[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 9081 Introduced in House (IH)]
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118th CONGRESS
2d Session
H. R. 9081
To provide for emergency tax relief for taxpayers affected by the
severe storms, flooding, straight-line winds, and tornadoes in certain
Iowa counties.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 22, 2024
Mr. Feenstra (for himself, Mr. Nunn of Iowa, Mrs. Hinson, and Mrs.
Miller-Meeks) introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To provide for emergency tax relief for taxpayers affected by the
severe storms, flooding, straight-line winds, and tornadoes in certain
Iowa counties.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Storm Recovery and Community
Restoration Act''.
SEC. 2. SPECIAL DISASTER-RELATED RULES FOR USE OF RETIREMENT FUNDS.
(a) Tax-Favored Withdrawals From Retirement Plans.--
(1) In general.--Section 72(t) of the Internal Revenue Code
of 1986 shall not apply to any qualified Iowa disaster
distribution.
(2) Aggregate dollar limitation.--
(A) In general.--For purposes of this subsection,
the aggregate amount of distributions received by an
individual which may be treated as qualified Iowa
disaster distributions for any taxable year shall not
exceed the excess (if any) of--
(i) $100,000, over
(ii) the aggregate amounts treated as
qualified Iowa disaster distributions received
by such individual for all prior taxable years.
(B) Treatment of plan distributions.--If a
distribution to an individual would (without regard to
subparagraph (A)) be a qualified Iowa disaster
distribution, a plan shall not be treated as violating
any requirement of the Internal Revenue Code of 1986
merely because the plan treats such distribution as a
qualified Iowa disaster distribution, unless the
aggregate amount of such distributions from all plans
maintained by the employer (and any member of any
controlled group which includes the employer) to such
individual exceeds $100,000.
(C) Controlled group.--For purposes of subparagraph
(B), the term ``controlled group'' means any group
treated as a single employer under subsection (b), (c),
(m), or (o) of section 414 of the Internal Revenue Code
of 1986.
(3) Amount distributed may be repaid.--
(A) In general.--Any individual who receives a
qualified Iowa disaster distribution may, at any time
during the 3-year period beginning on the day after the
date on which such distribution was received, make one
or more contributions in an aggregate amount not to
exceed the amount of such distribution to an eligible
retirement plan of which such individual is a
beneficiary and to which a rollover contribution of
such distribution could be made under section 402(c),
403(a)(4), 403(b)(8), 408(d)(3), or 457(e)(16), of the
Internal Revenue Code of 1986, as the case may be.
(B) Treatment of repayments of distributions from
eligible retirement plans other than iras.--For
purposes of the Internal Revenue Code of 1986, if a
contribution is made pursuant to subparagraph (A) with
respect to a qualified Iowa disaster distribution from
an eligible retirement plan other than an individual
retirement plan, then the taxpayer shall, to the extent
of the amount of the contribution, be treated as having
received the qualified Iowa disaster distribution in an
eligible rollover distribution (as defined in section
402(c)(4) of such Code) and as having transferred the
amount to the eligible retirement plan in a direct
trustee to trustee transfer within 60 days of the
distribution.
(C) Treatment of repayments for distributions from
iras.--For purposes of the Internal Revenue Code of
1986, if a contribution is made pursuant to
subparagraph (A) with respect to a qualified Iowa
disaster distribution from an individual retirement
plan (as defined by section 7701(a)(37) of such Code),
then, to the extent of the amount of the contribution,
the qualified Iowa disaster distribution shall be
treated as a distribution described in section
408(d)(3) of such Code and as having been transferred
to the eligible retirement plan in a direct trustee to
trustee transfer within 60 days of the distribution.
(4) Definitions.--For purposes of this subsection--
(A) Qualified iowa disaster distribution.--Except
as provided in paragraph (2), the term ``qualified Iowa
disaster distribution'' means any distribution from an
eligible retirement plan made on or after the
applicable date, and before January 1, 2026, to an
individual whose principal place of abode on the
applicable date, is located in the Iowa disaster area.
(B) Iowa disaster area.--For purposes of paragraph
(1), the term ``Iowa disaster area'' means--
(i) any area within the Iowa counties of
Clarke, Harrison, Mills, Polk, Pottawattamie,
Ringgold, Shelby, or Union with respect to
which a major disaster was declared, during the
period beginning on April 26, 2024, and ending
on the date which is 60 days after the date of
the enactment of this Act, by the President
under section 401 of the Robert T. Stafford
Disaster Relief and Emergency Assistance Act,
and
(ii) any area within the Iowa counties of
Clay, Emmet, Lyon, Plymouth, or Sioux with
respect to which a major disaster was declared,
during the period beginning on June 16, 2024,
and ending on the date which is 60 days after
the date of the enactment of this Act, by the
President under section 401 of the Robert T.
Stafford Disaster Relief and Emergency
Assistance Act.
