HR 4143 IHCommentsClose CommentsPermalink

112th CONGRESSCommentsClose CommentsPermalink

2d SessionCommentsClose CommentsPermalink

H. R. 4143CommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to extend the period during which transfers of excess pension assets may be made to retiree health accounts and to provide for the transfer of such assets to retiree group term life insurance accounts.CommentsClose CommentsPermalink

IN THE HOUSE OF REPRESENTATIVESCommentsClose CommentsPermalink

March 5, 2012CommentsClose CommentsPermalink

Mr. TIBERI (for himself and Mr. PASCRELL) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Education and the Workforce, 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 concernedCommentsClose CommentsPermalink

A BILLCommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to extend the period during which transfers of excess pension assets may be made to retiree health accounts and to provide for the transfer of such assets to retiree group term life insurance accounts.CommentsClose CommentsPermalink

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

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Extension of Section 420 and Retiree Life Insurance Act of 2012’.CommentsClose CommentsPermalink

SEC. 2. EXTENSION FOR TRANSFERS OF EXCESS PENSION ASSETS TO RETIREE HEALTH ACCOUNTS.

(a) In General- Paragraph (5) of section 420(b) of the Internal Revenue Code of 1986 is amended by striking ‘December 31, 2013’ and inserting ‘December 31, 2021’.CommentsClose CommentsPermalink





(b) Conforming ERISA Amendments-CommentsClose CommentsPermalink





(1) Sections 101(e)(3), 403(c)(1), and 408(b)(13) of the Employee Retirement Income Security Act of 1974 are each amended by striking ‘Pension Protection Act of 2006’ and inserting ‘Extension of Section 420 and Retiree Life Insurance Act of 2012’.CommentsClose CommentsPermalink





(2) Section 408(b)(13) of such Act (29 U.S.C. 1108(b)(13)) is amended by striking ‘January 1, 2014’ and inserting ‘January 1, 2022’.CommentsClose CommentsPermalink





(c) Effective Date- The amendments made by this Act shall take effect on the date of the enactment of this Act.CommentsClose CommentsPermalink

SEC. 3. TRANSFER OF EXCESS PENSION ASSETS TO RETIREE GROUP TERM LIFE INSURANCE ACCOUNTS.

(a) In General- Subsection (a) of section 420 of the Internal Revenue Code of 1986 is amended by inserting ‘, or an applicable life insurance account,’ after ‘health benefits account’.CommentsClose CommentsPermalink





(b) Applicable Life Insurance Account Defined-CommentsClose CommentsPermalink





(1) IN GENERAL- Subsection (e) of section 420 of the Internal Revenue Code of 1986 is amended by redesignating paragraphs (4) and (5) as paragraphs (5) and (6), respectively, and by inserting after paragraph (3) the following new paragraph:CommentsClose CommentsPermalink





‘(4) APPLICABLE LIFE INSURANCE ACCOUNT- The term ‘applicable life insurance account’ means a separate account established and maintained for amounts transferred under this section for qualified current retiree liabilities based on premiums for applicable life insurance benefits.’.CommentsClose CommentsPermalink





(2) APPLICABLE LIFE INSURANCE BENEFITS DEFINED- Paragraph (1) of section 420(e) of such Code is amended by redesignating subparagraph (D) as subparagraph (E) and by inserting after subparagraph (C) the following new subparagraph:CommentsClose CommentsPermalink





‘(D) APPLICABLE LIFE INSURANCE BENEFITS- The term ‘applicable life insurance benefits’ means group-term life insurance coverage provided to retired employees who, immediately before the qualified transfer, are entitled to receive such coverage by reason of retirement and who are entitled to pension benefits under the plan, but only to the extent that such coverage is provided under a policy for retired employees and the cost of such coverage is excludable from the retired employee’s gross income under section 79.’.CommentsClose CommentsPermalink





(3) COLLECTIVELY BARGAINED LIFE INSURANCE BENEFITS DEFINED-CommentsClose CommentsPermalink





(A) IN GENERAL- Paragraph (6) of section 420(f) of such Code is amended by redesignating subparagraph (D) as subparagraph (E) and by inserting after subparagraph (C) the following new subparagraph:CommentsClose CommentsPermalink





‘(D) COLLECTIVELY BARGAINED LIFE INSURANCE BENEFITS- The term ‘collectively bargained life insurance benefits’ means, with respect to any collectively bargained transfer--CommentsClose CommentsPermalink





