H.R. 1779 and it's potential effects on Defined Benefit Plans?

[Guest fcdeacy]

Does anyone know if this bill will have an impact on Defined Benefit Plans? If so, what if anything do we need to do in order to make sure we are in compliance????

Thanks,

Fred

[MGB]

The biggest thing you need to follow for being in compliance is whether it even passes (if it does, it would have a lot more than what is in it now).

It will not be addressed this year. Most likely there will be an attempt to make it part of other pension bills next year, but doubtful passage because there are only a handful (one hand) of members in Congress that support it. The Administration has been slowly backing off of its support, too, now that the people who originally came up with this (e.g., Assist. Sec. of Treasury Pam Olsen) are no longer working in the government.

[AndyH]

Well, that is terrific news, if Olsen is gone. I missed that one. Maybe it's her turn to tour with Bono?

[david rigby]

Well, that is terrific news, if Olsen is gone.

Why?

[AndyH]

As I understand it, she was the proponent of the surprise legislation last year while Paul O'Neil was "away". Remember the ERSA, LSA, etc. version 1 that would have wiped out everything but DB plans? And it was apparently proposed without consulting the "in crowd" on the Hill regarding such matters.

Mike Preston called it the "actuaries full employment act" but many others had different words for it.

How can anybody forget this:

http://benefitslink.com/boards/index.php?s...opic=18329&st=0

[Guest RobO]

MGB.....Just curious, but your comments on Pam Olsen being an originator of this bill makes me wonder if you are thinking of HR 1776.....HR 1779 would waive the 10% penalty for early distributions taken from IRAs and other retirement plans if the individual has served for active duty in the military for 179 days; as well as allow for a "repayment" period of two years. As a temporary bill (expiring on 9/12/05) that is meant to provide relief for members of the armed forces in Iraq and Afghanistan, I'd be surprised if the Administration was actually backing off its support.

[MGB]

Oops, sorry. I go out of the country for a week and lose track of all of the references floating around in the back of my head. The original posting didn't say what the subject was, and I haven't focused on the military relief in relation to an HR number yet. (Haven't even gotten around to reading it.)

My comments were on the bill concerning LSAs, etc. (but it isn't 1776 - that was Portman-Cardin).

The military relief is expected to pass easily this year.

[Guest fcdeacy]

so, does anyone think that DB Plans will be affected by this proposed legislation? i read it and only saw reference to 401(k), 403(b), IRA's and the like.......

any input would be greatly appreciated!

Thanks,

Fred

[Guest RobO]

I don't think that DB plans would be affected. The legislation only covers distributions from an IRA or amounts attributable to employee elective deferrals under 402(g)(3)(A) or ©, or 501©(18)(D)(iii), which generally apply to 401(k)'s and 403(b)'s.......I'm far more involved with DC plans, though, so I'd also be interested in hearing any differing opinions. (Maybe plans with old, pre-TRA '86 deductible employee contributions????....I'm really reaching on that one.)