[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1142 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 1142

    To amend the Internal Revenue Code of 1986 to permit farmers to 
 rollover into an individual retirement account the proceeds from the 
                            sale of a farm.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           February 25, 1993

 Mr. Costello 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 permit farmers to 
 rollover into an individual retirement account the proceeds from the 
                            sale of a farm.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Farmer Retirement Security Act''.

SEC. 2. ROLLOVER OF PROCEEDS FROM SALE OF FARM INTO INDIVIDUAL 
              RETIREMENT ACCOUNT.

    (a) In General.--Subpart A of part I of subchapter D of chapter 1 
of the Internal Revenue Code of 1986 (relating to pension, profit-
sharing, stock bonus plans, etc.) is amended by inserting after section 
408 the following new section:

``SEC. 408A. ROLLOVER TREATMENT FOR PROCEEDS FROM SALE OF FARM.

    ``(a) In General.--In the case of an individual, gross income does 
not include gain from the sale or exchange of qualified farm property 
to the extent of the amounts which the individual, not later than the 
60th day after the date of the sale or exchange, pays into an 
individual retirement account (within the meaning of section 408(a)) 
for the benefit of the individual (or spouse of the individual).
    ``(b) Qualified farm property.--For purposes of this section--
            ``(1) In general.--The term `qualified farm property' means 
        real or personal property located in the United States if, 
        during the 5-year period ending on the date of the sale or 
        exchange of the property--
                    ``(A) the property was used for farming purposes, 
                and
                    ``(B) there was material participation by the 
                individual (or spouse of the individual) in the 
                operation of the farm.
            ``(2) Farm.--The terms `farm' and `farming purposes' have 
        the respective meanings given such terms by paragraphs (4) and 
        (5) of section 2032A(e).
            ``(3) Applicable rules.--Rules similar to the rules of 
        paragraphs (3) and (6) of section 2032A(e) shall apply.
    ``(c) Limitations.--
            ``(1) Maximum rollover per individual.--The amount which 
        may be excluded from gross income under subsection (a) in any 
        taxable year on account of payments into an individual 
        retirement account for the benefit of any 1 individual shall 
        not exceed--
                    ``(A) the amount determined by multiplying--
                            ``(i) the sum of the dollar limitations 
                        applicable for such taxable year under sections 
                        402(g)(1) and 408(a)(1), by
                            ``(ii) the holding period of the individual 
                        with respect to the property, reduced by
                    ``(B) the aggregate amount excluded under 
                subsection (a) with respect to the individual for all 
                preceding taxable years.
            ``(2) Maximum rollover per family.--The aggregate amount 
        which may be excluded from gross income under subsection (a) in 
        any taxable year by any individual (and spouse of the 
        individual) shall not exceed--
                    ``(A) $500,000, reduced by
                    ``(B) the sum of--
                            ``(i) the amount by which the aggregate 
                        value of the assets held by the individual (and 
                        spouse) in individual retirement plans exceeds 
                        $100,000, and
                            ``(ii) the aggregate amount excluded under 
                        subsection (a) by the individual (and spouse) 
                        for all preceding taxable years.
    ``(d) Treatment of Investment.--For purposes of section 72, any 
amount excluded from gross income under subsection (a) on account of a 
payment into an individual retirement account shall be treated as an 
amount allowed as a deduction under section 219 with respect to the 
individual retirement account.''
    (b) Denial of Deduction for Rollover Amount.--Paragraph (2) of 
section 219(d) of such Code (relating to denial of deduction for 
recontributed amounts) is amended by striking ``or 408(d)(3)'' and 
inserting ``408(d)(3), or 408A''.
    (c) Exemption From Contribution Limitations.--
            (1) Paragraph (1) of section 408(a) of such Code (relating 
        to limitation on contributions to individual retirement 
        accounts) is amended by striking ``or 403(b)(8)'' and inserting 
        ``403(b)(8), or 408A''.
            (2) Subparagraph (A) of section 4973(b)(1) of such Code 
        (relating to tax on excess contributions to individual 
        retirement accounts) is amended by striking ``or 408(d)(3)'' 
        and inserting ``408(d)(3), or 408A''.
    (d) Effective Date.--The amendments made by this section shall 
apply to sales or exchanges after the date of the enactment of this 
Act.

                                 <all>