Roth Accounts for Youth Savings Act of 2014 or the RAYS Act - Amends the Internal Revenue Code, with respect to Roth individual retirement accounts (Roth IRAs), to allow dependents of a taxpayer to establish a Roth IRA (Roth Account for Youth). Disregards any amount in a Roth Account for Youth for purposes of determining elibility for benefits or assistance for a means-tested federal benefit program.
[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4129 Introduced in House (IH)]
113th CONGRESS
2d Session
H. R. 4129
To amend the Internal Revenue Code of 1986 to provide for tax preferred
savings accounts for dependent youth, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 28, 2014
Mr. Hinojosa 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 preferred
savings accounts for dependent youth, 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 ``Roth Accounts for Youth Savings Act
of 2014'' or the ``RAYS Act''.
SEC. 2. ROTH ACCOUNT FOR YOUTH.
(a) In General.--Section 408A of the Internal Revenue Code of 1986
(relating to Roth IRAs) is amended by adding at the end the following:
``(g) Roth Account for Youth.--
``(1) In general.--In the case of a dependent of a taxpayer
to whom this paragraph applies for the taxable year and with
respect to whom an election for the taxable year is in effect
under paragraph (3)(B), the limitation of subsection (c)(2)
shall be equal to the sum of--
``(A) the contribution limit determined under this
section (before the application of this subsection)
with respect to the dependent, plus
``(B)(i) the dollar amount determined (before the
application of this subsection) under subsection (c)(2)
for the taxable year with respect to such taxpayer,
without regard to section 219(b)(5)(B), reduced by
``(ii) the sum of--
``(I) all prior contributions to all other
Roth IRAs maintained on behalf of all other
dependents of such taxpayer for the taxable
year, determined by taking into account the
order elected by the taxpayer under paragraph
(3)(B), plus
``(II) the aggregate amount of
contributions to all individual retirement
plans and Roth IRAs maintained on behalf of the
taxpayer for the taxable year.
``(2) Maximum contribution.--In no case shall the aggregate
amount of contributions to all individual retirement plans and
Roth IRAs maintained on behalf of a dependent in a taxable year
exceed the deductible amount determined under section
219(b)(5)(A).
``(3) Ordering rules.--
``(A) Taxpayer's own iras.--Subsection (c)(2) shall
apply with respect to all individual retirement plans
maintained for the benefit of the taxpayer before
paragraph (1) applies with respect to a dependent of
the taxpayer.
``(B) Election of order in the case of more than 1
dependent.--For purposes of determining the
contribution limit under paragraph (1) for more than 1
dependent, paragraph (1)(B)(ii) shall apply with
respect to dependents of the taxpayer in the order
elected by the taxpayer.
``(4) Dependent to whom paragraph (1) applies.--Paragraph
(1) shall apply to any dependent of a taxpayer if--
``(A) the taxpayer is allowed a deduction under
section 151 for the dependent for the taxable year,
``(B) in the case of a taxpayer who is married, the
taxpayer files a joint return for the taxable year, and
``(C) the amount of compensation (if any)
includible in the dependent's gross income for the
taxable year is less than the compensation includible
in the gross income of the taxpayer for the taxable
year.
``(5) Special rule for divorced parents, etc.--For purposes
of paragraph (3), rules similar to the rules of section 152(e)
shall apply.
``(6) Compensation.--For purposes of this subsection, the
term `compensation' has the meaning given such term by section
219(f)(1).''.
(b) Conforming Amendment.--Section 408A(d)(2)(B) of the Internal
Revenue Code of 1986 is amended by striking ``Roth IRA)'' and by
inserting ``Roth IRA or a contribution is made to a dependent's Roth
IRA under subsection (g))'' after ``such individual's spouse''.
(c) Income Disregard Under Federal Means-Tested Benefit Programs.--
The amount in a Roth Account for Youth established pursuant to section
408A(g) of the Internal Revenue Code of 1986 shall be disregarded as
income or resources for purposes of determining eligibility for
benefits or assistance, or the amount or extent of benefits or
assistance, under any Federal benefit program that is means-tested.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2014.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
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