‘(i) applicable life insurance benefits which are provided to retired employees who, immediately before the transfer, are entitled to receive such benefits by reason of retirement, andCommentsClose CommentsPermalink





‘(ii) if specified by the provisions of the collective bargaining agreement governing the transfer, applicable life insurance benefits which will be provided at retirement to employees who are not retired employees at the time of the transfer.’.CommentsClose CommentsPermalink





(B) CONFORMING AMENDMENTS-CommentsClose CommentsPermalink





(i) Clause (i) of section 420(e)(1)(C) of such Code is amended by striking ‘upon retirement’ and inserting ‘by reason of retirement’.CommentsClose CommentsPermalink





(ii) Subparagraph (C) of section 420(f)(6) of such Code is amended--CommentsClose CommentsPermalink





(I) by striking ‘which are provided to’ in the matter preceding clause (i),CommentsClose CommentsPermalink





(II) by inserting ‘which are provided to’ before ‘retired employees’ in clause (i),CommentsClose CommentsPermalink





(III) by striking ‘upon retirement’ in clause (i) and inserting ‘by reason of retirement’, andCommentsClose CommentsPermalink





(IV) by striking ‘active employees who, following their retirement,’ and inserting ‘which will be provided at retirement to employees who are not retired employees at the time of the transfer and who’.CommentsClose CommentsPermalink





(c) Maintenance of Effort-CommentsClose CommentsPermalink





(1) IN GENERAL- Subparagraph (A) of section 420(c)(3) of the Internal Revenue Code of 1986 is amended by inserting ‘, and each group-term life insurance plan under which applicable life insurance benefits are provided,’ after ‘health benefits are provided’.CommentsClose CommentsPermalink





(2) CONFORMING AMENDMENTS-CommentsClose CommentsPermalink





(A) Subparagraph (B) of section 420(c)(3) of such Code is amended--CommentsClose CommentsPermalink





(i) by redesignating subclauses (I) and (II) of clause (i) as subclauses (II) and (III) of such clause, respectively, and by inserting before subclause (II) of such clause, as so redesignated, the following new subclause:CommentsClose CommentsPermalink





‘(I) separately with respect to applicable health benefits and applicable life insurance benefits,’, andCommentsClose CommentsPermalink





(ii) by striking ‘for applicable health benefits’ and all that follows in clause (ii) and inserting ‘was provided during such taxable year for the benefits with respect to which the determination under clause (i) is made.’.CommentsClose CommentsPermalink





(B) Subparagraph (C) of section 420(c)(3) of such Code is amended--CommentsClose CommentsPermalink





(i) by inserting ‘for applicable health benefits’ after ‘applied separately’, andCommentsClose CommentsPermalink





(ii) by inserting ‘, and separately for applicable life insurance benefits with respect to individuals age 65 or older at any time during the taxable year and with respect to individuals under age 65 during the taxable year’ before the period.CommentsClose CommentsPermalink





(C) Subparagraph (E) of section 420(c)(3) of such Code is amended--CommentsClose CommentsPermalink





(i) in clause (i), by inserting ‘or retiree life insurance coverage, as the case may be,’ after ‘retiree health coverage’,CommentsClose CommentsPermalink





(ii) in clause (ii), by inserting ‘FOR RETIREE HEALTH COVERAGE’ after ‘COST REDUCTIONS’ in the heading thereof, andCommentsClose CommentsPermalink





(iii) in clause (ii)(II), by inserting ‘with respect to applicable health benefits’ after ‘liabilities of the employer’.CommentsClose CommentsPermalink





(D) Paragraph (2) of section 420(f) of such Code is amended by striking ‘collectively bargained retiree health liabilities’ each place it occurs and inserting ‘collectively bargained retiree liabilities’.CommentsClose CommentsPermalink





(E) Clause (i) of section 420(f)(2)(D) of such Code is amended--CommentsClose CommentsPermalink





(i) by inserting ‘, and each group-term life insurance plan or arrangement under which applicable life insurance benefits are provided,’ in subclause (I) after ‘applicable health benefits are provided’,CommentsClose CommentsPermalink





(ii) by inserting ‘or applicable life insurance benefits, as the case may be,’ in subclause (I) after ‘provides applicable health benefits’,CommentsClose CommentsPermalink





(iii) by striking ‘group health’ in subclause (II), andCommentsClose CommentsPermalink





(iv) by inserting ‘or collectively bargained life insurance benefits’ in subclause (II) after ‘collectively bargained health benefits’.CommentsClose CommentsPermalink





