Retirement Plan Modernization Act

I 116TH CONGRESS 2D SESSION H. R. 5676 To increase the amount of accrued benefit which a pension plan may distribute after employee separation. IN THE HOUSE OF REPRESENTATIVES JANUARY 24, 2020 Mr. SABLAN (for himself and Mr. WALBERG) introduced the following bill; which was referred to the Committee on Education and Labor, and in addition to the Committee on Ways and Means, for a period to be subse- quently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To increase the amount of accrued benefit which a pension plan may distribute after employee separation. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Retirement Plan Mod- 4 ernization Act’’. 5 VerDate Sep 11 2014 01:49 Jan 25, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H5676.IH H5676 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 5676 IH SEC. 2. INCREASE IN AMOUNT OF ACCRUED BENEFIT 1 WHICH A PENSION PLAN MAY DISTRIBUTE 2 AFTER EMPLOYEE SEPARATION. 3 (a) AMENDMENTS TO INTERNAL REVENUE CODE OF 4 1986.— 5 (1) IN GENERAL.—Section 411(a)(11)(A) of the 6 Internal Revenue Code of 1986 is amended by strik- 7 ing ‘‘$5,000’’ and inserting ‘‘$8,000’’. 8 (2) INFLATION ADJUSTMENT.—Section 9 411(a)(11) of such Code is amended by adding at 10 the end the following new subparagraph: 11 ‘‘(E) INFLATION ADJUSTMENT.—In the 12 case of any plan year beginning after 2019, the 13 Secretary shall adjust the $8,000 amount in 14 subparagraph (A) at the same time and in the 15 same manner as under section 415(d), except 16 that the base period shall be the calendar quar- 17 ter beginning July 1, 2018, and any increase 18 under this subparagraph which is not a multiple 19 of $50 shall be rounded to the next lowest mul- 20 tiple of $50.’’. 21 (3) CONFORMING AMENDMENTS.— 22 (A) Section 401(a)(31)(B)(ii) of such Code 23 is amended by striking ‘‘$5,000’’ and inserting 24 ‘‘the dollar limit in effect under section 25 411(a)(11)(A)’’. 26 VerDate Sep 11 2014 01:49 Jan 25, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H5676.IH H5676 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 5676 IH (B) Section 411(a)(7)(B)(i) of such Code 1 is amended by striking ‘‘under section 2 411(a)(11)(A)’’ and inserting ‘‘in effect under 3 paragraph (11)(A)’’. 4 (C) Section 457(e)(9)(A)(i) of such Code is 5 amended by inserting ‘‘in effect’’ after ‘‘the dol- 6 lar limit’’. 7 (b) AMENDMENTS TO THE EMPLOYEE RETIREMENT 8 INCOME SECURITY ACT OF 1974.— 9 (1) IN GENERAL.—Section 203(e)(1) of the 10 Employee Retirement Income Security Act of 1974 11 (29 U.S.C. 1053(e)(1)) is amended by striking 12 ‘‘$5,000’’ and inserting ‘‘$8,000’’. 13 (2) INFLATION ADJUSTMENT.—Section 203(e) 14 of such Act (29 U.S.C. 1053(e)) is amended by add- 15 ing at the end the following new paragraph: 16 ‘‘(5) In the case of any plan year beginning 17 after 2019, the Secretary of the Treasury shall ad- 18 just the $8,000 amount in paragraph (1) at the 19 same time and in the same manner as under section 20 415(d) of the Internal Revenue Code of 1986, except 21 that the base period shall be the calendar quarter 22 beginning July 1, 2018, and any increase under this 23 paragraph which is not a multiple of $50 shall be 24 rounded to the next lowest multiple of $50.’’. 25 VerDate Sep 11 2014 01:49 Jan 25, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H5676.IH H5676 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 5676 IH (3) CONFORMING AMENDMENT.—Section 1 204(d)(1) of such Act (29 U.S.C. 1054(d)(1)) is 2 amended by inserting ‘‘in effect’’ after ‘‘the dollar 3 limit’’. 4 (c) EFFECTIVE DATE.—The amendments made by 5 this section shall apply to plan years beginning after the 6 date of the enactment of this Act. 7 Æ VerDate Sep 11 2014 01:49 Jan 25, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\H5676.IH H5676 kjohnson on DSK79L0C42PROD with BILLS