110 HR 3868 IH: To provide an orderly transition to new requirements, and for other purposes. U.S. House of Representatives 2007-10-17 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I 110th CONGRESS 1st Session H. R. 3868 IN THE HOUSE OF REPRESENTATIVES October 17, 2007 Mr. Pomeroy (for himself and Mr. Cantor) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Education and Labor, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To provide an orderly transition to new requirements, and for other purposes.

1.

Delay of effective dates for single-employer plan funding rules

(a)

In general

(1)

Delayed effective dates

The sections of the Pension Protection Act of 2006, the Internal Revenue Code of 1986, and the Employee Retirement Income Security Act of 1974 specified in paragraph (3) are amended— (A)by striking 2007 and inserting, the applicable funding pre-effective date year (as defined in section 1305 of the Pension Protection Act of 2006), (B)by striking 2008 and inserting the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006), (C)by striking 2009 and inserting the calendar year after the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006), (D)by striking 2010 and inserting the calendar year that is two years after the applicable effective date year (as defined in section 1305 of the Pension Protection Act of 2006), (E)by striking 2011 and inserting the calendar year that is three years after the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006), and (F)by striking 2012 and inserting the calendar year that is four years after the applicable funding effective year (as defined in section 1305 of the Pension Protection Act of 2006). (2)

Applicable funding effective date years

Title XIII of the Pension Protection Act of 2006 is amended by adding at the end the following new section:

1305.

Applicable funding effective dates

(a)

In general

(1)For purposes of this Act, except as otherwise provided in this section, the term applicable funding pre-effective date year means 2008. (2)For purposes of this Act, the term applicable funding effective date year means the calendar year immediately following the applicable funding pre-effective date year. (b)

Exception

Subsection (a)(1) shall apply only if final regulations are issued by June 30, 2008, with respect to sections 206(g), 303(f), 303(g)(3), 303(h)(2), 303(h)(3), 303(i)(4)(A)(ii), and 303(j)(3)(A) of the Employee Retirement Income Security Act of 1974 and sections 430(f), 430(g)(3), 430(h)(2), 430(h)(3), 430(i)(4)(A)(ii), 430(j)(3)(A), and 436 of the Internal Revenue Code of 1986. If final regulations under all such sections are not issued by June 30, 2008, for purposes of this Act, the term applicable funding pre-effective date year shall mean the first calendar year with respect to which all such final regulations are issued by June 30 of such year. (c)

Effective date

This section shall take effect on the date of the enactment of this Act.

. (3)

Applicable sections

(A)

Pension Protection Act of 2006

The amendments made in paragraph (1) shall apply to the following sections of the Pension Protection Act of 2006: 101(d), 102(c), 103(c), 104(b), 105(b), 106(b), 107(e), 111(b), 112(b), 113(b), 115(a), 115(b)(3), 115(e)(2), 302(c), 401(a)(2), 402(b)(1), 505(c), and 802(b). (B)

Internal revenue code of 1986

The amendments made in paragraph (1) shall apply to the following sections of the Internal Revenue Code of 1986: 417(e)(3), 430(c)(5), 430(f)(1)(B)(ii)(I),430(f)(3)(C), 430(f)(6)(C)(i), 430(f)(7)(C)(i), 430(h)(2)(G), 430(i)(4)(B), 430(i)(5)(C), 436(j), and 436(k). (C)

Employee Retirement Income Security Act of 1974

The amendments made in paragraph (1) shall apply to the following sections of the Employee Retirement Income Security Act of 1974: 205(g)(3), 206(g)(9), 206(g)(10), 303(c)(5), 303(f)(1)(B)(ii)(I), 303(f)(3)(C), 303(f)(6)(C)(i), 303(f)(7)(C)(i), 303(h)(2)(G), 303(i)(4)(B), 303(i)(5)(C), and 4041(b)(5)(C)(i). (b)

Extension of replacement of 30-year treasury rates

(1)

Amendments of ERISA

(A)

Determination of range

Subclause (II) of section 302(b)(5)(B)(ii) of the Employee Retirement Income Security Act of 1974 is amended— (i)by striking January 1, 2008 and inserting January 1 of the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006), and (ii)in the heading, by striking for years 2004, 2005, 2006, and 2007. (B)

Determination of current liability

Subclause (IV) of section 302(d)(7)(C)(i) of such Act is amended— (i)by striking in 2004, 2005, 2006, or 2007 and inserting after 2003 and before the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006), and (ii)in the heading, by striking for years 2004, 2005, 2006, and 2007. (C)

PBGC premium rate

Subclause (V) of section 4006(a)(3)(E)(iii) of such Act is amended by striking January 1, 2008 and inserting January 1 of the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006). (2)

Amendments of internal revenue code

(A)

Determination of range

Subclause (II) of section 412(b)(5)(B)(ii) of the Internal Revenue Code of 1986 is amended— (i)by striking January 1, 2008 and inserting January 1 of the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006), and (ii)in the heading, by striking for years 2004, 2005, 2006, and 2007. (B)

Determination of current liability

Subclause (IV) of section 412(1)(7)(C)(i) of such Code is amended— (i)by striking in 2004, 2005, 2006, and 2007 and inserting after 2003 and before the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006), and (ii)in the heading, by striking for years 2004, 2005, 2006, and 2007. (3)

Plan amendments

Clause (ii) of section 101(c)(2)(A) of the Pension Funding Equity Act of 2004 is amended by striking January 1, 2008 and inserting January 1 of the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006). (c)

Conforming amendments regarding transition rule

(1)