(C) Applicable date.--For purposes of this
paragraph, the term ``applicable date'' means--
(i) in the case of a disaster area
described in subparagraph (B)(i), April 26,
2024, and
(ii) in the case of a disaster area
described in subparagraph (B)(ii), June 16,
2024.
(D) Eligible retirement plan.--The term ``eligible
retirement plan'' has the meaning given such term by
section 402(c)(8)(B) of the Internal Revenue Code of
1986.
(5) Income inclusion spread over 3-year period.--
(A) In general.--In the case of any qualified Iowa
disaster distribution, unless the taxpayer elects not
to have this paragraph apply for any taxable year, any
amount required to be included in gross income for such
taxable year shall be so included ratably over the 3-
taxable-year period beginning with such taxable year.
(B) Special rule.--For purposes of subparagraph
(A), rules similar to the rules of subparagraph (E) of
section 408A(d)(3) of the Internal Revenue Code of 1986
shall apply.
(6) Special rules.--
(A) Exemption of distributions from trustee to
trustee transfer and withholding rules.--For purposes
of sections 401(a)(31), 402(f), and 3405 of the
Internal Revenue Code of 1986, qualified Iowa disaster
distributions shall not be treated as eligible rollover
distributions.
(B) Qualified iowa disaster distributions treated
as meeting plan distribution requirements.--For
purposes the Internal Revenue Code of 1986, a qualified
Iowa disaster distribution shall be treated as meeting
the requirements of sections 401(k)(2)(B)(i),
403(b)(7)(A)(ii), 403(b)(11), and 457(d)(1)(A) of such
Code.
(b) Recontributions of Withdrawals for Home Purchases.--
(1) Recontributions.--
(A) In general.--Any individual who received a
qualified distribution may, during the period beginning
on the applicable date, and ending on December 31,
2024, make one or more contributions in an aggregate
amount not to exceed the amount of such qualified
distribution to an eligible retirement plan (as defined
in section 402(c)(8)(B) of the Internal Revenue Code of
1986) of which such individual is a beneficiary and to
which a rollover contribution of such distribution
could be made under section 402(c), 403(a)(4),
403(b)(8), or 408(d)(3), of such Code, as the case may
be.
(B) Treatment of repayments.--Rules similar to the
rules of subparagraphs (B) and (C) of subsection (a)(3)
shall apply for purposes of this subsection.
(2) Qualified distribution.--For purposes of this
subsection, the term ``qualified distribution'' means any
distribution--
(A) described in section 401(k)(2)(B)(i)(IV),
403(b)(7)(A)(ii) (but only to the extent such
distribution relates to financial hardship),
403(b)(11)(B), or 72(t)(2)(F), of the Internal Revenue
Code of 1986,
(B) received on or after the applicable date, and
before December 31, 2024, and
(C) which was to be used to purchase or construct a
principal residence in the Iowa disaster area.
(3) Applicable date.--For purposes of this subsection, the
term ``applicable date'' means--
(A) in the case of a qualified distribution
received with respect to the Iowa disaster area
described in subsection (a)(4)(B)(i), April 26, 2024,
and
(B) in the case of a qualified distribution
received with respect to the Iowa disaster area
described in subsection (a)(4)(B)(ii), June 14, 2024.
(c) Loans From Qualified Plans.--
(1) Increase in limit on loans not treated as
distributions.--In the case of any loan from a qualified
employer plan (as defined under section 72(p)(4) of the
Internal Revenue Code of 1986) to a qualified individual made
during the period beginning on the date of the enactment of
this Act and ending on December 31, 2025--
(A) clause (i) of section 72(p)(2)(A) of such Code
shall be applied by substituting ``$100,000'' for
``$50,000'', and
(B) clause (ii) of such section shall be applied by
substituting ``the present value of the nonforfeitable
accrued benefit of the employee under the plan'' for
``one-half of the present value of the nonforfeitable
accrued benefit of the employee under the plan''.
(2) Delay of repayment.--In the case of a qualified
individual with an outstanding loan on or after the qualified
beginning date from a qualified employer plan (as defined in
section 72(p)(4) of the Internal Revenue Code of 1986)--
(A) if the due date pursuant to subparagraph (B) or
(C) of section 72(p)(2) of such Code for any repayment
with respect to such loan occurs during the period
beginning on the qualified beginning date and ending on
December 31, 2025, such due date shall be delayed for 1
year,
(B) any subsequent repayments with respect to any
such loan shall be appropriately adjusted to reflect
the delay in the due date under paragraph (1) and any
interest accruing during such delay, and
(C) in determining the 5-year period and the term
of a loan under subparagraph (B) or (C) of section
72(p)(2) of such Code, the period described in
subparagraph (A) shall be disregarded.
(3) Qualified individual.--For purposes of this subsection,
the term ``qualified individual'' means an individual whose
principal place of abode on the applicable date described in
subsection (a)(4)(C) is located in the Iowa disaster area and
who has sustained an economic loss by reason of severe storms,
flooding, straight-line winds, or tornadoes beginning on such
date.
