I 111th CONGRESS 2d Session H. R. 6457 IN THE HOUSE OF REPRESENTATIVES November 29, 2010 Mr. McDermott 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 exclude from gross income distributions from individual retirement plans during periods of unemployment in 2009, 2010, and 2011.

1.

Retirement plan distributions while unemployed during 2009, 2010, and 2011 excluded from gross income

(a)

In general

For purposes of the Internal Revenue Code of 1986, gross income shall not include any qualified unemployment distribution. (b)

Qualified unemployment distribution

(1)

In general

For purposes of this section, the term qualified unemployment distribution means any distribution from a qualified retirement plan (as defined in section 4974(c) of such Code) after separation from employment, if— (A)such individual has received unemployment compensation for 12 consecutive weeks under any Federal or State unemployment compensation law by reason of such separation, (B)such distributions are made during any taxable year during which such unemployment compensation is paid or the succeeding taxable year, and (C)such distribution is made after December 31, 2008, and before January 1, 2012. (2)

Distributions after reemployment

Paragraph (1) shall not apply to any distribution made after the individual has been employed for at least 60 days after the separation from employment to which paragraph (1) applies. (3)

Self-employed individuals

To the extent provided in regulations by the Secretary of the Treasury, a self-employed individual shall be treated as meeting the requirements of paragraph (1) if, under Federal or State law, the individual would have received unemployment compensation but for the fact the individual was self-employed. (c)

Effective date

This section shall apply to distributions made after December 31, 2008, in taxable years ending after such date.