In general

Paragraph (1) of section 115(d) of the Pension Protection Act of 2006 is amended to read as follows: (1)

In general

Section 769(c)(3) of the Retirement Protection Act of 1994, as added by section 201 of the Pension Funding Equity Act of 2004, is amended by striking in 2004 and 2005 and inserting after 2003 and before the applicable funding effective date year (as defined in section 1305 of the Pension Protection Act of 2006).. (2)

Heading

The heading of subsection (d) of section 115 of such Act is amended by striking for 2006 and 2007. (d)

Conforming amendments regarding funding notice

(1)

In general

Paragraph (1) of section 501(d) of the Pension Protection Act of 2006 is amended to read as follows: (1)

In general

Except as provided in paragraph (2), the amendments made by this section shall apply to plan years beginning after December 31 of the applicable funding pre-effective date year (as defined in section 1305 of this Act), or, in the case of a multiemployer plan, plan years beginning after December 31, 2007.. (2)

Repeal of notice

Subsection (d) of section 501 of such Act is amended by redesignating paragraph (2) as paragraph (3), and by inserting after paragraph (1) the following new paragraph: (2)

Repeal of notice

The amendment made by subsection (b) shall apply to plan years beginning after December 31, 2006.. (3)

Transition rule

Paragraph (3) of section 501(d) of such Act, as redesignated, is amended— (A)by adding or, in the case of a single-employer plan, before January 1 of the applicable funding effective date year (as defined in section 1305 of this Act) after 2008,, (B)by striking 2006 and inserting 2006 or, in the case of a single-employer plan, before the applicable funding pre-effective date year (as defined in section 1305 of this Act), (C)by striking 2007 and inserting the applicable funding pre-effective date year (as defined in section 1305 of this Act), (D)by striking or funded percentage the second place it appears, (E)by striking may provide. and inserting may provide, and, (F)by adding at the end the following: (C)in the case of a plan year beginning in 2007, the funded percentage as determined using such methods of estimation as the Secretary of the Treasury may provide.. (e)

Conforming amendments regarding additional annual reporting requirements

Subsection (f) of section 503 of the Pension Protection Act of 2006 is amended to read as follows: (f)

Effective date

(1)

In general

Except as otherwise provided in paragraph (2), the amendments made by this section shall apply to plan years beginning after the applicable funding pre-effective date year (as defined in section 1305 of this Act). (2)

Multiemployer plans

With respect to multiemployer plans, the amendments made by this section shall apply to plan years beginning after December 31, 2007.. (f)

Conforming amendments regarding plan amendments

(1)

In general

Subparagraph (B) of section 1107(b)(1) of the Pension Protection Act of 2006 is amended by striking January 1, 2009 and inserting January 1 of the calendar year after the applicable funding effective date year (as defined in section 1305 of this Act). (2)

Governmental plans

Paragraph (1) of section 1107(b) of such Act is amended to read as follows: (1)In the case of a governmental plan (as defined in section 414(d) of the Internal Revenue Code of 1986), subparagraph (B) shall be applied as if it read: on or before the last day of the first plan year beginning on or after January 1 of the calendar year that is three years after the applicable funding effective date year (as defined in section 1305 of this Act).. (g)

Conforming amendments regarding deduction limits

(1)

In general

Paragraph (1) of section 801(f) of the Pension Protection Act of 2006, as redesignated by paragraph (4), is amended— (A)by striking paragraph (2) and inserting paragraphs (2) and (3), and (B)by striking December 31, 2007 and inserting December 31 of the applicable funding pre-effective date year (as defined in section 1305 of this Act). (2)

Multiemployer plans

Subsection (f) of section 801 of such Act, as redesignated by paragraph (4), is amended by redesignating paragraph (2) as paragraph (3) and by inserting after paragraph (1) the following new paragraph: (2)

Multiemployer plans

Except as provided in paragraph (3), with respect to multiemployer plans, the amendments made by this section shall apply to years beginning after December 31, 2007.. (3)

Special rule

Paragraph (3) of section 801(d) of such Act, as redesignated, is amended by adding at the end the following: The amendments made by subsection (e) shall apply to years beginning after December 31, 2007, and before January 1 of the applicable funding effective date year (as defined in section 1305 of this Act).. (4)

Conforming amendments

(A)

In general

Subparagraph (D) of section 404(a)(1) of the Internal Revenue Code of 1986 (as amended by the Pension Protection Act of 2006 other than section 802 of such Act) is amended by adding at the end the following: (v)

Multiemployer plans

In the case of a defined benefit plan which is a multiemployer plan, except as provided in regulations, the maximum amount deductible under the limitations of this paragraph shall not be less than the excess (if any) of— (I)140 percent of the current liability of the plan determined under section 431(c)(6)(C), over (II)the value of the plan’s assets determined under section 431(c)(2).. (B)

Single-employer plans

Subparagraph (D) of section 404(a)(1) of such Code is amended— (i)by inserting after defined benefit plan in clause (i) the following (other than a multiemployer plan), (ii)by striking (140 percent in the case of a multiemployer plan) in clause (i), and (iii)by striking clause (i) in clause (iv) and inserting clauses (i) and (v). (h)

Conforming amendment regarding commercial airlines

Paragraph (2) of section 402(a) of the Pension Protection Act of 2006 is amended by adding at the end the following: In the case of an election under this paragraph, such sections shall apply with respect to such plan sponsor based on the effective date provisions in effect immediately before the enactment of section 1305 of this Act..

2.

Effective date

The amendments made by this Act shall take effect as if included in the enactment of the Pension Protection Act of 2006.