(F) Clause (ii) of section 420(f)(2)(D) of such Code is amended--CommentsClose CommentsPermalink





(i) by inserting ‘with respect to applicable health benefits or applicable life insurance benefits’ after ‘requirements of subsection (c)(3)’, andCommentsClose CommentsPermalink





(ii) by adding at the end the following: ‘Such election may be made separately with respect to applicable health benefits and applicable life insurance benefits. In the case of an election with respect to applicable life insurance benefits, the first sentence of this clause shall be applied as if subsection (c)(3) as in effect before the amendments made by such Act applied to such benefits.’.CommentsClose CommentsPermalink





(G) Clause (iii) of section 420(f)(2)(D) of such Code is amended--CommentsClose CommentsPermalink





(i) by striking ‘retiree’ each place it occurs, andCommentsClose CommentsPermalink





(ii) by inserting ‘, collectively bargained life insurance benefits, or both, as the case may be,’ after ‘health benefits’ each place it occurs.CommentsClose CommentsPermalink





(d) Coordination With Section 79- Section 79 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:CommentsClose CommentsPermalink





‘(f) Exception for Life Insurance Purchased in Connection With Qualified Transfer of Excess Pension Assets- Subsection (b)(3) and section 72(m)(3) shall not apply in the case of any cost paid (whether directly or indirectly) with assets held in an applicable life insurance account (as defined in section 420(e)(4)) under a defined benefit plan.’.CommentsClose CommentsPermalink





(e) Conforming Amendments-CommentsClose CommentsPermalink





(1) Section 420 of the Internal Revenue Code of 1986 is amended by striking ‘qualified current retiree health liabilities’ each place it appears and inserting ‘qualified current retiree liabilities’.CommentsClose CommentsPermalink





(2) Section 420 of such Code is amended by inserting ‘, or an applicable life insurance account,’ after ‘a health benefits account’ each place it appears in subsection (b)(1)(A), subparagraphs (A), (B)(i), and (C) of subsection (c)(1), subsection (d)(1)(A), and subsection (f)(2)(E)(ii).CommentsClose CommentsPermalink





(3) Section 420(b) of such Code is amended--CommentsClose CommentsPermalink





(A) by adding the following at the end of paragraph (2)(A): ‘If there is a transfer from a defined benefit plan to both a health benefits account and an applicable life insurance account during any taxable year, such transfers shall be treated as 1 transfer for purposes of this paragraph.’, andCommentsClose CommentsPermalink





(B) by inserting ‘to an account’ after ‘may be transferred’ in paragraph (3).CommentsClose CommentsPermalink





(4) The heading for section 420(c)(1)(B) of such Code is amended by inserting ‘OR LIFE INSURANCE’ after ‘HEALTH BENEFITS’.CommentsClose CommentsPermalink





(5) Paragraph (1) of section 420(e) of such Code is amended--CommentsClose CommentsPermalink





(A) by inserting ‘and applicable life insurance benefits’ in subparagraph (A) after ‘applicable health benefits’, andCommentsClose CommentsPermalink





(B) by striking ‘HEALTH’ in the heading thereof.CommentsClose CommentsPermalink





(6) Subparagraph (B) of section 420(e)(1) of such Code is amended--CommentsClose CommentsPermalink





(A) in the matter preceding clause (i), by inserting ‘(determined separately for applicable health benefits and applicable life insurance benefits)’ after ‘shall be reduced by the amount’,CommentsClose CommentsPermalink





(B) in clause (i), by inserting ‘or applicable life insurance accounts’ after ‘health benefit accounts’, andCommentsClose CommentsPermalink





(C) in clause (i), by striking ‘qualified current retiree health liability’ and inserting ‘qualified current retiree liability’.CommentsClose CommentsPermalink





(7) The heading for subsection (f) of section 420 of such Code is amended by striking ‘Health’ each place it occurs.CommentsClose CommentsPermalink





(8) Subclause (II) of section 420(f)(2)(B)(ii) of such Code is amended by inserting ‘or applicable life insurance account, as the case may be,’ after ‘health benefits account’.CommentsClose CommentsPermalink





(9) Subclause (III) of section 420(f)(2)(E)(i) of such Code is amended--CommentsClose CommentsPermalink





(A) by inserting ‘defined benefit’ before ‘plan maintained by an employer’, andCommentsClose CommentsPermalink





(B) by inserting ‘health’ before ‘benefit plans maintained by the employer’.CommentsClose CommentsPermalink





