Worker Savings Account Act of 2009 - Amends the Internal Revenue Code to: (1) establish worker savings accounts to make payments to workers during periods of unemployment; (2) treat such accounts in the same manner as individual retirement accounts (IRAs) for tax purposes; (3) allow employer matching contributions to such accounts; (4) make a portion of the tax credit for contributions to retirement accounts (saver's credit) refundable; and (5) require increases in the saver's credit to be paid into a worker savings account.
Provides that no provision of this Act shall be construed to diminish an employer's obligation to pay federal and state unemployment taxes or to reduce the amount of unemployment compensation to which a worker may be entitled.
[Congressional Bills 111th Congress]
[From the U.S. Government Printing Office]
[H.R. 153 Introduced in House (IH)]
111th CONGRESS
1st Session
H. R. 153
To amend the Internal Revenue Code of 1986 to provide for tax-favored
unemployment savings accounts, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 6, 2009
Mr. McHugh 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 provide for tax-favored
unemployment savings accounts, and for other purposes.
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 ``Worker Savings Account Act of
2009''.
SEC. 2. WORKER SAVINGS ACCOUNTS.
(a) In General.--Subpart A of part I of subchapter D of chapter 1
of the Internal Revenue Code of 1986 (relating to pension, profit-
sharing, stock bonus plans, etc.) is amended by inserting after section
408A the following new section:
``SEC. 408B. WORKER SAVINGS ACCOUNTS.
``(a) In General.--
``(1) Treated in same manner as ira.--Except as provided in
this section, a worker savings account shall be treated for
purposes of this title in the same manner as an individual
retirement plan.
``(2) Separate application of rules.--Rules made applicable
by reason of this paragraph shall be applied separately with
respect to worker savings accounts and individual retirement
plans of the individual.
``(b) Worker Savings Account.--For purposes of this title, the term
`worker savings account' means an individual retirement plan (as
defined in section 7701(a)(37)) which is designated (in such manner as
the Secretary may prescribe) at the time of establishment of the plan
as a worker savings account.
``(c) Contributions.--
``(1) Employer contributions.--For purposes of this
section, the amount in effect under section 219(b)(5)(A), with
respect to an individual for a taxable year, shall be increased
by the lesser of--
``(A) $5,000, or
``(B) the amounts contributed for the taxable year
to the individual's worker savings account by all
employers of the individual.
``(2) Worker savings account refund payment.--Section
408(a)(1) shall not apply with respect to a payment under
section 6431.
``(3) Contributions after receipt of social security
benefits.--Except in the case of a rollover contribution
described in subsection (e)(1), no contributions may be made to
an individual's worker savings account during calendar years
beginning after the first month such individual begins
receiving amounts by reason of entitlement to a monthly benefit
under title II of the Social Security Act.
``(d) Treatment of Distributions.--
``(1) In general.--Any amounts distributed from a worker
savings account shall be included in gross income, unless such
amount is a qualified unemployment distribution.
``(2) Qualified unemployment distribution.--For purposes of
this section--
``(A) In general.--The term `qualified unemployment
distribution' means any amount distributed--
``(i) during a period of unemployment of
the account beneficiary which is by reason of
termination of employment (other than for gross
misconduct of the account beneficiary), or
``(ii) not earlier than the first month the
account beneficiary receives an amount by
reason of entitlement to a monthly benefit
under title II of the Social Security Act.
``(3) Disability distribution.--Paragraph (1) shall not
apply to any amount paid or distributed on or after disability
(within the meaning of section 72(m)(7)) of the account
beneficiary.
``(4) Other distribution rules.--
``(A) Excess contributions; transfer of account
incident to divorce.--Rules similar to the rules of
paragraphs (4) through (6) of section 408(d) shall
apply for purposes of this section.
``(B) No minimum distribution requirement prior to
death.--Notwithstanding subsections (a)(6) and (b)(6),
section 401(a)(9) and the incidental death benefit
requirement of section 401(a) shall not apply for
purposes of this subsection.
``(C) Treatment after death of account
beneficiary.--Rules similar to the rules of paragraph
(8) of section 223(f) shall apply for purposes of this
section.
``(e) Definitions and Special Rules.--For purposes of this
section--
``(1) Rollover contributions.--An amount is described in
this paragraph as a rollover contribution if it meets the
requirements of clauses (i) and (ii).
