A bill to amend the Internal Revenue Code of 1986 to terminate required minimum distributions under tax-favored retirement plans.

II 116TH CONGRESS 2D SESSION S. 3557 To amend the Internal Revenue Code of 1986 to terminate required minimum distributions under tax-favored retirement plans. IN THE SENATE OF THE UNITED STATES MARCH 21, 2020 Mr. PAUL introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to terminate required minimum distributions under tax-favored retire- ment plans. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. TERMINATION OF REQUIRED MINIMUM DIS- 3 TRIBUTION RULES. 4 (a) IN GENERAL.—Section 401(a)(9) of the Internal 5 Revenue Code of 1986 is amended by adding at the end 6 the following new subparagraph: 7 ‘‘(I) TERMINATION OF MINIMUM REQUIRED 8 DISTRIBUTION.—The requirements of this para- 9 VerDate Sep 11 2014 03:52 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S3557.IS S3557 kjohnson on DSK79L0C42PROD with BILLS 2 •S 3557 IS graph shall not apply for any calendar year 1 after 2019.’’. 2 (b) ELIGIBLE ROLLOVER DISTRIBUTIONS.—The last 3 sentence of section 402(c)(4) of the Internal Revenue 4 Code of 1986 is amended to read as follows: ‘‘If all or 5 any portion of a distribution after December 31, 2019, 6 is treated as an eligible rollover distribution but would not 7 be so treated if the minimum distribution requirements 8 under section 401(a)(9) had applied during the year of 9 the distribution, such distribution shall not be treated as 10 an eligible rollover distribution for purposes of section 11 401(a)(31) or 3405(c) or subsection (f) of this section.’’. 12 (c) EFFECTIVE DATES.— 13 (1) IN GENERAL.—The amendments made by 14 this section shall apply for calendar years beginning 15 after December 31, 2019. 16 (2) PROVISIONS RELATING TO PLAN OR CON- 17 TRACT AMENDMENTS.— 18 (A) IN GENERAL.—If this paragraph ap- 19 plies to any pension plan or contract amend- 20 ment, such pension plan or contract shall not 21 fail to be treated as being operated in accord- 22 ance with the terms of the plan during the pe- 23 riod described in subparagraph (B)(ii) solely be- 24 VerDate Sep 11 2014 03:52 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S3557.IS S3557 kjohnson on DSK79L0C42PROD with BILLS 3 •S 3557 IS cause the plan operates in accordance with this 1 section. 2 (B) AMENDMENTS TO WHICH PARAGRAPH 3 APPLIES.— 4 (i) IN GENERAL.—This paragraph 5 shall apply to any amendment to any pen- 6 sion plan or annuity contract which— 7 (I) is made pursuant to the 8 amendments made by this section, 9 and 10 (II) is made on or before the last 11 day of the first plan year beginning 12 on or after January 1, 2022. 13 In the case of a governmental plan, sub- 14 clause (II) shall be applied by substituting 15 ‘‘2023’’ for ‘‘2022’’. 16 (ii) CONDITIONS.—This paragraph 17 shall not apply to any amendment unless 18 during the period beginning on the effec- 19 tive date of the amendment and ending on 20 December 31, 2020, the plan or contract is 21 operated as if such plan or contract 22 amendment were in effect. 23 Æ VerDate Sep 11 2014 03:52 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6301 E:\BILLS\S3557.IS S3557 kjohnson on DSK79L0C42PROD with BILLS