(10) Paragraphs (4) and (6) of section 420(f) of such Code are each amended by striking ‘collectively bargained retiree health liabilities’ each place it occurs and inserting ‘collectively bargained retiree liabilities’.CommentsClose CommentsPermalink





(11) Subparagraph (A) of section 420(f)(6) of such Code is amended--CommentsClose CommentsPermalink





(A) in clauses (i) and (ii), by inserting ‘, in the case of a transfer to a health benefits account,’ before ‘his covered spouse and dependents’, andCommentsClose CommentsPermalink





(B) in clause (ii), by striking ‘health plan’ and inserting ‘plan’.CommentsClose CommentsPermalink





(12) Subparagraph (B) of section 420(f)(6) of such Code is amended--CommentsClose CommentsPermalink





(A) in clause (i), by inserting ‘, and collectively bargained life insurance benefits,’ after ‘collectively bargained health benefits’,CommentsClose CommentsPermalink





(B) in clause (ii)--CommentsClose CommentsPermalink





(i) by adding at the end the following: ‘The preceding sentence shall be applied separately for collectively bargained health benefits and collectively bargained life insurance benefits.’, andCommentsClose CommentsPermalink





(ii) by inserting ‘, applicable life insurance accounts,’ after ‘health benefit accounts’, andCommentsClose CommentsPermalink





(C) by striking ‘HEALTH’ in the heading thereof.CommentsClose CommentsPermalink





(13) Subparagraph (E) of section 420(f)(6) of such Code, as redesignated by subsection (b), is amended--CommentsClose CommentsPermalink





(A) by striking ‘bargained health’ and inserting ‘bargained’,CommentsClose CommentsPermalink





(B) by inserting ‘, or a group-term life insurance plan or arrangement for retired employees,’ after ‘dependents’, andCommentsClose CommentsPermalink





(C) by striking ‘HEALTH’ in the heading thereof.CommentsClose CommentsPermalink





(14) Section 101(e) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1021(e)) is amended--CommentsClose CommentsPermalink





(A) in paragraphs (1) and (2), by inserting ‘or applicable life insurance account’ after ‘health benefits account’ each place it appears, andCommentsClose CommentsPermalink





(B) in paragraph (1), by inserting ‘or applicable life insurance benefit liabilities’ after ‘health benefits liabilities’.CommentsClose CommentsPermalink





(f) Technical Correction- Clause (iii) of section 420(f)(6)(B) is amended by striking ‘416(I)(1)’ and inserting ‘416(i)(1)’.CommentsClose CommentsPermalink





(g) Repeal of Deadwood-CommentsClose CommentsPermalink





(1) Subparagraph (A) of section 420(b)(1) of the Internal Revenue Code of 1986 is amended by striking ‘in a taxable year beginning after December 31, 1990’.CommentsClose CommentsPermalink





(2) Subsection (b) of section 420 of such Code is amended by striking paragraph (4) and by redesignating paragraph (5), as amended by this Act, as paragraph (4).CommentsClose CommentsPermalink





(3) Paragraph (2) of section 420(b) of such Code, as amended by this section, is amended--CommentsClose CommentsPermalink





(A) by striking subparagraph (B), andCommentsClose CommentsPermalink





(B) by striking ‘PER YEAR- ’ and all that follows through ‘No more than’ and inserting ‘PER YEAR- No more than’.CommentsClose CommentsPermalink





(4) Paragraph (2) of section 420(c) of such Code is amended--CommentsClose CommentsPermalink





(A) by striking subparagraph (B),CommentsClose CommentsPermalink





(B) by moving subparagraph (A) two ems to the left, andCommentsClose CommentsPermalink





(C) by striking ‘BEFORE TRANSFER- ’ and all that follows through ‘The requirements of this paragraph’ and inserting the following: ‘BEFORE TRANSFER- The requirements of this paragraph’.CommentsClose CommentsPermalink





(5) Paragraph (2) of section 420(d) of such Code is amended by striking ‘after December 31, 1990’.CommentsClose CommentsPermalink





(h) Effective Date-CommentsClose CommentsPermalink





(1) IN GENERAL- The amendments made by this section shall apply to transfers made after the date of the enactment of this Act.CommentsClose CommentsPermalink





(2) CONFORMING AMENDMENTS RELATING TO PENSION PROTECTION ACT- The amendments made by subsections (b)(3)(B) and (f) shall take effect as if included in the amendments made by section 841(a) of the Pension Protection Act of 2006.CommentsClose CommentsPermalink