(4) Qualified beginning date.--For purposes of this
subsection, the qualified beginning date is the applicable date
described in subsection (a)(4)(C).
(d) Provisions Relating to Plan Amendments.--
(1) In general.--If this subsection applies to any
amendment to any plan or annuity contract, such plan or
contract shall be treated as being operated in accordance with
the terms of the plan during the period described in paragraph
(2)(B)(i).
(2) Amendments to which subsection applies.--
(A) In general.--This subsection shall apply to any
amendment to any plan or annuity contract which is
made--
(i) pursuant to any provision of this
section, or pursuant to any regulation issued
by the Secretary or the Secretary of Labor
under any provision of this section, and
(ii) on or before the last day of the first
plan year beginning on or after January 1,
2026, or such later date as the Secretary may
prescribe.
In the case of a governmental plan (as defined in
section 414(d) of the Internal Revenue Code of 1986),
clause (ii) shall be applied by substituting the date
which is 2 years after the date otherwise applied under
clause (ii).
(B) Conditions.--This subsection shall not apply to
any amendment unless--
(i) during the period--
(I) beginning on the date that this
section or the regulation described in
subparagraph (A)(i) takes effect (or in
the case of a plan or contract
amendment not required by this section
or such regulation, the effective date
specified by the plan), and
(II) ending on the date described
in subparagraph (A)(ii) (or, if
earlier, the date the plan or contract
amendment is adopted),
the plan or contract is operated as if such plan or
contract amendment were in effect, and
(ii) such plan or contract amendment
applies retroactively for such period.
SEC. 3. TEMPORARY SUSPENSION OF LIMITATIONS ON CHARITABLE
CONTRIBUTIONS.
(a) In General.--Except as otherwise provided in paragraph (2),
subsection (b) of section 170 of the Internal Revenue Code of 1986
shall not apply to qualified contributions and such contributions shall
not be taken into account for purposes of applying subsections (b) and
(d) of such section to other contributions.
(b) Treatment of Excess Contributions.--For purposes of section 170
of the Internal Revenue Code of 1986--
(1) Individuals.--In the case of an individual--
(A) Limitation.--Any qualified contribution shall
be allowed only to the extent that the aggregate of
such contributions does not exceed the excess of the
taxpayer's contribution base (as defined in
subparagraph (G) of section 170(b)(1) of such Code)
over the amount of all other charitable contributions
allowed under section 170(b)(1) of such Code.
(B) Carryover.--If the aggregate amount of
qualified contributions made in the contribution year
(within the meaning of section 170(d)(1) of such Code)
exceeds the limitation of clause (i), such excess shall
be added to the excess described in the portion of
subparagraph (A) of such section which precedes clause
(i) thereof for purposes of applying such section.
(2) Corporations.--In the case of a corporation--
(A) Limitation.--Any qualified contribution shall
be allowed only to the extent that the aggregate of
such contributions does not exceed the excess of the
taxpayer's taxable income (as determined under
paragraph (2) of section 170(b) of such Code) over the
amount of all other charitable contributions allowed
under such paragraph.
(B) Carryover.--Rules similar to the rules of
subparagraph (A)(ii) shall apply for purposes of this
subparagraph.
(c) Exception to Overall Limitation on Itemized Deductions.--So
much of any deduction allowed under section 170 of the Internal Revenue
Code of 1986 as does not exceed the qualified contributions paid during
the taxable year shall not be treated as an itemized deduction for
purposes of section 68 of such Code.
(d) Qualified Contributions.--
(1) In general.--For purposes of this subsection, the term
``qualified contribution'' means any charitable contribution
(as defined in section 170(c) of the Internal Revenue Code of
1986) if--
(A) such contribution--
(i) is paid during the period beginning on
April 24, 2024, and ending on December 31,
2024, in cash to an organization described in
section 170(b)(1)(A) of such Code, and
(ii) is made for relief efforts in the Iowa
disaster area,
(B) the taxpayer obtains from such organization
contemporaneous written acknowledgment (within the
meaning of section 170(f)(8) of such Code) that such
contribution was used (or is to be used) for relief
efforts described in clause (i)(II), and
(C) the taxpayer has elected the application of
this subsection with respect to such contribution.
(2) Iowa disaster area.--For purposes of paragraph (1), the
term ``Iowa disaster area'' has the meaning given such term in
section 2(a)(4)(B).
(3) Exception.--Such term shall not include a contribution
by a donor if the contribution is--
(A) to an organization described in section
509(a)(3) of the Internal Revenue Code of 1986, or
(B) for the establishment of a new, or maintenance
of an existing, donor advised fund (as defined in
section 4966(d)(2) of such Code).
(4) Application of election to partnerships and s
corporations.--In the case of a partnership or S corporation,
the election under subparagraph (A)(iii) shall be made
separately by each partner or shareholder.
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