commingled with
other property except in a common trust fund or common
investment fund.
''(c) Treatment of Contributions and Distributions.--
''(1) Contribution limit.--
''(A) In general.--The aggregate amount of
contributions (other than qualified rollover
contributions described in subsection (d)) for any
calendar year to all Lifetime Savings Accounts
maintained for the benefit of an individual shall not
exceed $5,000.
''(B) Cost-of-living adjustment.--
''(i) In general.--In the case of any
calendar year after 2005, the $5,000 amount
under subparagraph (A) 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,
determined by substituting 'calendar
year 2004' for 'calendar year 1992' in
subparagraph (B) thereof.
''(ii) Rounding rules.--If any amount after
adjustment under clause (i) is not a multiple
of $500, such amount shall be rounded to the
next lower multiple of $500.
''(2) Distributions.--Any distribution from a Lifetime
Savings Account shall not be includible in gross income.
''(d) Qualified Rollover Contribution.--For purposes of this
section, the term 'qualified rollover contribution' means a
contribution to a Lifetime Savings Account--
''(1) from another such account of the same beneficiary,
but only if such amount is contributed not later than the 60th
day after the distribution from such other account,
''(2) from a Lifetime Savings Account of a spouse of the
beneficiary of the account to which the contribution is made,
but only if such amount is contributed not later than the 60th
day after the distribution from such other account, and
''(3) before January 1, 2006, from--
''(A) a qualified tuition program pursuant to
section 529(c)(3)(E), or
''(B) a Coverdell education savings account
pursuant to section 530(d)(9).
''(e) Loss of Taxation Exemption of Account Where Beneficiary
Engages in Prohibited Transaction.--Rules similar to the rules of
paragraph (2) of section 408(e) shall apply to any Lifetime Savings
Account.
''(f) Custodial Accounts.--For purposes of this section, a
custodial account or an annuity contract issued by an insurance company
qualified to do business in a State shall be treated as a trust under
this section if--
''(1) the custodial account or annuity contract would,
except for the fact that it is not a trust, constitute a trust
which meets the requirements of subsection (b), and
''(2) in the case of a custodial account, the assets of
such account are held by a bank (as defined in section 408(n))
or another person who demonstrates, to the satisfaction of the
Secretary, that the manner in which he will administer the
account will be consistent with the requirements of this
section.
For purposes of this title, in the case of a custodial account or
annuity contract treated as a trust by reason of the preceding
sentence, the person holding the assets of such account or holding such
annuity contract shall be treated as the trustee thereof.
''(g) Reports.--The trustee of a Lifetime Savings Account shall
make such reports regarding such account to the Secretary and to the
beneficiary of the account with respect to contributions,
distributions, and such other matters as the Secretary may require. The
reports required by this subsection shall be filed at such time and in
such manner and furnished to such individuals at such time and in such
manner as may be required.''.
(b) Tax on Excess Contributions.--
(1) In general.--Subsection (a) of section 4973 of the
Internal Revenue Code of 1986 (relating to tax on excess
contributions to certain tax-favored accounts and annuities) is
amended by striking ''or'' at the end of paragraph (4), by
inserting ''or'' at the end of paragraph (5), and by inserting after
paragraph (5) the following new paragraph:
''(6) a Lifetime Savings Account (as defined in section
530A),''.
(2) Excess contribution.--Section 4973 of such Code is
amended by adding at the end the following new subsection:
''(h) Excess Contributions to Lifetime Savings Accounts.--For
purposes of this section--
''(1) In general.--In the case of Lifetime Savings Accounts
(within the meaning of section 530A), the term 'excess
contributions' means the sum of--
''(A) the amount by which the amount contributed
for the calendar year to such accounts (other than
qualified rollover contributions (as defined in section
530A(d))) exceeds the contribution limit under section
530A(c)(1), and
''(B) the amount determined under this subsection
for the preceding calendar year, reduced by the excess
(if any) of the maximum amount allowable as a
contribution under section 530A(c)(1) for the calendar
year over the amount contributed to the accounts for
the calendar year.
''(2) Special rule.--A contribution shall not be taken into
account under paragraph (1) if such contribution (together with
the amount of net income attributable to such contribution) is
returned to the beneficiary before July 1 of the year following
the year in which the contribution is made.''.
