[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1094 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 1094

      To amend the Internal Revenue Code of 1986 to provide that 
 distributions to involuntarily unemployed individuals from individual 
retirement accounts will not be subject to the additional tax on early 
                             distributions.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           February 24, 1993

  Mr. Dixon (for himself, Mr. Rangel, Mrs. Maloney, Mr. Hilliard, Mr. 
 Dellums, Mr. Frank of Massachusetts, Ms. Woolsey, Mr. Jefferson, Mr. 
 Minge, Mr. Kopetski, Mr. Frost, Mr. Hobson, Mr. Barrett of Wisconsin, 
and Mr. Gunderson) 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 that 
 distributions to involuntarily unemployed individuals from individual 
retirement accounts will not be subject to the additional tax on early 
                             distributions.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled, That (a) paragraph (2) 
of section 72(t) of the Internal Revenue Code of 1986 (relating to 
exceptions) is amended by adding at the end thereof the following new 
subparagraph:
                    ``(D) Distributions to involuntarily unemployed 
                individuals.--Any distribution from an individual 
                retirement plan to an individual during any period--
                            ``(i) for which such individual is 
                        receiving unemployment compensation (as defined 
                        in section 85(b)), or
                            ``(ii) for which such individual would have 
                        been entitled to receive unemployment 
                        compensation (as so defined) but for--
                                    ``(I) the termination of the period 
                                during which such compensation was 
                                payable, or
                                    ``(II) an exhaustion of such 
                                individual's rights to such 
                                compensation.''
    (b) Subsection (t) of section 72 of such Code is amended by adding 
at the end thereof the following new paragraph:
            ``(6) Recontribution of certain distributions to 
        involuntarily unemployed.--
                    ``(A) In general.--If an individual received a 
                distribution described in paragraph (2)(D), such 
                individual may recontribute such distribution to an 
                individual retirement plan in the manner provided in 
                this paragraph.
                    ``(B) Method of making recontribution.--Any 
                recontribution of a distribution described in paragraph 
                (2)(D) received by any individual--
                            ``(i) may be made only during the 1-year 
                        period following the first week of 
                        disqualifying employment after the receipt of 
                        such distribution,
                            ``(ii) shall not exceed the portion of such 
                        distribution which was included in gross income 
                        reduced by any prior recontribution under this 
                        subsection with respect to such distribution, 
                        and
                            ``(iii) shall be made by making a payment 
                        in cash for the benefit of such individual to 
                        an individual retirement plan.
                An individual making a contribution as recontribution 
                under this subsection shall designate (in the manner 
                prescribed by the Secretary) such contribution as a 
                recontribution under this paragraph and shall specify 
                the distribution in respect of which such 
                recontribution is being made.
                    ``(C) Treatment of recontribution.--
                            ``(i) Deduction allowed.--There shall be 
                        allowed as a deduction to an individual making 
                        a recontribution under this paragraph an amount 
                        equal to the amount so recontributed. Such 
                        deduction shall be allowable in computing 
                        adjusted gross income and shall be allowed for 
                        the taxable year in which such recontribution 
                        is made.
                            ``(ii) Treated as rollover contribution.--
                        For purposes of this title, any recontribution 
                        under this subsection shall be treated as a 
                        rollover contribution described in section 
                        403(b)(8).
                    ``(D) Week of disqualifying employment.--For 
                purposes of subparagraph (A), the term `week of 
                disqualifying employment' means any week during which 
                the individual has employment which disqualifies the 
                individual from receiving unemployment compensation or 
                would so disqualify the individual but for a prior 
                exhaustion of the individual's rights to unemployment 
                compensation or termination of the period during which 
                such compensation was payable.''
    (c) The amendments made by this section shall apply to 
distributions made after December 31, 1992.

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