H.R. 2756 (112th): Individual Recovery Assistance Act of 2011

112th Congress, 2011–2013. Text as of Aug 01, 2011 (Introduced).

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I

112th CONGRESS

1st Session

H. R. 2756

IN THE HOUSE OF REPRESENTATIVES

August 1, 2011

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 waive the 10 percent penalty on distributions from qualified retirement plans for mortgage payments on qualified residences and in respect of unemployment and to increase the age at which distributions from qualified retirement plans are required to begin from 701/2 to 75.

1.

Short title

This Act may be cited as the Individual Recovery Assistance Act of 2011.

2.

Moratorium on penalty for early distributions from qualified retirement plans

(a)

In general

Paragraph (2) of section 72(t) of the Internal Revenue Code of 1986 is amended by adding at the end the following:

(H)

Recovery distributions

In the case of distributions on or after the date of the enactment of this subparagraph and before the end of the 1-year period beginning on such date, any qualified recovery distribution.

.

(b)

Qualified recovery distribution

Subsection (t) of section 72 of such Code is amended by adding at the end the following new paragraph:

(11)

Qualified recovery distribution

For purposes of paragraph (2)(H)—

(A)

In general

The term qualified recovery distribution means any distribution which is—

(i)

a qualified mortgage distribution, or

(ii)

a qualified unemployment distribution.

(B)

Qualified mortgage distribution distributions

For purposes of subparagraph (A), the term qualified mortgage distribution means a distribution to the extent that the aggregate distributions for the taxable year do not exceed the aggregate payments of the taxpayer for the taxable year for principal, interest, escrow for real estate taxes and property insurance, and mortgage insurance with respect to any residence that is a qualified residence (as defined in section 163(h)(4)(A)) of the taxpayer for the taxable year.

(C)

Qualified unemployment distribution

For purposes of subparagraph (A)—

(i)

In general

The term qualified unemployment distribution means a distribution to an individual after separation from employment if—

(I)

such individual has received unemployment compensation for 12 consecutive weeks under any Federal or State unemployment compensation law by reason of such separation, and

(II)

such distribution is made during any taxable year during which such unemployment compensation is paid or the succeeding taxable year.

(ii)

Distributions after reemployment and self-employed individuals

Rules similar to the rules of clauses (ii) and (iii) of paragraph (2)(D) shall apply.

(D)

Coordination

Distributions shall not be taken into account under subparagraph (A) if such distributions are described in subparagraph (A), (C), (D), (E), (F), or (G) of paragraph (2) or to the extent paragraph (1) does not apply to such distributions by reason of paragraph (2)(B).

.

(c)

Effective date

The amendments made by this section shall apply to distributions on or after the date of the enactment of this Act.

3.

Increase in age for required distributions

(a)

In general

Subparagraphs (B)(iv)(I) and (C) of section 401(a)(9) of the Internal Revenue Code of 1986 are amended by striking 70½ each place it occurs and inserting 75.

(b)

Conforming amendments

(1)

Section 219(d)(1) of such Code is amended by striking 70½ in the heading and the text and inserting 75.

(2)

Section 408(b) of such Code is amended by striking 70½ and inserting 75.

(3)

408(d)(8)(B)(ii) of such Code is amended by striking 70½ and inserting 75.

(4)

408A(c)(4) of such Code is amended by striking 70½ in the heading and the text and inserting 75.

(5)

Section 457(d)(1)(A)(i) of such Code is amended by striking 70½ and inserting 75.

(c)

Effective date

The amendments made by this subsection shall apply to years beginning after the date of the enactment of this Act.