(c) Failure To Provide Reports on Lifetime Savings Accounts.--
Paragraph (2) of section 6693(a) of the Internal Revenue Code of 1986
(relating to failure to provide reports on individual retirement
accounts or annuities) is amended by striking ''and'' at the end of
subparagraph (D), by striking the period at the end of subparagraph (E)
and inserting '', and'', and by adding at the end the following new
subparagraph:
''(F) section 530A(g) (relating to Lifetime Savings
Accounts).''.
(d) Rollovers From Certain Other Tax-Free Accounts.--
(1) Qualified state tuition plans.--Paragraph (3) of
section 529(c) of the Internal Revenue Code of 1986 (relating
to distributions) is amended by adding at the end the following
new subparagraph:
''(E) Rollovers to lifetime savings accounts.--
''(i) In general.--Subparagraph (A) shall
not apply to the qualified portion of any
distribution which, before January 1, 2006, and
within 60 days of such distribution, is
transferred to a Lifetime Savings Account
(within the meaning of section 530A) of the
designated beneficiary. This subparagraph shall
only apply to distributions in accordance with
the previous sentence from an account which was
in existence with respect to such designated
beneficiary on December 31, 2003.
''(ii) Qualified portion.--For purposes of
this subparagraph, the term 'qualified portion'
means the amount equal to the sum of--
''(I) the lesser of $50,000 or the
amount which is in the account of the
designated beneficiary on December 31,
2003,
''(II) any contributions to such
account for the taxable year beginning
after December 31, 2004, and before
January 1, 2005, and
''(III) any earnings of such
account for such year.
''(iii) Limitation.--The sum of the amounts
taken into account under clause (ii)(II) with
respect to all accounts of the designated
beneficiary plus any amounts with respect to
such designated beneficiary taken into account
under section 530(d)(9)(B)(ii) shall not exceed
the sum of $5,000 plus the earnings
attributable to such amounts.''.
(2) Coverdell education savings accounts.--Subsection (d)
of section 530 of such Code (relating to tax treatment of
distributions) is amended by inserting at the end the following
new paragraph:
''(9) Rollovers to lifetime savings accounts.--
''(A) In general.--Paragraph (1) shall not apply to
the qualified portion of any amount paid or distributed
from a Coverdell education savings account to the
extent that the amount received is paid, before January
1, 2006, and not later than the 60th day after the date
of such payment or distribution, into a Lifetime
Savings Account (within the meaning of section 530A)
for the benefit of the same beneficiary. This paragraph
shall only apply to amounts paid or distributed in
accordance with the preceding sentence from an account
which was in existence with respect to such beneficiary
on December 31, 2003.
''(B) Qualified portion.--For purposes of this
paragraph, the term 'qualified portion' means the
amount equal to the sum of--
''(i) the amount which is in the account of
the beneficiary on December 31, 2003,
''(ii) any contributions to such account
for the taxable year beginning after December
31, 2004, and before January 1, 2005, and
''(iii) any earnings of such account for
such year.
''(C) Limitation.--The sum of the amounts taken
into account under subparagraph (B)(ii) with respect to
all accounts of the beneficiary plus any amounts with
respect to such beneficiary taken into account under
section 529(c)(3)(E)(ii)(II) shall not exceed the sum
of $5,000 plus the earnings attributable to such
amounts.''.
(e) Conforming Amendment.--The table of parts for subchapter F of
chapter 1 of the Internal Revenue Code of 1986 is amended by adding at
the end the following new item:

''Part IX. Lifetime Savings Accounts.''.

(f) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2004.
Output:
Amends the Internal Revenue Code to create a tax-exempt trust to be known as a "Lifetime Savings Account" for the benefit of an individual taxpayer or his beneficiaries. Allows an individual taxpayer to make cash contributions up to $5,000 each year to such trusts. Prohibits: (1) investment of trust assets in life insurance contracts; and (2) commingling of trust assets with any other property except in a common trust or investment fund. Provides for an annual cost-of-living adjustment to the contribution amount.

Excludes from gross income distributions from such a trust. Allows tax-free rollovers to a trust from: (1) another account of the trust beneficiary if the rollover from such other account is completed within 60 days of the date of distribution; (2) from a Lifetime Savings Account of the spouse of the trust beneficiary if the rollover from the spouse's account is completed within 60 days of the date of distribution; (3) from a qualified state tuition plan or a Coverdell education savings account before January 1, 2006.