Retirement Protection Act

I 116TH CONGRESS 2D SESSION H. R. 6377 To amend the Internal Revenue Code of 1986 to provide for a temporary waiver of required minimum distribution rules for certain retirement plans and accounts, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MARCH 23, 2020 Ms. WEXTON (for herself, Ms. NORTON, Mr. COOPER, Mr. CONNOLLY, Mr. RASKIN, Mr. MEEKS, Mr. BEYER, Mr. LYNCH, Mr. COURTNEY, Mr. KIL- DEE, Mr. KILMER, Mr. ROUDA, Mr. DEFAZIO, Mr. SEAN PATRICK MALONEY of New York, and Ms. HOULAHAN) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to provide for a temporary waiver of required minimum distribution rules for certain retirement plans and accounts, and for other purposes. 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 Protection 4 Act’’. 5 VerDate Sep 11 2014 18:24 Apr 09, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H6377.IH H6377 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 6377 IH SEC. 2. TEMPORARY WAIVER OF REQUIRED MINIMUM DIS- 1 TRIBUTION RULES FOR CERTAIN RETIRE- 2 MENT PLANS AND ACCOUNTS. 3 (a) IN GENERAL.—Section 401(a)(9) of the Internal 4 Revenue Code of 1986 (26 U.S.C. 401) (relating to re- 5 quired distributions) is amended by adding at the end the 6 following new subparagraph: 7 ‘‘(I) TEMPORARY WAIVER OF MINIMUM RE- 8 QUIRED DISTRIBUTIONS.— 9 ‘‘(i) IN GENERAL.—The requirements 10 of this paragraph shall not apply for cal- 11 endar year 2020 to— 12 ‘‘(I) a defined contribution plan 13 which is described in this subsection 14 or in section 403(a) or 403(b), 15 ‘‘(II) a defined contribution plan 16 which is an eligible deferred com- 17 pensation plan described in section 18 457(b) but only if such plan is main- 19 tained by an employer described in 20 section 457(e)(1)(A), or 21 ‘‘(III) an individual retirement 22 plan. 23 ‘‘(ii) SPECIAL RULES REGARDING 24 WAIVER PERIOD.—For purposes of this 25 paragraph— 26 VerDate Sep 11 2014 18:24 Apr 09, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H6377.IH H6377 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 6377 IH ‘‘(I) the required beginning date 1 with respect to any individual shall be 2 determined without regard to this 3 subparagraph for purposes of applying 4 this paragraph for calendar years 5 after 2020, and 6 ‘‘(II) if clause (ii) of subpara- 7 graph (B) applies, the 5-year period 8 described in such clause shall be de- 9 termined without regard to calendar 10 year 2020. 11 ‘‘(iii) AMOUNT DISTRIBUTED MAY BE 12 REPAID.— 13 ‘‘(I) IN GENERAL.—Any indi- 14 vidual who receives a distribution re- 15 quired under this subsection may, at 16 any time during the calendar year 17 2020, make one or more contributions 18 in an aggregate amount not to exceed 19 the amount of such distribution to an 20 eligible retirement plan of which such 21 individual is a beneficiary and to 22 which a rollover contribution of such 23 distribution could be made under sec- 24 tion 402(c), 403(a)(4), 403(b)(8), 25 VerDate Sep 11 2014 18:24 Apr 09, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H6377.IH H6377 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 6377 IH 408(d)(3), or 457(e)(16), as the case 1 may be. 2 ‘‘(II) TREATMENT OF REPAY- 3 MENTS OF DISTRIBUTIONS FROM ELI- 4 GIBLE RETIREMENT PLANS OTHER 5 THAN IRAS.—For purposes of this 6 subparagraph, if a contribution is 7 made pursuant to subclause (I) with 8 respect to a distribution required 9 under this subsection from an eligible 10 retirement plan other than an indi- 11 vidual retirement plan, then the tax- 12 payer shall, to the extent of the 13 amount of the contribution, be treated 14 as having received the waiver in an el- 15 igible rollover distribution (as defined 16 in section 402(c)(4)) and as having 17 transferred the amount to the eligible 18 retirement plan in a direct trustee to 19 trustee transfer within 60 days of the 20 distribution. 21 ‘‘(III) TREATMENT OF REPAY- 22 MENTS FOR DISTRIBUTIONS FROM 23 IRAS.—For purposes of this subpara- 24 graph, if a contribution is made pur- 25 VerDate Sep 11 2014 18:24 Apr 09, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H6377.IH H6377 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 6377 IH suant to subclause (I) with respect to 1 a distribution required under this sub- 2 section from an individual retirement 3 plan (as defined by section 4 7701(a)(37)), then, to the extent of 5 the amount of the contribution, the 6 qualified required distribution shall be 7 treated as a distribution described in 8 section 408(d)(3) and as having been 9 transferred to the eligible retirement 10 plan in a direct trustee to trustee 11 transfer within 60 days of the dis- 12 tribution.’’. 13 (b) ELIGIBLE ROLLOVER DISTRIBUTION.—Section 14 402(c)(4) of the Internal Revenue Code of 1986 (26 15 U.S.C. 402) (defining eligible rollover distribution) is 16 amended by adding at the end the following new flush sen- 17 tence: 18 ‘‘If all or any portion of a distribution during 19 2020 is treated as an eligible rollover distribution 20 but would not be so treated if the minimum distribu- 21 tion requirements under section 401(a)(9) had ap- 22 plied during 2020, such distribution shall not be 23 treated as an eligible rollover distribution for pur- 24 VerDate Sep 11 2014 18:24 Apr 09, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H6377.IH H6377 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 6377 IH poses of section 401(a)(31) or 3405(c) or subsection 1 (f) of this section.’’. 2 (c) EFFECTIVE DATES.— 3 (1) IN GENERAL.—The amendments made by 4 this section shall apply for calendar years beginning 5 after December 31, 2019. 6 (2) PROVISIONS RELATING TO PLAN OR CON- 7 TRACT AMENDMENTS.— 8 (A) IN GENERAL.—If this paragraph ap- 9 plies to any pension plan or contract amend- 10 ment, such pension plan or contract shall not 11 fail to be treated as being operated in accord- 12 ance with the terms of the plan during the pe- 13 riod described in subparagraph (B)(ii) solely be- 14 cause the plan operates in accordance with this 15 section. 16 (B) AMENDMENTS TO WHICH PARAGRAPH 17 APPLIES.— 18 (i) IN GENERAL.—This paragraph 19 shall apply to any amendment to any pen- 20 sion plan or annuity contract which— 21 (I) is made pursuant to the 22 amendments made by this section, 23 and 24 VerDate Sep 11 2014 18:24 Apr 09, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H6377.IH H6377 pamtmann on DSKBC07HB2PROD with BILLS 7 •HR 6377 IH (II) is made on or before the last 1 day of the first plan year beginning 2 on or after January 1, 2022. 3 In the case of a governmental plan, sub- 4 clause (II) shall be applied by substituting 5 ‘‘2023’’ for ‘‘2022’’. 6 (ii) CONDITIONS.—This paragraph 7 shall not apply to any amendment unless 8 during the period beginning on the effec- 9 tive date of the amendment and ending on 10 December 31, 2020, the plan or contract is 11 operated as if such plan or contract 12 amendment were in effect. 13 Æ VerDate Sep 11 2014 18:24 Apr 09, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H6377.IH H6377 pamtmann on DSKBC07HB2PROD with BILLS