[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3741 Introduced in House (IH)]







109th CONGRESS
  1st Session
                                H. R. 3741

   To amend the Internal Revenue Code to allow a one-time emergency, 
    penalty free withdrawal, from a qualified investment retirement 
                                account.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 13, 2005

 Mr. Davis of Kentucky (for himself and Mr. Pickering) introduced the 
 following bill; which was referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code to allow a one-time emergency, 
    penalty free withdrawal, from a qualified investment retirement 
                                account.

    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 ``Disaster Victims' Savings Access 
Act''.

SEC. 2. WAIVER OF EARLY WITHDRAWAL PENALTY.

    The Internal Revenue Code Section 72(t)(2) (26 U.S.C. 72(t)(2)) is 
amended by adding at the end the following new subparagraph:
                    ``(G) Disaster and emergency.--
                            ``(i) A one time distribution to an 
                        employee whose domicile, place of business, or 
                        principal place of employment is located in a 
                        county enumerated in a Presidentially declared 
                        disaster or emergency.
                                    ``(I) A qualified distribution as 
                                defined in section 72(t)(2)(G)(i) is 
                                limited to fifty percent of the amount 
                                in the qualified retirement plan 
                                account of $250,000, whichever is 
                                greater.
                            ``(ii) Notwithstanding any other section of 
                        the Internal Revenue Code, a qualified 
                        distribution as defined in section 
                        72(t)(2)(G)(i) and satisfying the requirement 
                        in section 72(t)(2)(G)(i)(I) shall be divided 
                        evenly over five years for the purpose of 
                        assessing tax on gross income as defined in 
                        section 61.
                            ``(iii) A qualified distribution as defined 
                        in section 72(t)(2)(G)(i) is only permitted 
                        within three years of the date of the 
                        Presidential declaration.
                            ``(iv) Presidentially declared disaster.--
                        For purposes of this subsection, the term 
                        `Presidentially declared disaster' means any 
                        Presidential declaration as defined within the 
                        Robert T. Stafford Disaster Relief and 
                        Emergency Assistance Act.''.

SEC. 3. CATCH-UP ALLOWED.

    (a) The Internal Revenue Code section 414(v) (26 U.S.C. 414(v)) is 
amended by adding ``and survivors of disasters'' after ``Catch-up 
contributions for individuals age 50 or over''.
    (b) The Internal Revenue Code section 414(v) (26 U.S.C. 414(v)) is 
amended by adding at the end the following new subparagraph:
            ``(7) Disaster victim eligible.--
                    ``(A) Notwithstanding any other provision of the 
                Internal Revenue Code, a plan participant who received 
                a qualified distribution under section 72(t)(2)(G) is 
                eligible to re-contribute the full amount withdrawn 
                within five years from the distribution. If, after five 
                years, the plan participant has not re-contributed the 
                full amount, the plan participant may continue to make 
                catch-up contributions in the same manner and subject 
                to the same rules as a plan participant age 50 or over 
                until such time as the amount of the emergency 
                withdrawal has been re-contributed.
                            ``(i) This eligibility for catch-up 
                        contributions is limited to the amount of the 
                        qualified distribution the plan participant 
                        received under section 72(t)(2)(G).''.

SEC. 4. EFFECTIVE DATE.

    The provisions of this Act shall take effect on the day of 
enactment.
                                 <all>