``(A) In general.--Paragraph (1) shall not apply to
any amount paid or distributed from a worker savings
account to the account holder to the extent--
``(i) the entire amount received is paid
into a worker savings account for the benefit
of such holder not later than the 60th day
after the day on which the holder receives the
payment or distribution, or
``(ii) the entire amount received is paid
into an eligible retirement plan (as defined in
section 408(d)(3)) for the benefit of such
holder not later than the 60th day after the
day on which the holder receives the payment or
distribution, except that the maximum amount
which may be paid into such plan may not exceed
the portion of the amount received which is
includible in gross income (determined without
regard to this paragraph).
``(B) Limitation.--This paragraph shall not apply
to any amount described in paragraph (A) received by an
individual from a worker savings account if, at any
time during the 1-year period ending on the day of such
receipt, such individual received any other amount
described in subparagraph (A) from a worker savings
account which was not includible in the individual's
gross income because of the application of this
paragraph.
``(2) Account beneficiary.--The term `account beneficiary'
means the individual on whose behalf the worker savings account
is established.
``(f) Inflation Adjustment.--In the case of any taxable year
beginning in a calendar year after 2010, the dollar amount contained in
subsection (c)(1) shall be increased by an amount equal to--
``(1) such dollar amount, multiplied by
``(2) the cost-of-living adjustment determined under
section 1(f)(3) for the calendar year in which the taxable year
begins, determined by substituting `calendar year 2009' for
`calendar year 1992' in subparagraph (B) thereof.
Any increase determined under the preceding sentence shall be rounded
to the nearest multiple of $100.''.
(b) Clerical Amendment.--The table of sections for subpart A of
part I of subchapter D of chapter 1 of such Code is amended by
inserting after the item relating to section 408A the following new
item:
``Sec. 408B. Worker savings accounts.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2009.
SEC. 3. PORTION OF SAVER'S CREDIT REFUNDABLE.
(a) In General.--Section 25B of such Code (relating to elective
deferrals and IRA contributions by certain individuals) is amended by
adding at the end the following new subsection:
``(h) Portion of Credit Refundable.--
``(1) In general.--The aggregate credits allowed to a
taxpayer under subpart C shall be increased by the lesser of--
``(A) $1,000, or
``(B) the amount of the credit attributable to
qualified retirement savings contributions made by the
individual to worker savings accounts which would be
allowed under this section (without regard to this
subsection and the limitation under section 26(a)(2) or
subsection (g), as the case may be).
The amount of the credit allowed under this subsection shall not be
treated as a credit allowed under this subpart and shall reduce the
amount of credit otherwise allowable under subsection (a) without
regard to section 26(a)(2) or subsection (g), as the case may be.
``(2) Limitation.--The amount of the credit allowed under
this section for any taxable year shall not exceed an amount
equal to the excess (if any) of--
``(A) $5,000, over
``(B) the aggregate amount of credits allowed under
this subsection for all prior taxable years.
``(3) Inflation adjustment.--In the case of any taxable
year beginning in a calendar year after 2010, each of the
dollar amounts contained in paragraphs (1) and (2) shall be
increased by an amount equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined
under section 1(f)(3) for the calendar year in which
the taxable year begins, determined by substituting
`calendar year 2009' for `calendar year 1992' in
subparagraph (B) thereof.
Any increase determined under the preceding sentence shall be
rounded to the nearest multiple of $100.''.
(b) Refund Payable to Worker Savings Account.--
(1) In general.--Subchapter B of chapter 65 of the Internal
Revenue Code of 1986 is amended by adding at the end the
following new section:
``SEC. 6431. WORKER SAVINGS ACCOUNT REFUND PAYMENT.
``(a) In General.--In the case of a credit allowed to an individual
which is attributable to an increase under section 25B(h), the
Secretary shall pay the amount of such credit into the designated
retirement account of the individual.
``(b) Designated Retirement Account.--The term `designated
retirement account' means any worker savings account of the
individual--
``(1) which is designated (in such form and manner as the
Secretary may provide) on the individual's return of tax for
the taxable year to receive the payment under subsection (a),
and
``(2) which, under the terms of the account, accepts the
payment described in paragraph (1).''.
(2) Clerical amendment.--The table of sections for
subchapter B of chapter 65 of such Code is amended by adding at
the end the following new item:
``Sec. 6431. Worker savings account refund payment.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2009.
SEC. 4. NO INFERENCE AS TO STATE AND FEDERAL UNEMPLOYMENT COMPENSATION.
No provision of this Act (including the amendments made thereby)
shall be construed to--
(1) diminish an employer's obligation to pay any applicable
State and Federal unemployment taxes (or any other amount
required under State or Federal law to be paid into an
unemployment fund), or
(2) reduce the amount of unemployment compensation (as
defined in section 85(b) of the Internal Revenue Code of 1986)
to which an individual is entitled.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
Sponsor introductory remarks on measure. (CR E69)
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